The answer is most probably not because the alarming statistics here is that 95% plus of all amendments of trust deeds where beneficiaries have received benefits from trusts may not be valid in South Africa. The reason being a recent Supreme Court of Appeal Case re-emphasising the requirement of the beneficiaries who have accepted benefits from the trust to be a party to any amendment for it to be valid.

 Trust deeds can be amended in various ways i.e. in terms of the rules of the Law of Contract (see hereunder) or in terms of the derived powers as stipulated in the trust deed itself. A trust deed can also be amended by way of an application to court either in terms of the Common Law or in terms of section 13 of the Trust Property Control Act, 57 of 1988.

Where the founder is still alive an amendment of the trust deed in terms of the Law of Contract (whereby a later agreement between the founder and the trustees can amend or substitute an earlier agreement between the same parties) is the method ought to enjoy preference due to the legal certainty it brings In the light of the said recent decision by the Supreme Court of Appeal, it is also necessary that where the beneficiaries have accepted the benefits they will have to be joined as a party to any amendment, be it in terms of the Law of Contract or in terms of the derived powers given in the trust deed itself. This is because of the general principle of the contract for the benefit of a third party and that any variation to that agreement should then be conducted only with their consent. The acceptance of benefits can be done in various ways but we are of opinion that “an unequivocal expression of intention to accept” should be communicated to the trustees. Other forms of acceptance may include the distribution of benefits to a beneficiary, attendance of trustee meetings by beneficiaries, free accommodation or use of trust assets belonging to the trust, etc.