Automated Summary
Key Facts
The case involves a long-standing family dispute between brothers, Reginald David Gowar (first respondent) and Francois Peter Gowar (second appellant), over the control of four family trusts. The trusts hold farms, farming equipment, and livestock. The brothers, along with their mother (first appellant), are trustees and beneficiaries. The dispute escalated after Reginald removed Francois as a trustee of the Rietfontein Trust and later, both parties applied to remove each other from trusteeships. The court dismissed both the main application and counter-application, finding the allegations of misconduct and breach of fiduciary duties were intertwined with unresolved factual disputes. The court emphasized that removal of a trustee requires proof of conduct imperiling the trust or its administration, which was not established on the papers.
Deceased Name
Reginald Denver Gowar
Issues
- Whether the cross-appeal's claims of misconduct against the second appellant (Francois Peter Gowar) justify his removal as a trustee, given the factual disputes and the requirement that removal must be in the interests of the trust and beneficiaries.
- Whether the court can terminate a trust under section 13 of the Trust Property Control Act 57 of 1988 when a provision causes unforeseen consequences that hamper the trust's objects, prejudice beneficiaries, or conflict with public interest.
- The court's inherent power to remove a trustee from office at common law and under section 20(1) of the Trust Property Control Act 57 of 1988, requiring that removal is in the interests of the trust and its beneficiaries.
Holdings
- The court dismissed the appeal because the appellants failed to prove that the respondents' conduct imperiled the trust property or its administration, or that removal was in the interests of the trust and beneficiaries. The court emphasized that factual disputes were not resolved and the burden of proof was not met.
- The cross-appeal was dismissed as the respondents did not establish that the second appellant's removal was warranted under s 20(1) of the Act. The court found no sufficient evidence of misconduct or breach of fiduciary duties by the second appellant, and the factual disputes remained unresolved.
Remedies
- The appeal is dismissed with costs including the costs of two counsel.
- The cross-appeal is dismissed with costs.
Will Type
Other
Legal Principles
- The court addressed the argument that certain claims were res judicata, noting that the transfer of shares in GBG Estates (Pty) Ltd was not a trust issue and thus could not form the basis for removal from trusteeship. The principle of res judicata was used to dismiss claims already determined in prior proceedings.
- The court emphasized that trustees must act with care, diligence, and skill as per s 9(1) of the Trust Property Control Act. It reiterated the principle that a fiduciary must avoid exposing trust assets to business risks and adhere to the standard of the 'bonus et diligens paterfamilias'. The judgment also discussed the requirement for a trustee to prioritize beneficiaries' interests over personal ones.
Precedent Name
- Hoosen & others v Deedat & others
- Ex parte Orchison
- Fey NO and Whiteford NO v Serfontein & another
- Benning v Union Government (Minister of Finance)
- Sackville West v Nourse & another
- Potgieter & another v Potgieter NO & others
- Madrassa Anjuman Islamia v Johannesburg Municipality
- De Wet v Deetlefs
- Curators, Emma Smith Educational Fund v University of KwaZulu-Natal & others
- Crookes NO & another v Watson & others
Cited Statute
- Trust Property Control Act 57 of 1988
- Insolvency Act 24 of 1936
Judge Name
- Majiedt
- Maya
- Petse
- Baartman
- Victor
Passage Text
- In the result the following order is made: 1 The appeal is dismissed with costs including the costs of two counsel. 2 The cross-appeal is dismissed with costs.
- It is now trite that the court has inherent power to remove a trustee from office at common law. This power also derives from s 20(1) of the Act which provides as follows: 20. Removal of trustee — (1) A trustee may, on the application of the Master or any person having an interest in the trust property, at any time be removed from his office by the court if the court is satisfied that such removal will be in the interests of the trust and its beneficiaries.
- The decisive consideration is the welfare of the beneficiaries and the proper administration of the trust and the trust property. And, sight must not be lost of the crucial fact that the court may order the removal of a trustee only if such removal will, as required by s 20(1) of the Act, be 'in the interests of the trust and its beneficiaries'.
Beneficiary Classes
- Child / Issue
- Spouse / Civil Partner