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Business Transactions / September 1

Resolution of trustees: Clarity on the authority vs capacity conundrum

Trust deeds ordinarily contain a clause that prescribe that a trust shall always have a certain minimum number of trustees in office. Whilst is it accepted that an agreement concluded by a trust whilst the number of trustees are below the prescribed minimum is null and void, there seem to be confusion whether action by trustees on behalf of a trust whilst the number of trustees are below the prescribed minimum may be ratified after additional trustees have been appointed.

On 6 March 2026, and in Zurnamer NO and Others v JA Clift (Pty) Ltd and Others (25519/2024) [2026] ZAWCHC 106 (“JA Clift Judgment“), the High Court of South Africa, Western Cape Division (“High Court“) clarified the abovementioned confusion in the context of locus standi (legal standing) of a trust to institute legal proceedings whilst the trustees in office are below the prescribed minimum number.

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