Fesi and Another v Trustees Elect of the Ndabeni Communal Property Trust (411/2017, 412/2017) [2018] ZASCA 33; [2018] 2 All SA 617 (SCA) (27 March 2018)

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[2018] ZASCA 33
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Fesi and Another v Trustees Elect of the Ndabeni Communal Property Trust (411/2017, 412/2017) [2018] ZASCA 33; [2018] 2 All SA 617 (SCA) (27 March 2018)

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THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Reportable
Case
no.: 411/2017 & 412/2017
In
the matter between:
FIKISWA
FESI

FIRST
APPELLANT
MASTER
OF THE WESTERN CAPE HIGH COURT,
CAPE
TOWN

SECOND APPELLANT
and
THE
TRUSTEES ELECT OF THE NDABENI COMMUNAL
PROPERTY
TRUST (IT 1056/98)

RESPONDENT
Neutral
Citation:
Fesi
v Ndabeni Communal Property Trust
(411/2017
& 412/2017)
[2018] ZASCA 33
(27 March 2018).
Coram:
Navsa,
Swain and Mbha JJA and Pillay D and Schippers AJJA
Heard:
26
February 2018
Delivered:
27
March 2018
Summary:
Trust :
whether persons elected as trustees of a trust established to
administer and develop property received as a result of a
land
restitution claim properly appointed in terms of the trust deed :
whether Master correct in refusing to issue letters of authority
:
provisions of Trust Property Control Act 57 of 1988 and Master’s
supervisory role discussed : discussion of concerns by
Master, the
responsible Minister and the Land Claims Commissioner, regarding
disposal of the trust property and the need to meet
constitutional
objectives in relation to land restitution : Master, Minister and
Land Claims Commissioner commended for being rightly
concerned about
propriety of election of trustees and disposal of trust property :
whether persons elected acted in fiduciary manner
: conduct of
attorney criticised : importance of land restitution reiterated.
ORDER
On
appeal from
:
Western Cape Division, Cape Town (Nuku J sitting as court of first
instance).
The
following order is made:
1.
The appeal is upheld with costs, including the costs of two counsel.
2.
The order of the court below is set aside and substituted as follows:
‘
1.The
application is dismissed with costs including the costs of two
counsel where so employed.’
JUDGMENT
Navsa
JA (Swain and Mbha JJA and Pillay D and Schippers AJJA
concurring):
[1]
This is an appeal against an order by the Western Cape Division of
the High Court, Cape Town, in terms of which the second appellant,

the Master of the Western Cape High Court, Cape Town (the Master),
was directed to issue letters of authority authorising the six

respondents to act as trustees of the Ndabeni Communal Property Trust
IT 1056/98 (the trust). The Master, the first appellant,
Ms Fikiswa
Fesi, the Western Cape Regional Land Claims Commissioner (the
Commissioner) and the Minister of Rural Development and
Land Reform
(the Minister),
[1]
were ordered
to pay their costs. The appeal is before us with the leave of the
court below. The primary question in this appeal
is whether, on the
evidence before the court below, the six respondents were entitled to
the order directing the Master to issue
the letters of authority. The
background, including the socio-economic, socio-political and
constitutional context, is set out
hereafter.
[2]
At the heart of the present appeal and without doubt the cause of the
present and related litigation is land granted to a community
as part
of a statutory land restitution process. Land restitution and access
to land by scores of our people, or rather the lack
of it, has
recently received increasing public attention. There is a growing
sense that unless and until we as a nation deal decisively
with the
unequal ownership of land that is the legacy of our historically
racially divided society, there will be no enduring peace
and the
Constitution will be reduced to a mere written document. The grand
apartheid design was such that prime land in South Africa
was
reserved for the white populace and black people were consigned to
housing in backwaters, mostly without freehold title, from
which they
principally served the needs of white society.
[3]
Section 25(4)
(a)
of the Constitution, recognising the
injustices of the past, affirms our commitment as a nation to land
restitution and reform.
Section 25(5) provides:
‘
The
state must take reasonable legislative and other measures, within its
available resources, to foster conditions which enable
citizens to
gain access to land on an equitable basis.’
Section
25(7) of the Constitution reads:
‘
A
person or community dispossessed of property after 19 June 1913 as a
result of past racially discriminatory laws or practices
is entitled,
to the extent provided by an Act of Parliament, either to restitution
of that property or to equitable redress.’
[4]
The Restitution of Land Rights Act 22 of 1994 (the Restitution Act)
is a measure to achieve the Constitutional objectives referred
to in
the preceding paragraph. The long title of that Act reads as follows:
‘
To
provide for the restitution of rights in land to persons or
communities dispossessed of such rights after 19 June 1913 as a
result of past racially discriminatory laws or practices; to
establish a Commission on Restitution of Land Rights and a Land
Claims
Court; and to provide for matters connected therewith.’
[5]
Returning to the facts of the present case. During 1997 a land claim
was lodged with the Land Claims Commission in terms of
the
Restitution Act,
[2]
seeking
restoration of erf 24176 Maitland, in the district of Goodwood, Cape
Town, Western Cape on behalf of the Ndabeni Community
(the
community). This was land that had previously been occupied by the
community before they were forcefully removed between 1927
and 1936
from Maitland and relocated to Langa, under apartheid legislation. In
1942 the land in question, 54.8 hectares in extent,
was transferred
in its entirety to the City Council of Cape Town, which subsequently
subdivided it and sold off various portions.
When the community
lodged its land claim it was no longer feasible for government to
restore the land from which the community
had been removed.
[6]
On 13 October 2001, after an extensive process, the Government of the
Republic represented by a number of different ministries,
[3]
settled the community’s land claim and concluded a settlement
agreement with the trust, established in terms of a trust deed,
which
was notarially executed on 16 February 1998. The trust was created to
serve the interests of the claimant community and in
contemplation of
a successful land claim. It was subsequently essential to and
required by the settlement agreement. The settlement
agreement gave
the trust the right to take transfer of state land in Maitland, Cape
Town of approximately 54.8 hectares (the property)
for the benefit of
the community. The trust became the registered owner of the property
in 2004. The community members dispossessed
of their land and/or
their descendants have since then not reaped any benefits from the
transfer of the property. As will become
apparent, the community has
after two decades found the promise of land restitution and attendant
benefits hollow.
[7]
In terms of clause 15.2 of the trust deed there should at all times
be not less than six trustees in office. The primary issue
in this
dispute is whether the six respondents were entitled to assume office
as trustees of the trust, having been elected to
that office at a
meeting convened for that purpose. This raises the central question:
whether the six respondents were properly
elected in terms of the
trust deed by persons entitled to vote. Simply put, the legality of
the election of the respondents to
the office of trustee is in
dispute. There are also questions about whether the conduct of the
respondents, described later in
this judgment, in relation to the
property, precluded the order granted by the court below.
[8]
I pause to record that the late Mr Gilbert Fesi, the father of the
first appellant, is recorded in the trust deed as the initial
donor.
In resisting the order sought by the six respondents in the court
below, Ms Fesi asserted that because of her family involvement
in the
history of the Ndabeni community, she was well placed to set out the
relevant facts in relation to the present dispute.
[9]
Unsurprisingly, because of the value of the property, which is
located fairly close to the Cape Town City Centre, and the
potentially
lucrative attendant benefits, the trust has had a long
and troubled history, stretching back to 1998. For example, it
appears that
an amount of approximately R5 million transferred to the
trust in 2002 as a restitution discretionary grant by the State, to
give
effect to the envisaged development of the land for the benefit
of the community, was not accounted for by the trustees then in

office.
[10]
A major challenge encountered in advancing the objects of the trust
in favour of the community has been to identify and verify
members of
the trust who have an interest in and are entitled to be heard and to
vote on issues related to the trust. It is necessary
at this stage to
note that the settlement agreement in terms of which the State
awarded the property to the trust describes the
‘Ndabeni
Community’, which the award of the land intended to benefit, as
follows:
‘
The
community comprising those persons, including their direct
descendants, who are the surviving members, and legal successors
to
the deceased members, of the community that was formerly resident at
Ndabeni, and dispossessed of its rights in land in the
circumstances
indicated above, including “the spouse or partner in a
customary union of any such person whether or not such
customary
union has been registered”, as contemplated by the provision of
the Act, subject to the verification process envisaged
by clause
10.2.’
[11]
Clause 10.2 of the agreement reads as follows:
‘
The
aforegoing Grants shall be accorded due priority, and shall be
otherwise subject to the normal terms and conditions applicable

thereto, including the conclusion of any such Transfer of Funds
Agreements, Financial Administration Agreements, and other Financial

and Implementation Agreements, as may be applicable in these
circumstances; and subject further to the implementation of a
mutually
acceptable verification process to identify eligible
Households and Members of the Community. If for any reason the
Parties are
unable to agree upon the terms and conditions of any such
Agreements as are referred to above, then any of such Parties shall
be
entitled to apply to Court for directions and an Order to
determine the matter in issue.’
[12]
Clauses 12.1 and 12.3, which are significant, provide:
‘
Upon
fulfilment of the Condition Precedent stipulated in clause 5,
[4]
the terms of this Agreement shall constitute a full and final
settlement of the Community’s Restitution Claim. Accordingly,

the COMMUNITY TRUST, duly mandated as aforesaid, does hereby:
12.1
warrant and undertake
that all eligible persons who may have
timeously lodged restitution claims with the Commission in respect of
rights in the land
described in paragraph B of the Preamble to this
Agreement, whether in respect of land, cash compensation, or other
equitable redress,
shall be or become entitled to be members, and as
such, contingent beneficiaries, of the COMMUNITY TRUST; and
.
. . .
12.3
confirm its commitment
to admit to membership of the COMMUNITY TRUST, all eligible persons
who make application for membership by no later than a final
closing
date, which shall be a date no earlier than such as may be agreed
between the Trustees and the Commission as fair and reasonable;

subject however to any contrary Order or binding direction upon the
Trustees, arising from the exercise of the continuing jurisdiction

referred to in clause 13 hereunder.’
[5]
(My emphasis.)
[13]
It was thus prospectively incumbent on the trust to ensure that all
members entitled to the benefits of the land awarded in
terms of the
settlement agreement, were afforded the opportunity to participate in
the affairs of the trust and to vote on matters
in relation thereto.
I note that the settlement agreement contemplates the continued
involvement of the Commission in identifying
and verifying community
members entitled to participate in the affairs of the community.
[14]
I now turn to the relevant provisions of the trust deed.
Significantly, clause 4.1 of the trust deed sets out the trust’s

‘main objective’ as being ‘to hold property in
common for the benefit of its members’. Clause 4.3 sets
out the
following as one of the trust’s objects:
‘
To
acquire, hold, develop, improve and administer for the benefit of its
Members, and the persons eligible to become Members from
time to
time, the various rights, assets and interests constituting the Trust
Fund.’
The
trust’s principal asset is the land referred to above and the
prescribed object has to be seen in the light thereof.
[15]
Clause 4.4 of the trust deed provides that the trust must admit as
members ‘those natural and juristic persons who from
time to
time become eligible to acquire Membership in terms of the provisions
of Clause 8’. Clause 3 of the trust deed defines
‘Members’
as follows:
‘
[T]hose
natural and juristic persons as may from time to time be admitted to
Membership, upon application, and in accordance with
the provisions
of Clause 8.’
[16]
Clause 8 reads as follows:
‘
8.1
Membership of the TRUST shall be divided into Two (2) categories,
namely:
8.1.1
Institutional Membership; and
8.1.2
Individual Membership.
8.2
Membership of the TRUST shall be conferred, on application therefor,
upon the following persons:
8.2.1
All natural persons (Individual Members) whose names are recorded on
Schedule One; and
8.2.2
Any other natural or juristic person, Institutional Member whom the
TRUSTEES are reasonably satisfied is entitled to participate
in an
award or settlement in respect of or relating to the Ndabeni Land,
under the
Restitution of Land Rights Act 1994
.’
Clause
10 obliges the trust to establish and maintain a register of members.
The clauses set out in this and the two preceding paragraphs
are
consonant with the warranties set out in the settlement agreement and
referred to in para 12 above.
[17]
Clause 15 of the deed deals with the appointment and tenure of
trustees. Clause 15.1 provides for an initial interim board
of
trustees. Clause 15.2 reads as follows:
‘
At
the first Annual General Meeting, the Initial Interim Board of
TRUSTEES shall resign, and the Members (both Individual and
Institutional)
shall elect a new Board, comprising at least Six (6)
TRUSTEES, which new Board shall serve until the second Annual General
Meeting
after registration of this TRUST DEED, when the whole of that
Board shall resign; the intention being that each Board elected to

office after the Initial Interim Board, shall serve for a period of
One (1) year, and that there should at all times be not less
than Six
(6) TRUSTEES in office.’
Clause
15. 4 permits retiring trustees to stand for re-election.
[18]
Since the inception of the trust there appears to have been a
succession of boards of trustees, ostensibly elected annually.
It is
common cause that the respondents were appointed trustees in August
2015, after the failure of the prior board to convene
an annual
general meeting to enable a new board of trustees to be elected. In
the period from the inception of the trust to 2015
various community
membership lists were prepared. The first, at the instance of the
Minister and the Commissioner. At the time
that the land claim was
lodged, 587 members were listed as claimants. That list was verified
by the Commission and confirmed by
the Land Claims Court.
Subsequently the 587 members were grouped into 249 households. The
intention appears to have been for trustees
to resort to a template
provided by the Commission. A link was then to be established between
originally displaced occupants and
their children and grandchildren.
It was the intention of the Minister’s department upon
verification by trustees to approach
the Land Claims Court to confirm
the list of members. The six respondents, as advised by their
attorneys, appear to draw a distinction
between, on the one hand,
originally displaced members of the community who are still alive
and, on the other, surviving members
of households of original
members who have since passed away. The former being considered being
members and the latter beneficiaries.
Suffice to say that the trust
deed makes no such distinction. This is evident when one has regard
to clause 8 set out in para 16
above.
[19]
Before the process referred to in the preceding paragraph could be
completed, the Master appointed an interim board of trustees
during
the first half of 2015 to facilitate the election of a new board of
trustees. The six respondents were elected at a meeting
convened for
that purpose. The legality of the election was called into question
by a number of persons. The Master allowed a period
of time for a
court challenge to be launched. When that was not forthcoming, the
Master, on   12 August 2015, issued
letters of authority to
the six respondents. It is necessary to note that in her answering
affidavit in the present litigation,
Ms Fesi questioned how the six
respondents, who are not members of the community and were thus not
entitled to be present at and
participate in the meeting of members,
could be elected. The response to this in the replying affidavit on
behalf of the six respondents
is as follows:
‘
[I]t
is not so that none of the Applicants are members of the Trust.
However, it is irrelevant whether or not they are Members of
the
Trust as the Trust Deed does not require a trustee to be a member of
the Trust.’
It
is clear that the respondents, in seeking the order set out in para 1
above, did not declare which of them were
not
members of the community and further, did not provide any explanation
of how they are connected to and did not say how or when
they became
involved in the affairs of the community.
[20]
It is common cause that challenges in verifying a full register of
community members entitled to participate in the affairs
of the trust
has bedevilled progress in relation to advancing its objects. It is
accepted by the respondents that at the time of
the meeting at which
they were elected, such a verified register had not been finalised.
This is evident from para 21 of their
founding affidavit, which also
sets out their view concerning an interpretation of membership in
relation to the trust deed. The
paragraph reads as follows:
‘
After
their appointment in August 2015 as trustees of the Trust, the
Applicants made it their business to put the affairs of the
Trust in
order with the view to using the Property of the Trust for the
benefit of its Members and Beneficiaries in accordance
with the
objects of the Trust set out in clause 4 of the Trust Deed. As stated
in paragraph 16 above, for ease of reference I refer
in this
affidavit to the beneficiary households/families holding under and
represented by each registered Member of the Trust as

“Beneficiaries”. I point out, however that in terms of
the Trust Deed such Beneficiaries are not true beneficiaries
as
understood in trust law, as the true beneficiaries in that context of
the Trust are its registered Members. All benefits of
the Trust must
flow to its registered Members and they then have the responsibility
to ensure that the Beneficiaries holding under
them share fairly in
such benefits. I point out further that the Membership Register of
the Members of the Trust lists 437 Members
of the Trust. The
Applicants estimate that there may be as many as between three and
five thousand Beneficiaries holding under
the Members of the Trust.
It is for this reason that the Trust Deed and the Settlement
Agreement provide for Beneficiaries (i.e.
family groups/households)
represented by a Member, being either the eldest person of such
family group/household or the person
nominated by the Beneficiaries
of that family group/household to represent them as the Member of the
Trust, as it would be an administrative
and financial nightmare for
the trustees of the Trust to deal individually with all of the
Beneficiaries. As it is, it is very
difficult to administer the 437
Members and to do so in accordance with the requirements of the Trust
Deed. This difficulty has
contributed significantly to the failure to
date of the trustees to achieve materially the object of the Trust.’
[21]
Later in the founding affidavit, the following was stated on behalf
of the six respondents:
‘
22.3
On the advice of ENSafrica and with their assistance, the Applicants
proceeded to prepare the consolidated Membership Register
of the
Members of the Trust referred to in paragraph 15 above, Annexure MM3
hereto. In this regard I point to the following:
22.3.1
clause 8 of the Trust Deed provides for the Individual Membership of
all natural persons listed on Schedule 1 to the Trust
Deed (275
names) and “any
other natural or juristic
person . . .
whom the Trustees are reasonably satisfied is entitled to participate
in an award or settlement in respect of or relating
to the Ndabeni
land, under the
Restitution of Land Rights Act, 1994
”. Clause 8
also provides for Institutional Membership, which Membership is held
by two churches.
22.3.2
pursuant to the land claims process referred to in paragraph 15
above, the State, represented by the Third and Fourth Respondents,

instructed third parties to do a verification of the Members of the
Trust. This resulted in a document that has become known as
the 587
list.
22.3.3
in the years thereafter the Third and Fourth Respondents also
produced a 244 list and a 142 list of Members and the Applicants;
22.3.4
in their capacities as trustees of the Trust and in accordance with
clause 8.2.2 of the Trust Deed, the Applicants as the
trustees
produced a 30 list;
22.3.5
all of these lists are more fully described in the attached
Memorandum (Annexure MM2).
22.4
The Applicants found that the aforesaid lists contained numerous
outdated entries, duplications and anomalies. They accordingly
went
to great lengths with ENSafrica to produce the Membership Register, a
copy of which was forwarded to the Third and Fourth
Respondents on 2
August 2016 and which is attached hereto as Annexure MM3. In their
correspondence with the Applicants and the
Trust, the Third and
Fourth Respondents objected to the process followed by the trustees
in the compilation of the Membership Register.
Initially, the Third
and Fourth Respondents said that it was their prerogative and right
to compile a membership register of the
Members of the Trust. In its
letter of 1 September 2016 to ENSafrica, Annexure MM6 hereto, the
Fourth Respondent, however, required
of the Applicants (in paragraph
11 of that letter) to “
meet
with the Commission and discuss a process that will result in a
process that is transparent, fair, inclusive and credible”
as
far as the compilation of a Register of Members of the Trust is
concerned. At paragraph 15 of that letter the Fourth Respondent

further stated that it will request the First Respondent to “
suspend
issuing a Letter of Authority to the ‘Trustees’ pending
the finalisation of the Members of the Trust in a manner compliant

with the Trust Deed read with the Settlement Agreement and the
Restitution of Land Rights Act, 1994
”. In other words, the
Fourth Respondent objected to the issuing of a letter of authority to
the Applicants pending finalisation
of a register of Members of the
Trust. However, it required of the Applicants, even though they are
not trustees, to engage in
that process with the Third and Fourth
Respondents and by implication envisaged the Trust remaining without
trustees until the
Third and Fourth Respondents have reached
agreement with the Applicants (who in fact have no status or right to
reach such agreement,
as they are not yet trustees) regarding the
Register of Members.’ (Emphasis in original.)
[22]
On 17 August 2015, within days of the issue of the letters of
authority by the Master, referred to in para 19 above, the six

respondents concluded the first of a series of written agreements,
which involved Abacus Asset Management Proprietary Limited (Abacus),

a property developer. Its name was later changed to Abacus Holdings
Proprietary Limited. Compositely, the agreements provided for
the
sale of the property to a joint venture company, Wingfield
Development Company (Pty) Ltd (Devco), of which Abacus and the trust

would hold 74 per cent and 26 per cent of the issued shares,
respectively. I note with alarm, that in terms of a commission
agreement
dated 22 June 2016, the trustees agreed to pay an amount of
R4 million to an individual named Kent Kihl, a Swedish citizen, as
commission for assisting the trust ‘in entering into the
[t]ransaction by introducing the [t]rust to Abacus and Devco and

being the effective cause thereof’. How and why it was
necessary for the ‘introduction’ and for payment of R4

million as commission to someone living in Sweden is not explained.
[23]
It is common cause that at the time of the approach to the court
below for the order referred to at the commencement of this
judgment,
the six respondents were receiving a monthly stipend of R5000 from
Abacus and were also in receipt of financial assistance
from the
company to enable them to conduct the business of the trust.
Furthermore, Abacus ‘assisted’ the respondents
to rent an
office after having furnished it. Abacus also paid transport, venue
and catering costs related to the holding of meetings
of the trust.
[24]
The six respondents sold the property to Devco for R106 million. It
is necessary to note that in 2006 the trust had an offer
for the
property in the amount of R600 million, plus a 26 per cent share in a
development company. It appears that due to the uncertainties

surrounding the composition of the trust and its dysfunctional
nature, that offer was withdrawn. In 2012 the Minister’s
department obtained an
independent
valuation of the land,
which set the value of the land at R214 million as at 24 July 2012.
According to the six respondents they
obtained valuations from Rand
Merchant Bank and Nedbank in the amounts of R103 million and R110
million. Nedbank was at that stage
envisaged to finance the purchase
of the property. The respondents and Abacus agreed to use the mean of
the two valuations. There
is no effective response in reply by the
six respondents to the following assertions by the Commission and the
Minister in their
opposing affidavit in relation to the valuation of
the land:
‘
[T]he
Trustees did not obtain any independent valuations which could have
yielded a better price if they were authorised to undertake

negotiations to sell the land.’
It
bears repeating that at least one of the banks that supplied the
valuations had initially agreed to fund the transaction.
[25]
The transfer of the property to Devco did not proceed due to
challenges to the legality of the conclusion of the agreements

disposing of the property, not only by Ms Fesi and the Master, but
also by the Commissioner and the Minister, who all have an interest

in seeing that land restitution in South Africa meet statutory and
constitutional objectives.
[26]
In the period since they were issued with letters of authority in
August 2015, the respondents’ attorney engaged with
the
Minister, the Commission and the Master concerning the verification
of membership of the community, and about complaints by
community
members as to how the trust was being administered and about the
disposal of the property. The Minister and the Commissioner
disagreed
with the process followed by the respondents in completing and
verifying a membership register. They took the view that
the trust
deed and the settlement agreement had not been followed. Furthermore,
they were adamant that persons who attended meetings
at material
times in relation to the business conducted by the respondents, were
not all verified members and that there were many
persons entitled to
be members who were not on the list used by the respondents.
[27]
If regard is had to the letters of authority issued by the Master in
August 2015, the respondents’ prior term of office,
in
accordance with the trust deed, would have expired during August
2016. By that time there were still ongoing discussions concerning

the verification of members. That notwithstanding, the respondents
scheduled a meeting for the election of a new board of trustees.
It
was held on 7 August 2016. According to the respondents, since 49
members were present and a further 22 were represented by
proxies,
the meeting was quorate as the trust deed provides that at least 50
per cent of members or 10 per cent of members reflected
in the
register of members, whichever is the lesser, meets the quorum
requirements set by the trust deed. The Minister, the Commissioner

and the Master adopted the position set out in the preceding
paragraph.
[28]
The respondents appear to have held another meeting on 16 September
2016, purportedly to authorise the disposal of the property
to Devco.
This is more akin to a ratification, since, it will be recalled that
the agreements disposing of the property were signed
in August 2015,
shortly after the respondents took office when the Master issued
letters of authority. Since this was a meeting
of special
significance, authorising the disposal of the only significant asset
of the trust, which was the very reason for its
existence, it could
only rightly have been discussed at a special general meeting. Clause
19.3 of the trust deed reads as follows:
‘
A
Special General Meeting shall be convened on not less than Fourteen
(14) days’ prior written notice, and such Notice shall
contain
the reason for the Meeting and the nature of the business to be
transacted.’
There
is no indication that the meeting of 16 September 2016 was called in
the manner required by the trust deed nor indeed is there
any
indication that the respondents considered that it ought to have been
dealt with in that manner.
[29]
As these events unfolded, the Minister called on the Master to
suspend issuing letters of authority, pending the resolution
of the
problems related to the verification of members. On 16 September 2016
the Master responded to the Minister’s letter
calling for the
suspension in the following terms:
‘
From
the letter dated 29 July 2016 by ENSafrica, it appears that the
trustees went to considerable lengths to go through a verification

process to identify eligible members of the community. It, however,
appears that the Land Claims Commission want a cohesive/mutually

agreeable process.
Kindly
be advised that unless an agreement is reached on the verification
process by 30 September 2016 (as proposed by the Chief
Land Claims
Commission in the letter dated 19 August 2016 – attached) the
Master shall consider appointing the six newly
elected trustees. The
Trust cannot function without trustees in office to administer the
Trust properly and address the needs of
the community.
Both
the Chief Land Claims Commission and ENS are expected to report back
to the Master by no later than 7 October 2016 and provide
a timeframe
for the process to be concluded.’
[30]
In a letter dated 19 September 2016 the respondents’ attorney
wrote to the Master as follows:
‘
We
trust that you will also understand that to avoid the Trust remaining
without fully authorised trustees, the trustees would expect
to be
issued with full Letters of Authority after 30 September 2016,
whether or not the required verification process has been
completed,
but subject to them having engaged in good faith with the Land Claims
Commission for such purpose.’
The
respondents’ attorney undertook on their behalf to engage with
the Land Claims Commission and the Minister to finalise
the
verification process.
[31]
A further letter was sent to the Master by the respondents’
attorney on 23 September 2016, in which the following appears:
‘
Finally,
we respectfully submit that the Trustees and the Land Claims
Commission have reached agreement on the verification process
to be
followed by them, as required in your letter of 16 September 2016. We
submit further that there is accordingly no reason
to delay issuing a
full Letter of Authority to the Trustees to enable them to continue
with the performance of their obligations
as Trustees of the
abovementioned Trust. We accordingly look forward to receiving your
confirmation that you will now issue the
Letter of Authority.’
It
is common cause that a process was agreed between the Master, the
Minister and the respondents regarding the way forward so as
to be
inclusive and consultative in finalising a truly authentic list of
members.
[32]
On 3 October 2016 Ms Fesi caused a summons to be issued in terms of
which she contested the validity of the appointment of
the
respondents, stretching back to their previous appointment in 2015.
She made serious allegations concerning the manner in which
the
respondents conducted the affairs of the trust and about the disposal
of the property. She charged that they had acted illegally
and
adverse to the interests of the community. The issues raised in the
summons are similar to the ones raised in the present litigation.
[33]
The Master, faced with the summons and having regard to the
complaints received from interested parties concerning the actions
of
the respondents, took the view that the dispute should now be
adjudicated by a court of law and declined to issue the letters
of
authority. In the answering affidavit on behalf of the Master it is
stated that the Master viewed the matter as being sub judice.
The
master intended to appoint independent trustees in terms of the Trust
Property Control Act 57 of 1988 (the Act) to administer
the affairs
of the trust until the dispute was determined by a court. This was
conveyed to the respondents’ attorney in a
letter dated 13
October 2016.
[34]
A further exchange of correspondence between the attorney acting for
the respondents and the Master yielded no results. The
respondents
then decided to launch the application in the court below seeking the
order set out in para 1 above. The Master, Ms
Fesi, the Minister and
the Commissioner all opposed the order sought by the respondents. The
Minister and the Commissioner also
launched a counter-application
seeking the following relief:
‘
1.
That Abacus Holdings (Pty) Ltd (Reg No 2008/014442/07) and Abacus
Development Company (Pty) Ltd, be joined to these proceedings;
2.
Declaring the sale agreement between the Ndabeni Communal Property
Trust and [Devco], including all related ancillary contracts,
void
ab
initio
;
3.
Directing the manner in which the verification process be completed;
4.
Directing that the properly appointed Trustees of the Ndabeni
Communal Property Trust comply with clause 30.1.1 of the Trust
Deed
to have the Trust designated a “
similar
entity”
for purposes
of the
Communal Property Associations Act, No 28 of 1996
.’
[35]
The respondents took the view that the Master, the Minister and the
Commissioner were acting unreasonably in requiring them
to undertake
an exhaustive interactive process to verify membership without
providing financial support to that end. They asserted
that the trust
could not be left without trustees and, having been duly elected at a
meeting convened for that purpose, they were
entitled to the order
sought. They contended that for this reason the matter was urgent.
Furthermore, they pointed to the threat
of illegal occupation of the
property and explained that arrears for rates and taxes were
accumulating and that the agreement for
the disposal of the property
had to be protected, lest the other parties to the agreement withdrew
from the transaction. These
justifications for the urgent approach to
court must be seen against the common cause fact that the trust had
been dysfunctional
for more than a decade and that in effect little
had changed, save for the precipitous conclusion of the agreement
with Devco for
the disposal of the property.
[36]
The Minister, the Master, the Commissioner and Ms Fesi all disputed
the legality of the election of the respondents. As stated
above the
Minister and the Commissioner submitted that the respondents drew a
distinction between members and beneficiaries which
they disagreed
with. The six respondents reduced the original list of 587 referred
to above to 437 members. The Commission and
the Minister were
unwilling to accept the list as they considered that the proper
process for verification of membership had not
been followed. They
also wanted to be certain that family representatives had proper
authorisation from each member of the families
they purported to
represent. All the more so, since the respondents’ preliminary
membership list contained only the names
of the oldest living
descendants, which was not consistent with the trust deed or the
settlement agreement.
[37]
As stated earlier, it is undisputed that following a directive by the
Master, it was agreed between the Commissioner, the Minister
and the
attorney representing the respondent that a mutually acceptable
verification process had to be agreed and followed. The
respondents
asserted that because a process had been agreed, there could be no
impediment to the letters of authority being issued
by the Master.
The Minister, the Commissioner, the Master and Ms Fesi were adamant
that since the verification of members was the
biggest obstacle to
real progress in achieving the objectives of the trust and protecting
the interests of members, it was imperative
that until that was done,
there could be no proper elections and that an issue such as the
disposal of the property, even assuming
it to be permissible, could
not be undertaken.
[38]
As already alluded to, Ms Fesi went further and challenged the
legality of the appointment of the respondents in 2015 and pointed
to
the action which she instituted against the respondents in which all
of the issues raised in this litigation are in focus. Although
all
those who contested the relief sought by the respondents referred to
the matter being sub judice because of Ms Fesi’s
summons, what
appears to have been intended by them was that there was pending
litigation in relation to the dispute. They all
submitted that the
disposal of the property was in contravention of the settlement
agreement and the trust deed. It was contended
that the holding of
the property and its development for the benefit of the community was
the sole object of the trust and that
its disposal effectively
nullified the continued existence of the trust. They asserted that
the respondents, who refer to themselves
as trustees elect, were too
close to Abacus. In this regard they referred to the stipend paid to
the respondents and the fact that
Abacus is paying their legal fees
and other expenses. They contended that this precluded the trustees
elect ‘from exercising
the independence required from trustees
acting in a fiduciary capacity’.
[39]
The replying affidavit of Mr Nkululeko Michael Mguga, one of the
respondents, who described himself as the chairman of the

trustees-elect, in relation to the legality of the election process
in terms of which the six respondents were elected, is especially

instructive. The material part of his evidence describing the voting
process set out below was not, as will become apparent, dealt
with by
the court below
‘
14.2
[T]he Members and Proxies were clearly identifiable as such, as they
had been given coloured stickers.
14.3
Initially the voting process went smoothly, as the Members and
Proxies made their way up to the voting station from their respective

designated seating areas.
.
. . .
14.5
However, as the voting process continued, the Attendees became
restless and anxious to conclude the voting process. At that
time,
the designated officials were also overwhelmed by more people
entering the venue and could no longer control the registration
of
each person at the entrance to the AGM (as was initially done at the
AGM).
14.6
I believe that towards the end of the voting process, certain people
who had signed the Attendance Register, but who were not
on the
Membership Register were allowed to vote without being entitled to do
so.’
As
to the outcome of the voting process, he, inter alia, said the
following:
‘
15.4
The Trustees have identified a number of people who were allowed to
vote at the AGM, but who were not eligible voters as they
are neither
Members nor Proxies. This, however, does not in my submission
invalidate the voting process as a whole, as notwithstanding
the
invalidity of certain votes, the remaining votes cast were all in
favour of the Trustees and were validly cast by Members or
Proxies.’
He
concluded as follows:
‘
16.1
The voting process involved certain problems relating to the control
of the Attendees who were allowed to vote which stemmed
from the
large number of Attendees present at the AGM, as has been experienced
in the past when meetings have been convened by
the Trustees.
However, in my submission, there were sufficient checks and balances
put in place to ensure that the voting process
was not compromised in
its entirety. The Auditor and the independent observer have given
similar accounts of the events that took
place at the AGM, as have
been previously provided to the Master, and both were satisfied with
the voting process which took place
at AGM and the validity of the
election of the Trustees.
16.2
I submit that the quorum of Members and their Proxies, as required in
terms of clause 21.6.1 of the Deed, was present and therefore
the AGM
and the proceedings which took place at the AGM were valid in terms
of the Deed.
16.3
The voting process and the election of Trustees were valid in terms
of the Deed and in line with the wishes of the Members
and Proxies.’
[40]
What is set out in this paragraph is important insofar as the conduct
of the respondents and their attorney in relation to
the affairs of
the trust is concerned. It is also an aspect to which I will revert.
At this stage it is necessary to record the
following: First, in
their founding affidavit, the respondents were adamant that their
attorneys have been acting for them at arm’s
length and on a
professional and fee-paying basis. They go on to say the following:
‘
However,
due to the fact that the Trust has no funds, ENSafrica have allowed
the Trust and its trustees credit for the payment of
the legal costs
incurred by the Trust with ENSafrica. The Trust and its trustees
would not have been able to engage and perform
the activities
referred to in this paragraph 22 without the substantial legal and
financial assistance of ENSafrica.’
Second,
it is clear that the respondents’ attorneys have been of
assistance to the respondents in the compilation of a list
of members
of the community and, as pointed out above, were engaged in
discussions that resulted in an agreed process with the
Minister, the
Commission and the Master as to verification. As stated earlier, the
attorneys proceeded to launch the application
in the court below,
notwithstanding the fact that there was no verified list of members.
Third, despite the fact that the verification
process had not been
completed, we were informed from the bar about the following common
cause facts: The respondents’ attorneys
assisted them in an
application to evict unlawful occupants from the property and; the
legal costs in relation thereto was in an
amount of R900 000,
for the account of the trust. Whilst this appeal was pending, the
respondents’ attorneys, applied
for the sequestration of the
trust on the basis of the fee of R900 000 allegedly due to them
and served the application on
one of the respondents. This is truly
an astonishing aspect on which I will comment further later.
[41]
There does not appear on the face of it to be a prohibition, in terms
of the settlement agreement or otherwise, against the
disposal of the
property, provided that it is effected in accordance with the
informed and properly expressed view of the community.
It is
necessary at this stage to consider how government, through the
Minister, saw the object of the settlement of the land claim.

Government was rightly concerned with the pain caused to the
community by historical dispossession and was intent on seeing prime

land being occupied by black families who had been so dispossessed.
At paras 37.1 and 37.3 of the opposing affidavit on behalf
of the
Commissioner and the Minister, the following appears:
’
37.1
The Minister saw the Ndabeni land claim as an opportunity to set in
motion a visionary process that promoted an integrated
and
sustainable, transformed post-apartheid City of Cape Town, bearing in
mind that the Ndabeni community occupied approximately
54.8 hectares
of land within the City, before being forcibly removed to the outer
limits of the City. Consequently, the award of
prime strategic land
within the Cape Town metropole was considered to make enormous
inroads into the still existing apartheid spatial
planning of the
City;
.
. . .
37.3
Whilst the pattern of having African people live out at the outer
reaches of the City of Cape Town is still visible today,
the Minister
took the view that by allowing African people to gain access to a
land parcel which is close to the City, employment
opportunities,
services and transport routes, the face of Cape Town will be
radically altered. Moreover, the Minister was aware
that the land
parcel has enormous development potential, whether used for
residential, industrial, commercial or entertainment
purposes. It was
therefore fitting that such an opportunity be afforded to the
claimants, as it will give effect to a city that
represents a more
cosmopolitan and integrated feel.’
[42]
I turn to deal with the judgment of the court below. At the outset,
the court below (Nuku J) criticised the Master, the Minister
and the
Commissioner’s application for condonation for the late filing
of their answering affidavits. Nuku J referred to
the reasons for the
late filing:
[6]
(i)
the matter is complex;
(ii)
the matter is very important;
(iii)
the officials who had to consult with the legal representatives were
not available;
(iv)
the applicants will not suffer any prejudice;
(v)
the failure to introduce the affidavit will result in the members of
the trust being deprived of their Constitutional right
to enjoy the
land awarded to them; and
(vi)
there are good prospects of successfully opposing the application.
After
doing so, the court below went on to state the following:
[7]
‘
The
first respondent gave no explanation at all for the late filing of
the answering affidavit but instead she associated herself
with the
third and fourth respondent’s application. The reasons advanced
by the third and fourth respondents have no bearing
at all on the
first respondent who had previously issued Letters of Authority to
various persons to act as trustees of the Trust.
The
reasons advanced by the third and fourth respondents for the failure
to file the answering affidavit timeously are hopelessly
inadequate.
The third and fourth respondents blame their legal representatives
for the delay as the legal representatives had to
acquaint themselves
with a considerable amount of documentation. Notably, this is not
confirmed by any of the third and fourth
respondent’s legal
representatives. The delay is also blamed on unnamed officials who
had to commute from Pretoria to consult.
Once again, no affidavit is
filed by any of the said officials . . . .’
Notwithstanding
his stated reservations, Nuku J proceeded to hear the parties’
submission on the merits of the application.
[43]
Adjudicating the merits, Nuku J said the following about the
allegations made by the Master against the respondents concerning

complaints made to that office:
[8]
‘
The
first respondent refers vaguely and without any details to
allegations of corruption, intimidation and improper administration

of the Trust without disclosing the names of the persons who have
lodged these complaints nor any confirmatory affidavits from
them.
The only person who appears to have done something about her
unhappiness with regard to the conduct of the applicants is
the
second respondent, and this is dealt with when dealing with her basis
for opposing the application.’
[44]
The court below rejected the submission on behalf of Ms Fesi that
such members of the trust as could be identified had to be
joined as
parties to the litigation. It did so on the following basis:
[9]
‘
There
is no merit in the submission that the applicants should have joined
the members of the Trust. The issue that the applicants
have
approached the Court with is narrow and concerns the directions
issued by the first respondent. The second respondent provides
no
basis why the members of the Trust should be joined and I cannot find
any.’
[45]
In para 23 of the judgment the court below took the view that the
agreements in terms of which the property was disposed of
were
concluded when the respondents were holders of letters of authority.
It went on to state:
‘
The
second respondent has instituted proceedings in which she seeks,
inter alia
,
an order declaring the agreement entered into between the trustees of
the Trust and Abacus invalid, and this matter is still pending
before
this Court. These are the proceedings which presumably resulted in
the first respondent deciding not to issue the Letters
of Authority
initially, as she regarded the matter
sub
judice
. The fact that an
action has been instituted to impeach one of the transactions that
the trustees concluded cannot and does not,
on its own, disqualify
them from holding office as trustees. Until the agreement has been
declared void by a competent Court of
law, or is cancelled by any of
the parties to the agreement, it remains binding on the Trust. An
intention by the applicants to
execute contracts concluded by the
Trust with third parties cannot be a basis for the first respondent
refusing to issue Letters
of Authority to the applicants.’
[46]
Insofar as the elections of the respondents in 2016 was concerned,
the court below said the following:
[10]
‘
The
second respondent’s challenge to the election of the applicants
is based on her understanding that an annual general meeting
of the
Trust can only be viewed as duly constituted if notices have been
given to all members as required by the Trust Deed. Clause
21.2 of
the Trust Deed states that: “
The
notice convening meetings shall be in writing and may be given in
such manner as the Board of Trustees may from time to time deem

appropriate; . . .” . In his affidavit, Mr Mguga states that
the required notice was given to the members. The second respondent

does not assert that she never received the notice nor does she
provide details of the members of the Trust who did not receive
the
notice of the annual general meeting.’
Later,
in para 34, the court below said:
‘
Although
there was some correspondence exchanged between the first respondent
and the applicants and/or their legal representatives,
the first
respondent never questioned compliance with the Trust Deed in
relation to the election of the applicants. It is only
during these
proceedings that the third and fourth respondents seek to impugn the
elections, and in doing so, they can only rely
on the version of the
applicants, as the deponent to the third and fourth respondents’
answering affidavit has no first-hand
information relating to the
annual general meeting in which the applicants were elected.’
[47]
In respect of the assertion by the parties opposing the relief sought
by the respondents, namely that the meeting at which
they were
elected was not quorate, the court below said:
[11]
‘
The
third and fourth respondents challenge the election of the applicants
on the basis that the meeting, at which the applicants
did not have
the
quorum
,
in that there were less than 50 members of the Trust present at the
meeting. The Trust Deed defines members as “those natural
and
juristic persons as may from time to time be admitted to Membership,
upon application, and in accordance with the provisions
of clause 8”.
Clause 8.2 of the Trust Deed provides that “Membership of the
Trust shall be conferred, on application
therefor, upon the following
persons . . . [A]ny other natural or juristic person [Institutional
Member] whom the trustees are
reasonably satisfied is entitled to
participate in an award or settlement in respect of or relating to
the Ndabeni land, under
the
Restitution of Land Rights Act, 1994
”.
It is thus clear that the admission of members to the Trust was
envisaged to be an ongoing process, and that the trustees
have the
power to admit persons as members upon being reasonably satisfied
that the said persons are entitled to participate in
the award. Mr
Mguga, in his affidavit, states that the meeting was attended by 69
members, and the response by the third and fourth
respondents is that
they do not know who these individuals are and whether these
individuals were verified in terms of the mutually
agreed
verification process. That the third and fourth respondents have no
knowledge of the members referred to by Mr Mguga must
mean that this
Court only has Mr Mguga’s version that 69 members attended the
meeting and voted for the election of the applicants.’
[48]
In dealing with the assertions that the respondents, in disposing of
the property to Devco, acted improperly in that they were
faced with
a conflict of interests and could not execute their fiduciary duties,
the court below said the following:
[12]
‘
The
conflict of interest relates to the remuneration that the applicants
have been receiving from Abacus. These payments are, to
say the
least, questionable under the circumstances as the payment thereof
appears to be an incentive to the applicants to facilitate
the
execution of the agreements entered into between the Trust and
Abacus. These payments, however, do not disqualify the applicants

from holding office as trustees. The second respondent, as do other
members of the Trust, have remedies against the applicants
in respect
of these payments.’
[49]
In relation to the question of the verification of membership the
court below concluded as follows:
[13]
‘
The
issue of the verification of the members is an ongoing process that
will have an impact on the members’ register. The
verification
of the members of the Trust has not been finalised and as such, there
cannot be an accurate members’ register
before the process is
finalised.’
[50]
The court took the view that the decision by the Master not to
appoint the respondents was administrative action as contemplated
in
s 1
of the
Promotion of Administrative Justice Act 3 of 2000
. Nuku J
observed that the respondents had not taken that decision on review
but went on to hold as follows:
[14]
‘
To
insist on the applicants proceeding by way of review in the face of
patent unlawfulness would be defeating the provisions of
section 23
of the Act. In any event, that would be insisting on form over
substance. The appointment of the trustees is subject
to the
supervision of the Court.’
[51]
He concluded as follows:
[15]
‘
In
the circumstances of this case, it is clear that the first
respondent, when approached by the applicants for Letters of
Authority,
concerned herself with matters that were not relevant for
the purposes of issuing the Letters of Authority. The issue of
issuing
Letters of Authority is not something that requires some
experience and/or expertise. In fact, the first respondent had
initially
indicated her willingness to consider the issuing of the
Letters of Authority to the applicants until she became aware of the
action
brought by the second respondent. She had initially indicated
her intention to abide the decision of this Court when the applicants

instituted these proceedings until she changed her stance for reasons
that are difficult to understand. This Court is in as good
a position
as the first respondent to make the decision regarding the issuing of
the Letters of Authority.
The
Trust has been without trustees for a period of just over six months,
and such a state of affairs is undesirable. The interests
of the
beneficiaries have been put on hold as a result of the vacuum which
has been created by the first respondent’s refusal
to issue the
Letters of Authority. In my view, the applicants were justified in
bringing the application on an urgent basis.’
[52]
Nuku J made an order directing the Master to issue letters of
authority to the respondents and ordered the opposing parties
to pay
their costs. It is against that order and the conclusions leading up
to it that the present appeal by the Master and Ms
Fesi is directed.
It is necessary to record that although the Minister and the
Commissioner participated quite vigorously in the
court below, they
regrettably did not participate in the appeal.
[53]
Before us, both Ms Fesi and the Master, in their heads of argument
submitted, at the outset, that the respondents were not
entitled to
approach the court for an order compelling the Master to issue
letters of authority. They contended that the proper
procedure would
have been for the respondents to launch an application in terms of
PAJA and in accordance with Rule 53 of the Uniform
Rules, to review
and set aside the decision by the Master to not issue the letters of
authority. In this regard it was contended
on behalf of the Master
that the principle set out in the decision of this court in
Oudekraal
Estates (Pty) Ltd v City of Cape Town & others
2004 (6) SA 222
(SCA) should apply, namely, that the Master’s
decision remains valid until set aside by way of review.
[54]
Section 23 of the Act on which the respondents based their
application in the court below provides as follows:
‘
Any
person who feels aggrieved by an authorization, appointment or
removal of a trustee by the Master or by any decision, order
or
direction of the Master made or issued under this Act, may apply to
the court for relief, and the court shall have the power
to consider
the merits of any such matter, to take evidence and to make any order
it deems fit.’
This
kind of review is dealt with by Professor Hoexter
[16]
under the heading ‘Special statutory review’ (at 113) as
distinct from a PAJA and other types of review.
[17]
She points out that this is sometimes a wider power than ordinary
review and thus more akin to an appeal but that it might well
be
narrower with the court being confined to particular grounds of
review or particular remedies. It would, of course, depend on
the
relevant statutory provisions. In
Nel
& another NNO v The Master (ABSA Bank Ltd & others
intervening)
2005 (1) SA 276
(SCA), para 22-23, this court, with reference to
Johannesburg
Consolidated Investment Co v Johannesburg Town Council
1903
TS 111
, discussed statutory reviews of the kind in question and
endorsed Professor Hoexter’s exposition. In Honoré at
191,
para 119, the authors, in dealing with the power of the court
when there is a challenge in terms of the Act in relation to the
Master’s
appointment
of trustees point out, with reference to s 23, that the terminology
of that section makes it plain that the court may consider
that
disputed issue anew.
[18]
At
para 154 (page 251) of Honoré, the learned authors note that
all
the Master’s decisions in terms of the Act are subject to
reassessment by the court. They go on (page 252), to state that
s 23
makes it plain that the substantive justification for any action by
the Master may be scrutinised. They also state the following:
‘
[T]he
substantive justification for any action by the Master may be
scrutinised. The applicant will in other words not have to establish

that the Master committed a reviewable irregularity but only that
there are grounds for the court to substitute a decision it considers

better. The court is expressly empowered “to consider the
merits” of the matter, to take evidence “and to make
any
order it deems fit”. This goes further than the entitlement to
administrative justice now embodied in statute under the

Constitution.’
[55]
The respondents were entitled to approach the court for relief in
terms of s 23 of the Act on the basis set out in the preceding

paragraph. No practical purpose is served debating whether Rule 53 or
Rule 6 of the Uniform Rules ought to have been employed,
the
essential question is whether relevant and sufficient facts were
before the court enabling it to adjudicate the claim for relief.
In
this regard see
Rampa
en andere v Rektor, Tshiya Onderwyskollege en andere
1986 (1) 424 (O) at 429G-H. See also Harms
Civil
Procedure in the Magistrates’ Court
2017 SI 42.
As will become evident, in the present case the necessary
facts were before the court to enable the respondents’ claim
for
relief and the grounds of opposition, with reference to the
relevant statutory provisions, to be adjudicated.
[56]
I now address the reasoning of the court below and whether the
conclusions arrived at were correct. A starting point is to
consider
the office of trustee and the supervisory powers and obligations of
the Master in terms of the Act. First, for proper
accession to the
office of trustee the following conditions must be fulfilled:
(i)
appointment in a lawful manner;
(ii)
proper qualification on the part of the trustee;
(iii)
acceptance of the office; and
(iv)
written authorization by the Master.
[19]
[57]
In Honoré
South
African Law of Trusts
,
the learned authors point out that the public law dimension of trusts
emerges clearly from the court’s control over the
performance
by trustees of their duties in terms of the Act which also gives the
Master of the High Court extensive supervisory
powers over the office
of trustee.
[20]
They also deal
with the administrative and substantive aspects of the powers of the
Master. Amongst the substantive provisions
are those in terms of
which the Master can call upon trustees to account for the
administration and disposal of trust property,
to deliver books and
documents and to answer questions put by the Master. Furthermore, the
Master is empowered in terms of the
Act to launch investigations into
the trustee’s administration and disposal of trust
property.
[21]
In appropriate
circumstances, the Master may apply for a court order to direct
trustees to comply with a request by the Master
or with any duty or
for the removal of a trustee.
[22]
[58]
As to the first requirement set out in para 56 above, namely the
lawful appointment of a trustee, it must at the outset be
noted that
the office of trustee is created by a trust instrument and is to be
filled as specified in the trust instrument, or
by the Master, or by
the court. In
Metequity Ltd & another v NWN Properties Ltd &
others
1998 (2) SA 554
(T) at 557G-H the following appears:
‘
A
trustee is defined as any person who acts as trustee by virtue of an
authorisation under    section 6. That section

envisages in section 6(1) that the Master’s authorisation to
act as trustee is granted to persons appointed as trustees in
a trust
instrument, by the Master or by the court. The office of trustee is
therefore created by the trust instrument and filled
thereby or by
the Master or the court. The Trust Property Control Act, however, as
a regulatory and control measure, provides in
section 6 that such
existing trustee shall not act without authorisation by the Master.’
[59]
In terms of the trust deed in the present case, trustees are to be
elected at successive annual general meetings. Notices are
required
in terms of clause 22.1, to be delivered ‘to all Members either
personally or by prepaid registered post, addressed
to the last known
address notified by such person to the Trust; or in such other manner
as may be deemed appropriate by the Board’.
A quorum is stated
to be the lesser of 50 members or 10 per cent of the members
reflected in the membership register from time
to time.
[60]
It is clear from what is set out earlier that the trust has a history
of being dysfunctional and has for more than a decade
not served the
needs of the community. Against that background, and considering the
importance of ensuring compliance with the
constitutional objectives
of land restitution, and with the best interests of the community at
heart, the determination of the
Minister, the Commissioner and the
Master to ensure that the trust deed was complied with and that the
membership list was verified
to enable the trust to be functional and
effective in the interests of the community, is easily understood.
The attitude of the
Minister and the Commissioner is all the more
justifiable if regard is had to clauses 11.1 and 13 of the settlement
agreement,
referred to above,
[23]
which provide for their continued involvement. Their insistence that
the verification process be concluded in order for the trust
deed and
the settlement agreement to be complied with is in accordance with
the general principles of trust law that a trust should
not be
allowed to fail for want of a trustee/trustees.
[24]
Simply put, the objective was to ensure the appointment of trustees
in accordance with the trust deed so as to ensure that the
objectives
of the trust were met.
[61]
At this stage it is necessary, for a better and proper appreciation
of the highly emotive question of land restitution and
reform and the
related concerns of the Minister and the Commissioner regarding the
disposal of the property, to have regard to
what is set out by the
Constitutional Court in
Land Access Movement of South Africa &
others v Chairperson of the National Council of Provinces &
others
2016 (5) SAA 635 (CC) para 1, which reads:
‘
This
matter concerns the painful, emotive subject of colonial and
apartheid era land dispossession. A subject that – despite
the
democratic government’s efforts at resolution through the
Restitution of Land Rights Act (Restitution
Act) – continues to
plague South Africa’s politico-legal landscape. To those who
personally experienced the forced
removals and those who –
instead of inheriting the illegitimately wrestled land –
inherited the pain of loss of homes
or property, the dispossession
are not merely colonial and apartheid era memories. They continue to
be post-apartheid realities.
And it is understandable why that should
be so. At the risk of being presumptuous, here was the upshot: the
ejection from homes;
the forcible loss of properties; severing from
kin, friends and neighbours; the wrenching of those affected from
their beloved
connection to place and community; immeasurable
emotional and psychological trauma; and the searing bitterness of it
all. Concomitant
to this was an untold assault upon the dignity of
those at the receiving end of this distressing treatment. The
continuing post-apartheid
realities of land dispossession are more so
in the case of those who are yet to enjoy the fruits of restitution
or equitable redress
in terms of the Restitution Act.’
(Footnotes omitted.)
It
is also imperative that the duties of the trustees in relation to the
affairs of the trust and especially in relation to the
disposal of
the property be seen against that background.
[62]
It is common cause that the agreed verification process referred to
above had not been followed through to an acceptable conclusion.
It
is baffling that the respondents’ attorney, despite having
engaged in lengthy discussions concerning the verification
process
and finally agreeing to a process to that end, rushed off to court on
an urgent basis to seek the relief ultimately granted
by the court
below. The explanation that the trust had to be urgently functional
to deal with arrears in rates and the threat of
unlawful invasion
appears to be a smokescreen for what compellingly appears to be the
motivation for the approach to court, namely,
the hasty sale of the
property to Devco. The dysfunctional history of the trust was used as
a cover for the urgent approach to
court. As pointed out, these
problems have been extant for more than a decade. Furthermore, the
attitude of the respondents and
their attorney, namely that since a
verification process had been agreed there was thus no impediment to
the letters of authority
being issued is, simply postulated, putting
the cart before the horse.
[63]
Absent a verified list, notices in the terms set out in para 59
above, could not be given to all the members entitled to receive

them. An annual general meeting could thus not be properly convened
and a quorum could certainly not rightly be determined. The
problem
was compounded by the chaotic nature of the meeting as described by
the chairperson of the respondents in para 39 above.
It follows
inexorably that the respondents could not possibly have been validly
elected in accordance with the trust deed. It is
clear from the
Master’s opposing affidavit that after summons was served, the
Master’s primary concern was whether
the respondents were
properly elected. That question is one of legality rather than
discretion. From what is set out above, it
is clear that a letter of
authorisation from the Master could only follow upon appointment in
accordance with the trust deed.
[64]
The Master was also rightly concerned about the pending litigation
initiated by Ms Fesi’s summons, which included questions

concerning the propriety of their election, the legality of the
disposal of the property, and whether the respondents conducted

themselves in a fiduciary manner. It is necessary, briefly, to have
regard to the meeting convened during September 2016, referred
to in
para 28 above, where the respondents decided to ratify the decision
to dispose of the property. Although the property was
sold during the
prior tenure of the respondents, no special notice appears to have
been given of the intended disposal of the property.
In the absence
of a satisfactory verification process, such notices could hardly
have been given to all the members entitled thereto.
The purported
ratification meeting was held at a time when letters of authority had
not been issued and the resolution passed at
the instance of the
respondents appears on the face of it to be of no force and effect.
Written authorisation by the Master in
terms of s 6 of the Act is a
precondition to trustees acting in that capacity. In Honoré
the learned authors state the following
in para 131 at 219:
‘
The
language of the section is empathic: someone appointed as trustee
“shall act in that capacity only if authorized thereto
in
writing by the Master”.’
Further,
at 220, the authors state:
‘
It
was accordingly held in
Simplex
v Van der Merwe
that
trustees appointed in terms of a trust deed who had accepted
appointment as such, but whom the Master had not yet granted
statutory authority to act in that capacity, could not validly
conclude a contract so as to bind the trust. Acts performed without

the Master’s written authorization were null and void, could
not be cured retrospectively by the trustees themselves, after

receiving authorization, or by the Master or the court. The court
pointed out that the whole scheme of the Act “is to provide
a
manner in which the Master can supervise trustees in the
administration of trusts properly and s 6(1) is essential to that
purpose”.
By placing a bar on trustees from acting as such
until properly authorized “the Act endeavours to ensure that
trustees can
only act as such if they comply with the Act. This
ensures that the trust deed is lodged with the Master and that
security, if
necessary, is lodged” before trustees start
binding the trust property.’ (Footnotes omitted.)
[65]
The court below did not approach the matter on the basis set out
above. It began with an unjustified criticism of the late
filing of
the application for condonation for the late filing of affidavits on
the part of the Minister and the Commissioner. The
issues related to
the trust, about which the respondents all complained, were factually
complex and of public importance and the
history of the matter had to
be pieced together and consultations, of necessity, had to take
place. The explanations proffered
by the Minister and the
Commissioner were not wholly inadequate.
[66]
The court below erred in being too readily dismissive of the Master’s
concerns, following upon complaints about the conduct
of the trustees
in relation to the disposal of the property. Furthermore, the court
below ought to have been more attuned to the
interests of all the
members of the community. The contention on behalf of the appellants,
that as many community members as could
be located ought to have been
joined in the proceedings in the court below, was not without merit.
The court’s acceptance
of Mr Mguga’s statement, in his
affidavit, that the required notice was given to community members of
the meeting at which
the respondents were elected was too readily
accepted as being sufficient.
[67]
The court below recognised that the payments by Abacus to the
respondents were ‘to say the least, questionable’.
That
notwithstanding, the court held that this did not disqualify the
respondents from being entitled to hold the office of trustee.
[68]
The contention, before us, on behalf of the respondents that the
Master had firmly intended to authorise them to act before
a change
of attitude leading to the refusal to issue letters of authority, and
that the refusal was an act beyond the Master’s
authority in
terms of s 6(1) of the Act, is not borne out by the exchange of
correspondence between the Master and the respondents’

attorney, as set out in paras 29-33 above. The Master was considering
whether to issue the letters of authority, but finally made
the
decision not to do so after the sequence of events referred to above
and after concerns were raised about the legality of the
election
process which the Master thought best determined by a court.
[69]
To sum up, the election of the respondents was for the reasons set
out above, not in accordance with the trust deed. That alone

disentitled the respondents to the relief sought and granted. It was
dispositive of the dispute in the court below and is of this
appeal.
This was a case in which there were bright flashing lights and sirens
wailing against the grant of letters of authority,
which the Master
rightly heeded. For all of the reasons set out above, the Master’s
refusal to issue letters of authority
was clearly justified.
[70]
Public office bearers featuring in litigation in which their conduct
is called into question often face public scrutiny and
denunciation.
They very rarely receive accolades for performing their duties
commendably. In the present case the Master, the Minister
and the
Commissioner all acted in a manner that was laudable. They were all
intent on ensuring that the objectives of the trust
were met and that
the importance of land restitution and its benefits for formerly
displaced communities were taken into account.
Importantly, they were
ensuring that constitutional objectives were promoted and protected.
[71]
I return to an aspect alluded to above, namely, the conduct of both
the respondents and their attorney leading up to the litigation
in
the court below and thereafter. As stated earlier, the attorney
agreed on behalf of the respondents to follow a process to verify

membership of the community, but nonetheless rushed to court before
it was finalised. The compelling conclusion is that the urgent

approach to court was meant to expedite and finalise the sale of the
property in question. The application for sequestration of
the trust
because of fees owed to the respondents’ attorneys, ostensibly
by the trust, has to be viewed with a great degree
of disquiet. It
was resorted to despite the pending litigation by Ms Fesi and the
present appeal. One might rightly ask, how in
the absence of letters
of authority, which are a pre-condition for trustees to act in that
capacity, the respondents’ attorney
could have taken
instructions on behalf of the trust to eject unlawful occupants from
the property, entitling him to charge fees,
which was the debt on
which the application for sequestration was brought. In similar vein,
how could one of the six respondents,
in the absence of letters of
authority, accept service on behalf of the trust? This could not have
been lost on the respondents’
attorney.
[72]
The respondents’ contention that the assistance they had thus
far received from their attorney, whilst without funds,
in the best
interests of the community, was something that redounded to the
credit of their attorney, has a distinctly hollow ring
to it. The
calamitous consequence of the trust being sequestrated, to the
detriment of the long suffering community, was callously
disregarded.
In light thereof, the statements on behalf of the respondents,
referred to in para 40 above, heralding the nobility
of their
attorneys for thus far providing services to the trust without
charge, perhaps later to be recovered, smacks of hypocrisy.
For
completeness, I record that counsel representing the respondents was
invited to make submissions concerning the conduct of
the attorney
and possible censure. The attorney was in court and instructions were
taken. The submissions on his behalf were that
he had acted properly
and within the bounds of the law. In my view the respondents and
their attorney conducted themselves in a
manner that, at the very
least, was questionable.
[73]
For the reasons set out above, the following order is made:
1.
The appeal is upheld with costs, including the costs of two counsel.
2.
The order of the court below is set aside and substituted as follows:
‘
1.The
application is dismissed with costs including the costs of two
counsel where so employed.’
_____________________
M
S Navsa
Judge
of Appeal
Appearances:
For
the first appellant:

M Schreuder
Instructed by:
The State Attorney, Cape
Town
The State Attorney,
Bloemfontein
For
the second appellant:
B Joseph (with him L O’Conner)
Instructed by:
Du Plessis Hofmeyr Inc.,
Somerset West
Symington & De Kok,
Bloemfontein
For
the respondent:

B J Manca SC
Instructed by:
Edward Nathan Sonnenbergs
Inc., Cape Town
Claude Reid Inc.,
Bloemfontein
[1]
The Commissioner and the Minister
were the third and fourth respondents in the court below and
participated in those proceedings.
They did not, however,
participate in the present appeal.
[2]
The Land Claims Commission was
established in terms of s 4 of the Restitution Act. Section 4(3) of
the Restitution Act provides:
‘
The
Commission shall consist of a Chief Land Claims Commissioner
appointed by the Minister, after inviting nominations from the

general public, a Deputy Land Claims Commissioner similarly
appointed and as many regional land claims commissioners as may be

appointed by the Minister.’
The
third respondent, the Western Cape Regional Land Claims Commissioner
is one such commissioner.
[3]
(i) The Department of Land Affairs;
(ii)
The Department of Defence (including the South African National
Defence Force);
(iii)
The Department of Provincial and Local Government; and
(iv)
The Department of Public Works.
[4]
Clause 5 records, under the title
‘FULFILMENT OF CONDITION PRECEDENT’, that the agreement
was due to be confirmed
and adopted by resolution passed at a
general meeting of the members of the trust in the manner dictated
by the trust deed.
[5]
Clause 13 reads as follows:
‘
The
implementation of this Agreement; and issues involving the meaning
and effect of its terms; and other matters arising therefrom
or
incidental thereto, remain subject to the mandate, powers and
jurisdiction of the Minister of Agriculture and Land Affairs,
the
Commission, the Chief Land Claims Commissioner, and the Court,
respectively, as may be contemplated by statute or common
law.’
A
further relevant clause of the trust deed is clause 11.1, the
material parts of which provide:
‘
The
Parties agree to co-operate and to render each other mutual
assistance within the ambit of this
Agreement,
in order to facilitate communication and promote the successful
implementation of this Agreement according to its intent
and
purpose. With a view to achieving these shared objectives, it is
proposed to establish a Liaison Committee, which shall include

representatives of the Trust and of the various Departments
concerned, including the SANDF. . .’
[6]
In para 6 of the judgment.
[7]
Paras 10 and 11 of the judgment in
the court below.
[8]
Para 20.
[9]
Para 22.
[10]
Para 24.
[11]
Para 35.
[12]
Para 26.
[13]
Para 27.
[14]
Para 36.
[15]
Paras 37 and 38.
[16]
C Hoexter
Administrative
Law in South Africa
2 ed
(2012).
[17]
See 112-114 for a discussion of types
of review in South African law.
[18]
Cf
Shenker
v the Master
1936 AD 136.
In Honoré the authors note that that decision is in direct
contrast with the provisions of the Act.
[19]
In this regard, see Cameron
Honoré’s
South African Law of Trusts
5 ed 2002 para 110 at 179. See also s 6(1) of the Trust Property
Control Act which provides that a person can act as a trustee
only
if authorised thereto in writing by the Master.
[20]
Op cit
para 111 at 180.
[21]
See also s 16 of the Trust Property
Control Act 57 of 1988.
[22]
See ss 19 and 20 of the Act.
[23]
See note 4 infra.
[24]
See Honoré,
ibid
para 122 at 201.