The alarming answer is most probably not, because ninety percent (90%) plus of trust deeds (and/or amendments to trust deeds) on which legal audits have been done in South Africa may not stand the test of validity if it should be tested in a court of law. The fact that a trust deed has been filed at the office of the Master of the High Court, is no guarantee for its validity in that it is not the Master’s duty to check for validity.

There are various reasons for the invalidity. One of which is the different legal systems that apply in the South African Trust Law but the main culprit may be to allow the trustees too wide a discretion when it comes to the choice of beneficiaries, thus allowing the trustees a so-called general power of appointment or right to choose which then also cause the object of the trust to become vague. Often also the absence of an agreement between the founder and the trustees upon the creation of the trust, where the trust is merely created by the founder with no indication of how it is done is indicative of invalidity, etc. Other problems which often occur in the trust deed include the incorrect structuring of the beneficiaries by stating the beneficiaries shall include “blood and other relations”, testamentary reservations, de facto control given to one or more trustees which may cause the trust deed to become his alter ego, no power to create roll-over trusts which is important for the family relationship plan and the unbundling of trust assets. These may not necessarily render the trust invalid but it can cause serious family feuds, unnecessary legal costs with court applications and making life plain miserable for trustees and beneficiaries of these ill fated trust deeds. Moral of the story: prevention is better and in this case much cheaper than cure by having your trust deed properly checked, analysed and if in need rectified before any dispute occur.