TRUSTEES, LEONARD CHESHIRE HOMES ZIMBABWE CENTRAL TRUST v CHITE & ORS 2010 (2) ZLR 631 (H)

Flynote

Practice and procedure -parties - locus standi - trustees of a trust - need for such trustee to aver his capacity - trustee not validly appointed or exercising powers after term of office has expired - no capacity to act — Practice and procedure -point of law - when may be raised-may be raised at any time if it goes to root of the matter, provided no unfairness to other party results

Trust - trustee - appointment of- validity - need for trustee to hold office in accordance with trust deed - trustee staying on after expiry of term of office - actions and decisions by such trustee invalid - appointment of trustees by court- when court may appoint trustees to ensure continuation of trust - court not entitled to assist trustees in disregard of trust deed

Headnote

"Provided it is not one which is required by a definitive law to be specially pleaded, a point of law, which goes to the root of the matter, may be raised at any time, even for the first time on appeal, if its consideration involves no unfairness to the party against whom it is directed"(dicta per Korsah JA in Muchakata v Netherburn Mine 1996 (1) ZLR 153 (S) at 157 followed).

In protracted proceedings, the plaintiffs, who were, had been or claimed to be, members of a trust established to provide homes with the necessary facilities and staff to care for the permanently disabled, sought the eviction of the defendants from its home. It was the plaintiffs' case that the defendants, who had been long term residents at that home, were no longer in need of rehabilitation. In terms of a resolution of the trustees of 30 November 1999, it was decided that the home should be closed "so as to enable it to make a fresh beginning." This was followed by a second resolution of July 2004 in which it was decided that the defendants must be evicted from the home and the present litigation, to bring this about, was authorized.

When the matter came to trial, it was revealed that C, one of the plaintiffs' witnesses who had been appointed a trustee, as at 30 November 1999, had held that position for a period in excess of five years. This was in conflict with the trust deed which provided for tenure of office of C no more than five years. The resolution of 30 November 1999 was unimpeachable because the tenure of office of three of the five trustees, who had authorized the resolution on that date, had not been trustees in excess of the permitted five years. That resolution complied with a provision of the trust deed which stated that the trust should consist of not less than two nor more than five trustees. Further difficulties, however, arose in regard to the subsequent, and crucial, resolution of 26 July 2004. In regard thereto, while new trustees had been appointed, many of the trustees had conducted trust business after their tenure of office had expired and, at one point, there were eight trustees instead of the permitted five.

Faced with all this confusion and the difficulties arising therefrom, the plaintiffs submitted that the trust deed should not be construed strictly and that the court had jurisdiction to appoint new trustees in terms of ss 7 and 9 of the Companies and Association Trustees Act [Chapter 24:04].

Held, that a point of law which goes to the root of the matter may be raised at any time, even for the first time on appeal, if its consideration involves no unfairness to the party against whom it is directed. The over-staying of the trustees was a point of law which went to the root of the case. Here, if all the trustees had over-stayed and while thus incapacitated had resolved to evict the defendants, their resolution would be invalid as they were at the time of making it not validly appointed trustees. The issue of the validity of the trustees appointments was thus crucial to the resolution of the case. Proceeding without resolving it would have been a fruitless exercise divorced from reality and would have led to a wrong decision. No unfairness to the plaintiffs was involved and the issue had to be resolved before going into the merits of the dispute between the parties. It was an appropriate case for the court to raise mero motu.

Held, further, on the facts, that in July 2004 the trust business was being conducted in contravention of the trust deed and that there was a real danger that the defendants' evictions and this litigation were authorised by persons who were not authorized to make decisions for the trust

Held, further, that the power of assumption could only be exercised by existing trustees of the trust. It could not be exercised by a former trustee whose term of office had expired.

Held, further, that while the provisions of a trust must be interpreted purposively to give effect to the objectives of the trust, that must be done without disregarding some provisions of the trust instrument. The purpose for which the trust was created could be gleaned from the whole scheme of the deed of trust and the construction must be in agreement with all the provisions of the deed of trust. Sections 7 and 9 of the Companies and Association Trustees Act did not assist the plaintiffs. Those provisions provided for the appointment of trustees by the High Court so as to ensure the continuance in existence of the trust. In casu, one was concerned with the objectives of the trust and the manner in which the trustees must hold office. The court could not disregard the trustees' failure to comply with the terms of their appointment in order to keep the trust in existence.

Quaere, whether in any event the trustees had locus standi to institute these proceedings. The general principle is that a person who is de facto administering a trust as trustee has locus standi in any matter relating to the trust; so has a person who claims to be the rightful trustee and seeks confirmation of his status.

Held, further, that the defendants' evictions were invalid and that the plaintiffs' case must be dismissed with costs.