“October, the most beautiful month of the year” - that is how South African poet, C. Louis Leipoldt, described the month of October in one of his poems. And what a beautiful sight it is when the landscapes suddenly turn into different shades of green, with a kaleidoscope of colour in between. Enjoy the beauty that Spring brings; it passes by so quickly.
 
It is also said that laughter is good for the soul. Under the constant uncertainty of the past 18 months, it would be good to look for things that can make you laugh; exercise all those muscles in your face. Laughter is contagious and possibly you might just light up someone else’s day! 
 
Ransomware attack at the Department of Justice and Constitutional Development (DOJ & CD)
As you are most probably aware by now, the extensive ransomware attack on the DOJ & CD servers had a far-reaching effect on service delivery. Various state departments, some whose services are essential to the administration of the deceased estates process, were impacted. Since 06 September 2021, when the attack took place, after more than a month of total shutdown, some progress has been made, but mostly on child maintenance and court cases. The DOJ & CD’s Information Technology (IT) Department is still working on the system to ensure full functionality in terms of trusts, deceased estates and insolvencies. A timeframe regarding a return to normal cannot be confirmed yet.
 
As described in Newsletter 53 of July 2021, backlogs were already experienced before this event took place. These backlogs were exacerbated by the recent misfortune at these state departments, which have had a detrimental effect on the administration of estates. This causes a great deal of stress on the smooth operation of processes. We are hopeful that these processes will be fully operational soon. Please be assured that we will, as always, do our utmost best to deliver the most efficient service possible, despite the difficult circumstances. We appreciate your patience and understanding, and we request that you convey this message to your clients as well.
 
Letters of Executorship
Please note that there has been and still are a delay in issuing Letters of Executorship. Legatus Trust makes use of reputable channels to assist with the obtaining of this most essential document, to enable us to proceed with the administration of estates. It may sometimes seem as if this process takes too long, but we assure you that the correct protocols are being followed to obtain this document.
 

LOOK OUT FOR THE FESTIVE EDITION NEXT MONTH.
 

INCREASE IN DEMAND FOR WILLS
Read more about this in the next edition.

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TESTAMENTARY TRUSTS: KEY ISSUES TO CONSIDER
 
A testamentary trust is specified in a Will and is established on the death of the testator or testatrix.  The Will of the deceased person forms the trust deed. No further trust instrument is required to be lodged with the Master of the High Court. The Will usually contains trust clauses on the essential elements of the trust but does not always provide detailed provisions of how the trust should be administered. This can sometimes lead to issues arising at a later stage.
 
This has been highlighted in a recent court case, Van Rensburg vs Van Rensburg N.O. and Others (24 March 2020).
 
The father and mother provided in their joint Will for a testamentary trust to be established on the death of the father for the benefit of the mother.  The trustees, all four children, had to apply the trust income and capital for the maintenance and benefit of the mother until her death.  The trust would be terminated on her death and the assets divided equally between the four children or the survivors of them. 
 
After the mother’s death, the brother requested the sister’s banking details to pay over their respective portions as stipulated in terms of the Will to terminate the trust. Unfortunately, one of the sister’s emails were intercepted, which resulted in her portion being paid into a fraudulent bank account.
 
Her siblings felt that the fraudulent act that took place was not against the trust, but that it was against her personally. The sister approached the court to remove the trustees because she felt that they were conflicted as trustees and beneficiaries of the trust. She requested that new trustees be appointed to then decide if the matter against the trustees or the brother must be pursued. She believed that they acted negligently by paying her share into an incorrect account.
 
The application proceedings covered the following issues:

 Termination of the trust and the resultant lack of beneficiaries
The main consideration was to determine the termination date of the trust.  According to the trust instrument, the Will, the termination date of the trust was upon the mother’s death. The intention of the trust was not to hold the assets for the benefit of the children, only for the benefit of the mother. The children were the ultimate legatees of the estate upon the death of the mother when the trust had to be terminated. No further beneficiaries could be appointed as the trust had effectively been terminated on the mother’s death.
 
Therefore, the sister was unsuccessful in her allegation that the trustees were conflicted due to them being beneficiaries of the trust as well. The children were not beneficiaries of the trust. Even if they referred to one another as beneficiaries in communication, it did not make them beneficiaries because they were not indicated in the trust instrument as such.
 
The lesson to take from this is to ensure that the testator/testatrix consider their wishes carefully when drafting a Will. Rights that are afforded to beneficiaries will be unavailable to such legatees. A Will should also clearly stipulate when the trust must terminate, as well as additional instructions, if any, at the termination of the trust. 

The next issue that had to be addressed was the removal of the trustees. Especially in a testamentary trust, the removal of trustees is a delicate matter.  The judge cited two previous court cases:

The Volkwyn/Damant case stated that “(it) is a matter not only of delicacy…but of seriousness to interfere with the management of the estate of a deceased person by removing from the control thereof persons who, in reliance upon their ability and character, the deceased has deliberately selected to carry out his wishes. Even if the…administrator has acted incorrectly in his duties and has not observed the strict requirements of the law, something more is required before his removal is warranted. Both the statute and the case cited indicates that the sufficiency of the cause for removal is to be tested by a consideration of the interests of the estate”.
 
The Gowar/Gowar case stated that even if disharmony may exist in the administration of a trust, that in itself is not sufficient grounds for the removal of a trustee. The Court held that “(the) overriding question is always whether or not the conduct of the trustee imperils the trust property or its proper administration. Consequently, mere friction or enmity between the trustee and the beneficiaries will not in itself be adequate reason for the removal of the trustee from office… Nor, in my view, would mere conflict amongst trustees themselves be a sufficient reason for the removal of a trustee at the suit of another”.
 
A few important principles were established by this case:

In the Van Rensburg/Van Rensburg case, the trust already terminated upon death of the mother and the role of the trustees terminated with it. The judge correctly ruled that the removal of the trustees would be needless.
 
The following is important to remember from this case:

Credit to Phia van der Spuy, Trusteeze
https://www.iol.co.za/personal-finance/case-highlights-key-issues-when-creating-a-testamentary-trust-50906003
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ESTATES BESTOWED ON THE FAMOUS – CHARLES BRONSON
 
It is quite common for people to leave their estates to famous people. Charles Bronson was one of these lucky beneficiaries.
 
Audrey Jean Knauer was a huge fan of Bronson’s. She disinherited her own relatives and made Bronson the sole beneficiary in her Will. She never met Bronson, nor was it known that she ever wrote to him, but she sure loved his movies.
 
She passed away at a young age of 55 in 1997. Her relatives were in for two surprises. Firstly, Audrey’s estate was ten times more than they suspected, amounting to just under $300,000.
Secondly, she had decided to leave her entire estate to her favourite movie star. She even went further, instructing that should Bronson not want the gift, the estate was to pass to the Louisville Free Public Library where she used to visit to research her favourite movie star.The Will was at first contested, but eventually Bronson and the sisters came to an agreement out of court and he received about half of his bequest.  The exact amounts of the settlement were never disclosed.