Jan 29, 2022 | Article
News of this week’s landmark CCMA ruling that the dismissal of an employee for refusing to be vaccinated against Covid-19 was fair has upped the stakes on workplace vaccination policies. The commission ruled that she could be dismissed because she had ‘refused to participate in the creation of a safe working environment’.
As legal writer Tania Broughton reports on the GroundUp site, the ruling, by Gauteng commissioner Lungile Matshaka, is the first to come to light on the issue of workplace mandatory vaccine policies. Goldrush Group business and training officer Theresa Mulderij, was appealing against her dismissal for ‘incapacity’. She wanted to be either reinstated or fully compensated.
At the hearing, company representatives explained the steps leading up to the adoption of its mandatory workplace vaccination policy. They said consultations had been held with unions and employees over a three-month period. Staff had been given an overview of the benefits of vaccination. Specialists, including a doctor, traditional healer, virologist and a human rights commissioner had been made available to answer questions. The policy included a provision for exemption. Mulderij applied for an exemption but was turned down. According to Matshaka’s ruling, she had first attempted to get a medical exemption, but no doctor had been willing to assist her. She then relied on her constitutional right to bodily integrity. This application was turned down by the exemption committee. ‘The committee identified her as a high-risk individual who interacts with colleagues daily whilst on duty in confined, uncontrollable spaces. This, according to the committee, put her at risk and exposes other colleagues to risk,’ the commissionersaid.
Matshaka said he had listened carefully to what Mulderij had said at the CCMA hearing: that she had a constitutional right to bodily integrity; that she felt extreme social pressure and emotional discomfort about deciding between her livelihood and accepting the vaccine under current conditions; and that she did not trust the vaccine and had a personal fear as to what it might do to her.
She had said since the beginning of lockdown, she had strictly followed Covid protocols, both general protocols and those introduced by the company. To her knowledge, she had not yet been infected or infected anyone else, notes the GroundUp report. ‘She is aware that it has been confirmed by the World Health Organisation that the vaccine does not stop the spread or contraction of the virus, but only serves to minimise the severity of symptoms. She does not believe that this vaccine is for the greater good or wellbeing of people but only for the good of the individual themselves,’ the commissioner said. He The Commissioner that said the mandatory workplace vaccination policy, from its drafting up to its implementation, had followed all the crucial steps. He could only conclude that Mulderij was ‘permanently incapacitated’ on the basis of her decision not to get vaccinated and her refusal to participate in the creation of a safe working environment.
Source: LegaBrief
Jan 29, 2022 | Article
The government has claimed that backlogs at the country’s 15 Master’s Offices have been ‘reduced significantly’, with progress having been made in stabilising the IT systems to deal with the caseload, which increased dramatically during the various stages of lockdown last year. The Department of Justice & Constitutional Development admitted to Business Day that the backlog had affected its ability to deliver services. It said these had ‘impacted negatively on the image of the Master’s Office’.
However, department spokesperson Steve Mahlangu said the Master’s Office branch in the department had been focused on ‘attending to the backlog in all the 15 offices. ‘The report from most of those offices is that a substantial number of matters have been attended to. Backlogs have been reduced significantly and all staff are continuously working hard towards returning to normal caseloads,’ said Mahlangu. ‘Significant progress has been achieved despite the challenges of load-shedding affecting offices that were doing overtime work, which made it difficult to manage the situation. Currently, our IT system has not fully stabilised, but there is progress being made.’
Source: LegalBrief
Jan 27, 2022 | Article
The markets have experienced some big bumps over the last few days due to concerns over tightening US Federal Reserve Bank’s monetary policy, and the geo-political concerns in Europe.
Source: FNB Securities
Jan 21, 2022 | Article
The removal of trustees will always be a delicate matter, especially in terms of a testamentary trust where the testator or testatrix handpicked the trustee(s). It was held in the Gowar v Gowar case of 2016 that the Court’s power to remove a trustee must be exercised with caution – it should consider whether the trustee’s conduct endangered the trust assets or its proper administration. Conflict between the trustees and/or beneficiaries is, therefore, not sufficient reason for a court to remove a trustee. The overriding factor is the welfare of the beneficiaries and the proper administration of the trust and the trust assets.
Relationship between trustees
The Court held in the McNair v Crossman case of 2019 that if the relationship between co-trustees has broken down to the extent that they no longer have any mutual respect and trust for each other, a trustee’s removal can be brought under Section 20(1) of the Trust Property Control Act since it could place the trust assets and the trust administration at risk. If none of the trustees wants to step down, the Court can remove one or more of them.
It was held in the Fletcher v McNair case of 2020 that the breakdown of a relationship between co-trustees, resulting from outside the trust, is not sufficient reason to remove a trustee. The test is whether the trust assets and its affairs are placed at risk. It cannot be assumed that as a result of a lack of trust, respect, or compatibility amongst trustees, the trust assets are placed at risk, and therefore, the trustee has to be removed.
It was held in the Haitas v Froneman case of 2021 that a trustee must first participate in trust matters before they can claim that a deadlock exists and, therefore, demand the appointment of an independent trustee. Trustees often refuse to participate in trust matters and attend trustee meetings due to a conflict with co-trustees. Trustees sometimes even refuse to attend meetings without legal representation. Trustees should rather attend these meetings and take legal advice thereafter if they so wish. Non-participation is dangerous as the trustee snookers themselves. If a trustee claimed a deadlock and requested the appointment of an independent trustee, the issue is whether or not there is a deadlock to break since they have not even engaged with their co-trustees.
Relationship between trustees and beneficiaries
It was held in the McNair v Crossman case of 2019 that the mere friction or enmity between the trustee and the beneficiaries would not in itself be an adequate reason for the removal of the trustee from office.
The Fletcher v McNair case of 2020 confirmed the following legal principles regarding the removal of trustees:
· Mere friction or enmity between a trustee and beneficiaries will not in itself be adequate reason for the removal of a trustee from office.
· Where there is disharmony between the trustees and the beneficiaries, the test is whether the relationship risks the trust estate or its proper administration.
· Neither mala fides (acting in bad faith) nor misconduct are required for the removal of a trustee.
· The important consideration is the welfare of the beneficiaries and the proper administration of the trust and the trust assets.
In the Haitas v Froneman case of 2021, the sole beneficiary wanted the trustees removed for “not doing their job”. Unfortunately, doing their job requires trustees to follow the instructions in the trust instrument and not their own judgement or that of the beneficiaries. The Court acknowledged that the trustees have, in some respects, been lax in maintaining proper accounting records of the trust. The problem actually pre-dated the death of the deceased, who did not require audited financial statements (even though that was required in terms of the trust instrument) and ran the businesses single-handedly. The Court acknowledged that it was negligent of the trustees to give the deceased free rein during his lifetime. The Court confirmed the following legal principles regarding the removal of trustees:
· The general principle is that a court will exercise its ‘common law’ jurisdiction to remove a trustee if the continuance in office of the trustee will be detrimental to the beneficiary or prevent the trust from being properly administered. A trustee has a fiduciary duty to act with due care and diligence in administering property on behalf of another.
· The Courts have taken a pragmatic approach as to what misconduct should be construed as jeopardising trust assets, and the Courts’ power to remove a trustee is one that should be used with circumspection. Regardless of whether the common law or Section 20(1) of the Trust Property Control Act is utilised, the Courts have emphasised that when a deceased person has deliberately selected certain persons to carry out their wishes because they believe they are best placed to do so, a court should be loath to interfere and remove them as trustees.
· Neither mala fides (acting in bad faith) nor misconduct necessarily warrant the removal of a trustee. Disharmony in the administration of a trust is only relevant if this exposes the trust assets. Removal of a trustee will only be necessary if it is in the interests of the trust and its beneficiaries.
· Conduct of the trustees, which the beneficiary does not like, does not on its own justify their removal. In fact, the Court has found that enmity (disharmony, hostility, friction, conflict, dislike, hatred or aversion) between the beneficiary and the trustees is not of and in itself an adequate reason for their removal. The conduct of trustees must be detrimental to the trust assets. It is only then that their conduct may warrant removal. It is not necessary that their conduct be unquestionable or faultless but generally, where there is no wrongdoing or misconduct and no financial gain on the part of trustees, the Courts will not interfere.
~ Written by Phia van der Spuy ~
Jan 21, 2022 | Article
The Constitutional Court in Bwanya v Master of the High Court, Cape Town and Others [2021] ZACC 51confirmed the ruling of the Western Cape High Court in October 2020 that section 1 of the Intestate Succession Act, 81 of 1987 (ISA), is unconstitutional in so far as it excludes life partners in a relationship intended to be permanent from the definition of “spouse”.
The majority of the held that unfair discrimination on the basis of marital status is prohibited by section 9 of the Constitution, and that any such discrimination is presumed to be unfair unless it can be shown not to be unfair.
Taking into consideration that there are indications that more than three million South Africans are in life partnerships, the court found that not to extend the right to inherit under intestate law from one another would be unfair discrimination on marital status.
The court also allowed an appeal against the ruling by the Western Cape High Court that it cannot find that the provisions of the Maintenance of Surviving Spouses Act, 27 of 1990 (MSSA), are unconstitutional, because it is bound by the earlier decision by the Constitutional Court in Volks NO v Robinson and Others [2005] ZACC 2. The court found that whether or not a life partnership existed is a factual question and that it can, therefore, decide on the facts that it existed in the current matter. The court was of the view that the decision in Volks does not bind it under all circumstances.
The court ordered, inter alia, that both section 1 of the ISA as well as section 2 of the MSSA are unconstitutional and that it should be read to include a partner in a life partnership complying with the test of reciprocal duties of care, maintenance and support. The order is postponed for 18 months to give Parliament the opportunity to amend the two pieces of legislation.
Comment:
Practically speaking executors should now seriously consider any claims from life partners under either of the mentioned acts and obtain legal advice in appropriate circumstances, as failure to consider them could result in further litigation.
Source: FISA
Dec 3, 2021 | Article
All trustees to play an active roll
Trusts are often trusts in name only, with an essential principle of trust law, namely the independence of trustees, neglected (Tijmstra v Blunt-Mackenzie case of 2002). It is, therefore, important to note that all trustees are acting in a fiduciary capacity, and no one trustee can hide behind another. A fiduciary duty is an onerous, legal obligation (a duty of loyalty and care) of a person managing property or money belonging to another person to act in the best interests of such a person. All trustees are to act with the care, diligence and skill, which can reasonably be expected of a person who manages the affairs of others (Section 9(1) of the Trust Property Control Act).
It is a fundamental rule of trust law that, in the absence of contrary provisions in the trust instrument, the trustees must act jointly if the trust’s estate is to be bound by their acts, and a unanimous vote will be required in matters of substance. The rule derives itself from the nature of the trustees’ joint ownership of the trust assets in ownership trusts. Since co-owners must act jointly, trustees must also act jointly (Coetzee v Peet Smith Trust case of 2003 and Nieuwoudt v Vrystaat Mielies case of 2004). Co-trustees are required to act jointly concerning trust administration at all times. When dealing with third parties, even if the trust instrument stipulates that a decision can be made by the majority of trustees, all trustees are required to be involved in the decision and have to sign each resolution (Land and Agricultural Bank of South Africa v Parker case of 2005).
Is more expected of the independent trustee?
Even though the Chief Master’s Directive does not require an independent trustee to be a professional person (also suggested in the Land and Agricultural Bank of South Africa v Parker case of 2005), it is in the best interests of the trust that the independent trustee has sufficient knowledge of the impact of statutory requirements on the trust, including an understanding around compliance with relevant tax law, and the effect of changes in legislation on the trust. Take note that the independent trustee, upon their appointment, must sign a Sworn Affidavit declaring that they are “knowledgeable in the law of trusts”.
The Court held in the Land and Agricultural Bank of South Africa v Parker case of 2005 that an independent trustee should be an “independent outsider” who ensures that there is adequate separation of control from enjoyment with a proper realisation of the responsibilities of trusteeship. The independent trustee should play an active role in the trust and ensure that the trust functions properly and that the provisions of the trust instrument are observed (also confirmed in the Chief Master’s Directive of 2017). The Court also held that the conduct of trustees who do not observe the trust instrument should be scrutinised and checked by the independent trustee. The Court held that any failure to observe these duties constitutes a breach of trust. That should serve as a warning to so-called ‘independent trustees’ who look the other way in their client’s wrongdoing.
The Chief Master’s Directive requires independent trustees:
To be competent to scrutinise and check the conduct of the other appointed trustees who lack a sufficiently independent interest in the observance of substantive and procedural requirements arising from the trust instrument.
To be knowledgeable about the law of trusts and not conclude or approve transactions that may prove invalid.
To have business knowledge and experience of the business field in which the trust operates.
To realise that failure to observe the duties of an independent trustee may risk action for breach of trust.
Trustees can delegate the execution of a decision
There is a big difference between abdicating responsibility and the delegation of the responsibility to execute a decision already taken. A number of estate planners and trustees get it wrong, especially when father, mother, children, family, etc. are acting as trustees, and often as “silent” or “puppet” trustees, which is not tolerated (Slip Knot Investments 777 (Pty) Ltd v du Toit case of 2011). They basically rely on one trustee, often the independent trustee, to carry the burden of trusteeship on their behalf.
However, after acting jointly, the trustees may delegate certain functions to one or more of them while retaining responsibility for the actions taken on their behalf. The acting trustee then becomes the agent of the board of trustees.
If there is reliance on independent trustees, have agreements in place
Often the estate planner and other family trustees assume the independent trustee will ‘carry’ the trust. Considering the requirement for all trustees to participate, do not assume the independent trustee will ensure the compliance of the trust on their own. Our law does not expect all trustees to be experts in all the fields (legal, accounting, taxation, and the business which the trust operates in). Each board of trustees’ skills are varying and unique; also that of the independent trustees. The board of trustees should, therefore, analyse any unique contribution each trustee can make, and formally agree with them for any unique role they will play, such as giving advice to and guide the other trustees regarding taxation matters, investments, land matters, etc. Have a formal agreement in place with the independent trustee, specifically dealing with any special role they are required to play in the trust, in line with our law and the trust instrument.
~ Written by Phia van der Spuy ~
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