MASHOKO v MASHOKO/CHIKOSI FAMILY TRUST & ANOR 2011 (1) ZLR 319 (H)

Flynote

Trust “ trustee “ duties “ removal from office by court “ grounds for

Headnote

In deciding whether or not to dissolve a trust or remove a trustee, the court has to be satisfied that the continued trusteeship does not endanger the interests of the trust and its beneficiaries.

A trustee must observe fiduciary duties when executing his duties. The three main principles which govern the administration of trusts are:

• (1) the trustee must give effect to the trust instrument so far as it is lawful and effective

• (2) the trustee must exercise his or her powers with care, diligence and skill which can be reasonably expected of a person who manages the affairs of another

• (3) except as regards questions of law, the trustee is bound to exercise an independent discretion.

The courts must be guided by the welfare of beneficiaries when faced with the task of dissolving a trust or removing a trustee from office. Some of the commonly accepted grounds for the removal of a trustee from office are:

• (1) where, without explanation, a trustee transfers trust funds from a safe investment into a personal account;

• (2) where a trustee deliberately refrains from advising a co-trustee of a decision to be taken on behalf a trust;

• (3) where a trustee treats trust property as his own; and

• (4) where a trustee allows grave misconduct by a co-trustee in the administration of the property of the trust and thus exercises no control over trust property.