Empowering trustees
in a complex world
The trustees of family or testamentary trusts often don’t realise that they could be held liable if they fail in their duty to manage the trust in accordance with the stipulations of the trust deed. It’s therefore crucial that all trustees undergo trustee training to ensure they’re well equipped to always act in the best interests of the beneficiaries.
The representative trustees of family or testamentary trusts are usually family members of the person setting up the trust. In terms of the Trust Property Control Act 57 of 1988, all trustees, including independent trustees, can be held liable if they don’t perform their duties and exercise their powers with the care, diligence and skill that can reasonably be expected from a person who manages the affairs of another.
Section 9(2) of the Act stipulates that any provision in any trust deed will be void in so far as it would have the effect of indemnifying trustees against liability for breach of trust or failing to perform their duties.
The obligations and responsibilities of trustees can be complex – to empower them to understand their roles and give them the information they need to carry out their duties, it is recommended that all trustees, other than trustees with experience as such, undergo some form of trustee training. At the very least, such training should include legal and regulatory requirements.
The duties of trustees in principle include:
Trustees must ensure they are well acquainted with and observe the terms of the trust deed. The trust deed is the founding document and essentially the ‘constitution’ of the trust. This document will usually contain:
Trustees in office should also have a general understanding of:
Sanlam Private Wealth offers training to trustees on all aspects of trusteeship as set out above. To book a trustee training session, or for further information, please contact Stanley Broun on +27 (0)11 778 6648 or stanleyb@privatewealth.sanlam.co.za.
The formation and registration of trusts, and the provision of independent trusteeships – both local and offshore.
The creation of BEE, charitable, special and Shariah trusts compliant with regulatory and legislative requirements.
The administration of deceased estates in South Africa and abroad.
Advice on complex structures, asset restructuring and bequests in foreign jurisdictions.
Advice on emigration and immigration, foreign earnings and the application of any double taxation agreements.
Updating trust deeds to ensure they’re in line with the latest changes in the trust environment.
Updating and/or drafting of wills dealing with South African and/or foreign assets.
Advice on the establishment and management of charitable organisations, their tax status and tax deductible donations.
Advice on the potential tax consequences and reporting obligations if you hold a US passport or green card, or if you have children living in the US.
Guidance on the financial implications of life-changing events, such as getting married, divorce or the birth of a child.
