Master of the High Court v The Pretoria Society of Advocates and Others; Van Rooyen N.O. obo Ntzokhe v Road Accident Fund; Raphulu v Road Accident Fund; Raubenheimer obo Brian v Road Accident Fund; Segoba obo Sekwne v Road Accident Fund; Wentzel v Road Accident Fund (35182/2016;28304/2014;44200/2018;17258/2015;40258/2021;35182/2016) [2022] ZAGPPHC 396; 2022 (6) SA 446 (GP) (20 May 2022)

IN THE HIGH COURT OF SOUTH AFRICA GAUTENG DIVISION, PRETORIA 1) REPORTABLE: YES/NO (2) OF INTEREST TO OTHER JUDGES: YES/ NO (3) REVISED. __________ ______/______/______ SIGNATURE DATE CASE NO: 35182/2016 In the matter between: MASTER OF THE HIGH COURT APPLICANT and THE PRETORIA SOCIETY OF ADVOCATES FIRST AMICUS CURIAE UBERRIMA PHOENIX (PTY) LTD SECOND AMICUS CURIAE W F BOUWER THIRD AMICUS CURIAE THE SOUTH AFRICAN MEDICAL MALPRACTICE LAWYERS’ ASSOCIATION (SAAMLA) FOURTH AMICUS CURIAE FIDUCIARY INSTITUTE OF SOUTHERN AFRICA (FISA) FIFTH AMICUS CURIAE 2 PRETORIA ATTORNEY’S ASSOCIATION SIXTH AMICUS CURIAE ABSA TRUST LIMITED SEVENTH AMICUS CURIAE In re: Matters involving a report and addendum of the Master of the High Court in terms of section 96(2) of the Administration of Estates Act 66 of 1965 In re: CASE NO: 28304/2014 ADV M VAN ROOYEN N.O OBO N NTZOKHE APPLICANT v ROAD ACCIDENT FUND RESPONDENT and CASE NO: 44200/2018 ADV LANGUAGE N.O RAPHULU APPLICANT v ROAD ACCIDENT FUND RESPONDENT and CASE NO: 17258/2015 ADV N RAUBENHEIMER N.O OBO JH BRIAN APPLICANT v ROAD ACCIDENT FUND RESPONDENT and CASE NO: 40258/2021 3 SA SEGOBA OBO NJ SEKWANE AND L SEKWNE APPLICANT v ROAD ACCIDENT FUND RESPONDENT and CASE NO: 35182/2016 WENTZEL, MC APPLICANT v ROAD ACCIDENT FUND RESPONDENT JUDGMENT The Court (KEIGHTLEY & MILLAR JJ and VALLARO AJ): Introduction 1. A well-established feature of the civil trial roll in this Division is the high number of personal injury claims for damages arising out of motor vehicle accidents, or ‘RAF’ claims, and, albeit a smaller number, arising from medical negligence. The damages awarded in these matters can be substantial, often exceeding R1 million or R2 million Rand in RAF cases. The quantum for loss of future earnings is frequently what drives up a typical personal injury damages award, particularly in RAF matters. These damages are awarded on the basis that the amount will compensate the plaintiff for the salary she would have earned but for their injury in an accident. In principle, therefore, the damages award should be available as an ongoing source of financial support for the remainder of the plaintiff’s lifetime. In medical negligence matters, in addition to damages based on loss of future 4 earnings, the care costs associated with incapacitated victims increases the overall award exponentially. 2. In most cases, once a lump-sum award has been made, a court has no further legal interest in the matter. It is open to a plaintiff to spend the entire capital amount awarded as she sees fit. The fact that it is public money that might not be used for its intended purpose may be irksome, but neither the court nor the RAF has any legal basis on which to interfere: a plaintiff is entitled to use her money for whatever purpose she wishes. 3. However, there are certain categories of cases in which the court retains a legal oversight role in ensuring that damages awards are protected. These are cases in which minors are recipients of damages awards, or where an adult plaintiff suffers some incapacity which inhibits her ability properly to manage the financial sum awarded. Many of the latter cases occur where the accident or other act of negligence caused a traumatic brain injury (TBI) to the plaintiff. TBI’s vary in degree and in their neurocognitive effect. Not everyone who has suffered a TBI will require the protection of her damages post-award. One of the functions of the court is to make a determination as to whether such protection is necessary, and if so, what form of protection would be appropriate. 4. It is against this background that the present application arises. In this Division, two legal mechanisms are generally employed to protect funds awarded as damages in cases where the plaintiff has suffered a form of cognitive incapacity as a consequence of the accident or other negligent act. The first is the appointment of a curator bonis following the procedures outlined in rule 57 of the Uniform Rules of Court. The second is the creation of a trust into which the damages award is paid. The formation of the trust is directed in terms of an order of court. 5. Typically, both mechanisms are designed to ensure that the protected funds are used for the benefit of the plaintiff’s maintenance, care and other needs. In both instances, the curator bonis or trustee have fiduciary duties, and they are subject to supervision by the Master of the High Court, and the court itself. The position of 5 curators bonis is governed by the Administration of Estates Act, 66 of 1965 (the Estates Act), and that of trusts and trustees is governed by the Trust Property Control Act, 57 of 1988 (the Trust Act) and the common law.1 Significantly, for purposes of the present application, the scope of the supervisory powers of the Master under the Estates Act differs from that under the Trust Act. 6. It is this latter legislative feature that sparked the Master’s decision to approach the court under section 96(2) of the Estates Act. That section provides: ‘Whenever in the course of his duties the Master finds it necessary to lay any facts before the Court otherwise than upon formal application or motion, he may do so by a report in writing. Provided that the Court may refer any such report back to the Master and direct him to proceed by way of formal application or motion.’ 7. Under the hand of the Deputy Master of the High Court, Ms Moshidi, the Master submitted a report to the Judge President of this Division (the Report) seeking guidance on certain identified issues involving the Master’s supervisory powers over trustees and curators bonis in matters where damages have been awarded by courts. The Master also identified five cases where specific guidance was sought. In view of this, the interests of the parties involved in these five matters were necessarily implicated. They are cited as parties in this application and actively participated in the proceedings. 8. The Judge President issued a directive on 31 August 2021 (the Directive) under s 14(1)(a) of the Superior Courts Act, 10 of 2013 referring the five matters identified in the Report, and the issues raised in the Report to a Full Court for consideration. In addition to the Master and the parties in the identified matters, seven individuals or associations sought admission as amici curiae, which admission was granted. These are the Pretoria Society of Advocates (PSA); Uberrima Phoenix (Pty) Ltd (Uberrima); W F Bouwer (Mr. Bouwer); the South African Medical Malpractice Lawyers’ Association (SAMMLA); the Fiduciary Institute of South Africa (FISA); the Pretoria Attorneys Association (PAA); and Absa Trust Limited (ATL). 9. The Directive requires us to consider and determine certain questions arising from the general issues raised by the Master in the Report. In addition, it requires us to grant appropriate orders in the five identified cases referred, viz. Wentzel v RAF 1 Wilkinson v Crawford & Others 2021 (4) SA 323 (CC) at para 72 6 (Case number: 35182/2016); Van Rooyen N.O. on behalf of Nomvuyiso Ntozakhe v RAF (Case number:28304/2016); Segoba on behalf of Minors v RAF (Case number: 40258/2021); Language N.O. (as Curator ad Litem) Raphulu v RAF (Case number 44200/2018); Raubenheimer N.O. (as Curator ad Litem) James v RAF (Case number 17258/2015). 10. We deal first with the general issues raised by the Master, whereafter, and in light of the findings we make in their regard, we deal with the above identified cases. 11. Before doing so, we note that the Directive was also served on a number of other public bodies, including the Road Accident Fund, the State Attorney, the South African Law Reform Commission, the Legal Practice Council, Gauteng and Legal Aid South Africa. None of these bodies participated in the hearing. No criticism can be levelled at them for so electing, save for the RAF. As the entity entrusted with discharging the legal liability for paying many of the damages awards that are the subject matter of the Master’s concerns, we hoped that they would have appreciated that they had a responsibility to assist the court by making submissions on the issues raised. Some parties made factual averments relating to the s 17(4) undertakings provided by the RAF and the difficulties trustees have had in recovering their administration costs under these provisions. These were issues in respect of which the RAF could and should have provided crucial input. It is concerning indeed that it saw fit to remain disengaged from the proceedings. Issues raised 12. In her report and in her submissions to the court the Master raised two broad areas of concern. The first pertained to what she described as practical difficulties the Master experiences in implementing court orders that are ambiguous in that, while they are aimed at establishing trusts in personal injury matters, they appear to confuse the powers extended to the Master under the Estates Act and those under the Trust Act. It was in respect of this first area of concern that the Master referred the five identified cases to the Court as what she described as test cases which demonstrated the ambiguity in court orders that are sought or have been granted. 13. The second was an overarching concern that the Master expressed as being a developing practice among legal professionals to circumvent, indeed, to evade, the checks and balances afforded the Master under the Estates Act by establishing 7 trusts for the protection of damages awarded to vulnerable plaintiffs rather than proceeding via the curator bonis route. 14. The Master expressed the view that it was the function of her office to protect the interests of minors and others who may be incapable of managing their affairs. In her opinion, this is best done through the appointment of a curator bonis, over whom the Master has more extensive supervisory powers, rather than through the establishment of a trust, in respect of which the Master has less extensive supervisory control. According to her, to continue to permit the untrammeled use of the vehicle of trusts to protect damages awards would have the detrimental effect of diminishing the effective protection of vulnerable victims. 15. In light of the concerns expressed in the report, the Directive identified a list of questions to be determined by this Court. They are the following: ‘(a) Appointment of Trustees and Curators Bonis in RAF/Medical Negligence Matters (i) Does the Administration of Estates Act sanction the creation of a trust and the appointment of a trustee(s) in terms of the Trust Property Control Act for the purpose of administrating funds awarded to minors and persons under curatorship who have been incapacitated as a result of road accidents and/or incapacitated due to medical negligence and if so under what specific instances; (ii) Alternatively, is it legally permissible that a trust be created, and a trustee(s) be appointed in relation to funds awarded to minors and persons who have been incapacitated due to road accidents, medical negligence and other related matters instead of appointing a Curator Bonis in such circumstances? (iii) What is the legal authority, if any, of subjecting trustees appointed in terms of the Trust Property Control Act to the authority of the Master in terms of the Administration of Estates Act, in relation to minors and persons incapacitated due to road accidents, medical negligence and other related matters? (iv) Is the Master competent to appoint a trustee(s) in terms of section 7 of the Trust Property Control Act, in relation to minors and to persons 8 incapacitated as a result of road accidents, medical negligence and other related matters? (v) If so, is the Master authorised to insist that trustees appointed in terms of the Trust Property Control Act, should comply with the provisions of the Administration of Estates Act and if so which provisions? (vi) Would a Court Order to this effect alone be sufficient authority to empower the Master to insist on such compliance? (vii) In the event of a trust being created and trustee(s) appointed, in relation to funds awarded to minors and persons incapacitated through road accidents, medical negligence and other related matters should the drafters of the trust instrument include either express or implied provisions for a trustee's remuneration? (viii) Should the fees and administration costs of a trust be determined on the basis of the directives pertaining to curator's or trustee's remuneration and the furnishing of security in accordance with the provisions of the Administration of Estates Act, as amended from time to time and include but not be limited to disbursements incurred and collection commission calculated at a percentage on the amounts recovered from the Defendant in respect of the section 17(4)(a) undertaking? (ix) Can the monthly premium that is payable in respect of the insurance cover, which is to be taken out by a trustee, serve as security in terms of the trust instrument? (x) Should the Defendant be liable for costs associated with the yearly audit of the trust by a chartered accountant as determined in the trust instrument? (xi) Should the Defendant effectively be liable for all costs pertaining to the administration of the trust? (b) The Guardian's Fund and RAF Matters (i) Should the Guardian's Fund be utilised to administer RAF awards of R500 000 and less in respect of a minor or person incapable of managing his/her own affairs or should such RAF awards be 9 administered through the appointment of a Curator Bonis, tutor, or a trustee? (c) Declarations of Partial Incapability (i) Should a Curator Bonis be appointed in matters where a recommendation is made by a Curator ad litem or medical expert for a person to be declared partially incapable of managing his/her affairs and for the protection of funds awarded by the Court?’ 16. Broadly speaking, the questions identified under paragraphs (a)(i) and (ii) of the Directive fall within the overarching concern of the Master that the establishment of trusts to protect damages awards does not serve the interests of vulnerable plaintiffs. Those identified under paragraphs (a)(iii) to (xi) relate to the Master’s concern regarding ambiguities common in court orders establishing trusts for the protection of damages awards and the practical impediments the Master faces in implementing such orders. The question under paragraph (b)(i) relates to minors specifically. That under paragraph (c)(i), while purporting to deal with ‘partial incapacity’, is linked to both the overarching issue of trust versus curator bonis, as well as to the Master’s practical concerns. 17. We received helpful written and oral submissions from all the parties and the amici curiae. From these it became apparent to us that a rigid determination on each of the questions posed in the Directive would not serve a useful purpose. It was also apparent that all of the parties, and indeed the court, share a common interest in a clear statement of the principles underpinning the legal mechanisms established to protect damages awarded in RAF and medical negligence cases to vulnerable persons, and the procedure in terms of which a court sanctions the use of one or the other of these mechanisms. This judgment is aimed at achieving this objective. To this end, we deal thematically with the issues that became clear during the submissions we heard, rather than dealing with the issues identified in the Directive question by question. We do not ignore the questions raised and will deal with them where appropriate. We also provide guidelines for the adoption of a Consolidated Practice Directive to regulate the procedure legal practitioners should follow in cases in which the court is requested to grant an order establishing a trust to protect damages awards is sought. 10 Structure of the judgment 18. Our judgment is structured as follows: (a) The legal position in respect of curators bonis and trusts under the Estates Act and the Trust Act respectively. (Paragraphs 18 – 30) (b) Can the interests of vulnerable plaintiffs be properly protected via the mechanism of a trust, or is the appointment of a curator bonis necessary? (Paragraphs 31 – 59) (c) Remuneration of trustees and curators and eradicating ambiguities in court orders. (Paragraphs 60 - 89) (d) The powers of the Master in terms of the Administration of Estates Act and the Trust Property Control Act and precedents of prior consent and approval of the Master. (Paragraphs 90 -125) (e) The function of the Guardian’s Fund. (Paragraphs 126 - 133) (f) Summary of Findings on the Judge President’s Directive (Paragraphs 134 – 151) (g) Guidelines for a consolidated Practice Directive. (Paragraphs 152 - 161) (h) The appropriate order in each of the test cases. (Paragraphs 162 – 171) Legal framework Curators bonis 19. The procedure for the appointment of a curator bonis is outlined in Uniform Rule 57. A curator bonis may be appointed either on a declaration by the court that a person is of unsound mind and thus incapable of managing her affairs,2 or on a declaration that she is by reason of some disability, mental or physical, incapable of managing her affairs.3 In either case, the process requires, as a first step, an application to court for the appointment of a curator ad litem. The procedural requirements of such an application are quite stringent. For example, they include the requirement that 2 Rule 57(1) 3 Rule 57(13) 11 the application be supported by at least two medical practitioners attesting to the patient’s disorder or disability and that she is incapable of managing her affairs.4 20. The curator ad litem interviews the patient and makes whatever other inquiries she deems necessary and reports to court on the patient’s mental condition, means and circumstances and other relevant considerations.5 The duty of the curator ad litem is to make these inquires with a view to ensuring that the proprietary and other interests of the patient are adequately protected by the terms of the court order that is sought.6 The curator ad litem may, for example, recommend the appointment of a curator ad personam to the patient’s person, or a curator bonis in respect of her property. The Master must be served with a copy of the report and other documents7 and is required to report to the court on the patient’s means and general circumstances and the suitability or otherwise of appointing a curator to the patient’s person or property. The Master also reports on the suitability of the person identified as a potential curator, and on may make recommendations on, among other things, the powers to be conferred on him or her.8 21. After her appointment, a curator bonis is subject to the supervision of the Master under the Estates Act. Section 71(1) provides that a person appointed as curator bonis by a court may not take care of or administer property without letters of curatorship granted by the Master. The statutory powers of a curator bonis are broadly stated to be the power to perform any particular act as regards the property in question; the power to take care of the property; the power to administer the property, and the power to carry on business associated with the property.9 22. However, a curator bonis may not alienate or mortgage immovable property without authorisation from the court or the Master.10 In addition, any purchase of property shall be void unless it has been consented to or confirmed by the court or the Master.11 4 Rule 57(3)(b) 5 Rule 57(5) 6 Ex parte Campher 1951 (3) SA 248 (C) at 252 7 Rule 57(6) 8 Rule 57(7) 9 Section 76 10 Section 80 11 Section 81 12 23. The Master has further additional supervisory powers over curators. She may apply to court for their removal if they breach their functions and duties12 and authorise payment of curators’ fees.13 Curators are required, within 30 days of their appointment, to lodge with the Master inventories of the property under curatorship.14 Thereafter, they must lodge annual accounts with the Master.15 24. Section 84 deals with the remuneration of curators. It provides that they may receive remuneration from the income of the property under curatorship as provided for in the instrument in terms of which they are appointed, failing which, in terms of the prescribed tariff.16 The remuneration is subject to taxation by the Master. The Master may also reduce or increase a curator’s remuneration if there are special reasons for doing so in a particular case, or she may disallow the remuneration in whole or in part if the curator has failed to discharge her duties or has done so in a dissatisfactory manner.17 Trusts and trustees 25. The rules of South African trust law draw on a mixture of English, Roman-Dutch and distinctively South African rules, but in its nature our trust law is a ‘genuinely South African’ product.18 It has developed largely through our common law, with statutory provisions regulating the administration of trusts. Under the Trust Act, the Master has some supervisory oversight over trustees. This Act reflects the public-law dimension of trusts.19 However, the underlying principle of the Trust Act is that state control of trusts should be limited to a minimum, and where existing procedures and common-law controls function effectively, the Trust Act does not seek to regulate trusts further.20 26. As the Master pointed out in her submissions, a legislative attempt was previously made in chapter III of the Estates Act to subject trusts to tighter bureaucratic control under the Master. Had this chapter been put into effect, it would have placed 12 Section 54 13 Section 84 14 Section 78 15 Section 83 16 Section 84(1) 17 Section 84(2) 18 Cameron et al Honore’s South African Law of Trusts (5 ed) p23-4 (Cameron) 19 Cameron, p180 20 Cameron, p181 13 trustees in a similar position to that of curators bonis. Instead, the South African Law Commission decided, after investigation, to retain the principle of a ‘light rein’ over trusts and trustees, and chapter III was never put into force. Instead, the Trust Act was passed, which retains a lighter rein for the Master over trusts and trustees compared to the powers the Master exercises under the Estates Act.21 27. Nonetheless, like curators bonis, trustees hold office in a fiduciary capacity. The Trust Act obliges trustees to act with the care, diligence and skill which may reasonably be expected of a person who manages the affairs of another.22 They are required to hold trust funds in a separate trust account with a bank.23 Trust property does not form part of the personal estate of the trustee.24 Trustees have various obligations to ensure that trust property is identifiable as such.25 28. Under the Trust Act the Master exercises important supervisory powers over them. Trustees have a duty to lodge the relevant trust instrument in terms of which they are appointed with the Master before the trustee may assume control of the trust property.26 A trustee may only act in that capacity if authorised in writing by the Master,27 and only once security has been furnished to the satisfaction of the Master, or the Master has exempted the trustee from providing security.28 The Master also retains the power to reduce or cancel security; order a trustee to furnish additional security; or order a trustee who has been exempted under the trust instrument from providing security nonetheless to provide security. The Master may appoint a person as trustee if the position falls vacant and may even appoint a co- trustee of her choice if the Master considers this to be necessary. 29. The Master may call on a trustee to account for her administration and disposal of trust property, and may call on the trustee to deliver to the Master any books, records, accounts or other documents relating to the administration or disposal of trust property.29 The Master is aided in the exercise of these powers by the obligation placed on any person who audits the accounts of a trust to report 21 See the discussion in Cameron, p20 22 Section 9 23 Section 10 24 Section 12 25 Section 11 26 Section 4 27 Section 6(1) 28 Section 6(2) 29 Section 16(1) 14 irregularities to the Master.30 The Master may also appoint a fit and proper person to carry out an investigation into a trustee’s administration of trust property.31 If a trustee fails to comply with a request by the Master, or to comply with any duty imposed on the trustee, the Master may apply to court for an order directing compliance.32 The Master may even remove a trustee from office if she fails to perform satisfactorily any duty imposed on her under the Act, or she fails to comply with a lawful request of the Master.33 30. If a trustee’s remuneration is not fixed in the trust instrument, in the event of a dispute, the Master may fix the remuneration.34 31. These provisions of the Trust Act demonstrate that while the Master is perceived as holding ‘light reins’ of bureaucratic control over trusts and trustees, her powers are nonetheless extensive. This is particularly so in circumstances where a trustee fails to comply with her statutory duties, or commits irregularities, or fails to comply with an order or request of the Master. It is important to recognise that the Master is fully empowered under the Trust Act, should circumstances require it, to undertake a range of actions in order to protect the interests of vulnerable trust beneficiaries. In this regard, it is something of a misnomer to describe the Master as having less power than she has in respect of curators bonis. We expand on this point in the section that follows. Can and should courts permit damages awards to be protected via the mechanism of a trust as opposed to the appointment of a curator bonis? 32. This question addresses the overarching concern raised by the Master that legal practitioners were using trusts, rather than the appointment of curators bonis, as mechanisms to protect damages awarded to vulnerable litigants to evade the greater powers of control she exercises in respect of the latter. The question is encapsulated in paragraph (a)(ii) of the Directive, read, to some extent with paragraph (a)(i), although, on closer inspection, the latter question appears to be based on a misunderstanding of the legal situation. 30 Section 15 31 Section 16(2) 32 Section 19 33 Section 20(2)(e) 34 Section 22 15 33. The Master initially raised the question whether it was legally permissible for courts to sanction the establishment of a trust to protect damages awards in RAF and medical negligence cases, where the plaintiff suffers some form of incapacity. Her original line of submission was that it was not permissible or, at the very least, it was undesirable to sanction the establishment of a trust in circumstances where ‘it would be logical to have a curator appointed’. This is because the Master is vested with powers of oversight in respect of the protection of the interests of persons incapable of managing their own affairs. Her concern was, and remains, that because she has less extensive supervisory powers under the Trust Act, the use of trusts to manage damages awarded to incapacitated persons does not serve their best interests. 34. The Master accepts that the office of a trustee is a fiduciary one, and that under the common law and the Trust Act, trustees have fiduciary duties that, to some extent, are subject to the Master’s supervisory control. However, she says that these powers are minimal compared to those under the Estates Act. Furthermore, while she has proactive powers under the Estates Act, her powers under the Trust Act are reactive in nature. To illustrate, the Master points out that unlike curators bonis, trustees are not required to lodge with her an inventory of trust property, nor are they required to account annually to her office. She says that she has no power to appoint a trustee of her own volition, nor to provide input as to the suitability of the trustee appointed under the trust instrument or to make recommendations as to what powers he or she should be granted. As we have indicated, the rule 57 process provides for the Master’s input in this regard before a court appoints a curator bonis. 35. The Master’s point here is that because the establishment of a trust to protect a damages award generally does not trigger the rule 57 process, her role prior to the appointment of the trustee is much reduced. She says that this is a matter of serious public concern because the damages awarded in RAF matters and in medical negligence matters emanate from state coffers and it is vital that she be empowered to exercise effective supervision over the administration and management of the funds. Her view is that this is better achieved through the appointment of a curator bonis, and not the establishment of a trust. In this respect, the Master’s view is based on a misunderstanding of her statutory function. It is to exercise effective supervision over the administration of funds falling within her remit, regardless of the source of those funds. She has no special duty to protect public funds. 16 36. By the time oral argument was advanced at the hearing, the Master had accepted that there was nothing in law to prevent a court from granting an order establishing a trust to protect damages awarded to plaintiffs who suffer some form of incapacity that renders it necessary to place the funds under protection. However, her submission was that the default position ought to be that courts should insist on the appointment of a curator bonis via rule 57 unless the plaintiff consents to the establishment of a trust, or there are other special circumstances justifying the latter route. The Master submitted that it should only be in exceptional cases that courts sanction the establishment of a trust. 37. The issue of consent may be dealt with briefly. In our view, it is a misdirected line of argument. There may be some cases where a vulnerable plaintiff is able to understand and to give proper consent to the establishment of a trust to protect her damages award. However, in cases where the form of incapacity is cognitive (which is the vast majority of cases that arise in this Division), it would be unrealistic to assume that such consent could or would be given. In the Modiba judgment, discussed below, Bertelsmann J expressed the view that in the absence of a declaration of incapacity the consent of the plaintiff is necessary for the creation of a trust to protect an award of damages.35 The view appears to have been obiter, and no authority was cited in its support. Legally, the establishment of a trust does not require the consent of the beneficiary. Some inter vivos trusts may be in the form of a stipulatio alteri, but not all are of that nature. As Cameron points out, trusts that are established by order of court are not bilateral but unilateral acts:36 this suggests that the only consent that would be required in such a case would be the trustee’s consent to be appointed as trustee. For these reasons, in our view, the absence of consent by the beneficiary of the damages award should not be the determining factor in the mechanism of protection directed by the court. Having said this, however, courts must remain vigilant to ensure that, where appropriate, a curator ad litem is appointed for someone with reduced capacity. The curator can then provide the court with her views as to how best to protect the damages award. 35 Modiba obo Ruca v RAF [2014] ZAGPPHC 1071 (27 January 2014) 36 Above, at p138 17 38. Should the court only sanction the establishment of a trust in exceptional cases, as the Master suggests? The Master relies on the Modiba judgment in support of her submission. In that case the court noted: ‘This matter is one of a number of similar cases, all involving road accident victims who suffered significant head and brain injuries, which were heard by the court during the last weeks of the fourth term of 2013. They share most, or all, of the features that will be addressed infra. These features represent a practice that appears to have developed over the past few years which avoids or circumvents the provisions of Rule 57 of the Uniform Rules of Court and the common law relating to individuals who are, or may be, unable to look after their own affairs. By avoiding or circumventing the provisions of the Rule and the common law principles established over decades, these matters are prevented from coming to the Master’s attention, avoiding the latter’s supervision and scrutiny while the potential need to appoint a curator bonis or curator bonis et personae to the individual concerned is not considered properly or at all. This practice may cause irreparable harm to the road accident victims concerned and leaves the door open to other abuses of the Road Accident Fund litigation.’37 39. The court identified several problems associated with the protection of damages awards via the mechanism of a trust as opposed to the appointment of a curator bonis. Many of them were echoed by the Master in her submissions to this court. They include: (a) The absence of input from the Master to the court on whether the establishment of a trust is in the best interests of the plaintiff and on the suitability of a trustee before her appointment;38 (b) The fact that a trust with a financial institution avoids the conditions that accompany the appointment of a curator bonis, with the resultant diminution in the effectiveness of the protection of the funds for the benefit of the plaintiff;39 (c) Trustees are not required to report to the Master annually;40 37 Paras 1-2 38 Modiba, para 40 39 para 40 40 para 40 18 (d) The fees charged by the plaintiff’s legal representatives is not subject to the scrutiny of the Master as they are with a curator bonis;41 (e) The details of investments and fees charged by the trustee and other financial advisors are not disclosed, and no comparison is made with similar charges under a curatorship;42 (f) The absence of details of the plaintiff’s monthly expenses and the income that the trust investments might render for her.43 40. The court in Modiba also highlighted that in some cases, even though the experts had recommended the appointment of a curator, this was not done. The effect was that the plaintiff did not have the capacity to give meaningful instructions to his legal representatives. The judgment notes the necessity to ensure that where necessary a curator ad litem should be appointed under rule 57, and that this should be done as soon as possible.44 41. In our view the court in Modiba correctly identified certain pitfalls that can be associated with the establishment of trusts to protect damages awards. However, this does not mean that trusts ought to be sanctioned only in exceptional cases, as submitted by the Master. 42. It is important to appreciate that in principle curators bonis and trustees hold very similar offices. In Land and Agricultural Bank of South Africa v Parker & Others the Supreme Court of Appeal noted that: ‘The core idea of a trust is the separation of ownership (or control) from enjoyment. Although a trustee can also be a beneficiary, the central notion is that the person entrusted with control exercises it on behalf of and in the interest of another. … It may be said, adopting the historical exposition of Tony Honoré, that the English law of trust, and the trust-like institution of the Roman and Roman-Dutch law, were designed essentially to protect the weak and to safeguard the interests of those who are absent or dead.’45 41 para 40 42 para 41 43 para 41 44 paras 37-9 and 46 45 2005 (2) SA 77 (SCA) at para 19 19 43. These features of the trust and trustees chime closely with those of the curator bonis. Indeed, Cameron, in the later edition of Honore’s text, while noting that the two legal institutions are different, states that in the broadest sense of the word, a curator bonis is a ‘trustee’.46 44. In principle, then, we can see no reason why a court ought not, in any appropriate case, to direct the establishment of a trust to protect an award of damages where such protection is indicated due to the plaintiff’s incapacity. Our view is that the default position ought not necessarily to be the appointment of a curator bonis. 45. What of the misgivings highlighted by the Master and in Modiba about the establishment of trusts as a vehicle to protect damages awards? Some of them rest on the assumption that the trust route, as opposed to the curator bonis route, necessarily excludes the appointment of a curator ad litem under rule 57. This is not so. Where the incapacity of a plaintiff is such that curator ad litem is advisable for protection of the plaintiff’s interests, then this should be done. If the legal representatives overlook the need for curator ad litem, the court should order the process to commence, and the Master’s participation is a given. The important point is that it does not necessarily follow that if curator ad litem recommends the protection of the funds this must be done through the appointment of a curator bonis. The curator ad litem may recommend instead that the plaintiff’s interests will be effectively protected by the establishment of a trust. There is no reason why, if the court is satisfied that the plaintiff’s interests will be protected through the mechanism of a trust, it ought not to be so ordered. 46. The concerns raised by the Master and in Modiba also overlook the fact that the powers of a trustee are effectively established in the trust deed. In the case of court- established trusts, this means that it is the court that directs the extent and limitations of those powers. It is incorrect to assume that a trust established by order of court gives a trustee carte blanche to disregard their fiduciary duties. Unfortunately, the practice of protecting damages awards via the mechanism of a trust has developed incrementally and ad hoc. This has given rise to the problems highlighted by the Master and in Modiba. However, many of these problems can be properly managed and avoided. 46 Cameron, above, p3 20 47. There are also pragmatic reasons why the establishment of trusts as a protective mechanism for damages awards should not be restricted to only exceptional cases. Submissions made by many of the other parties pointed out that the trend towards the establishment of trusts as opposed to the appointment of curators bonis can be attributed to a number of practical difficulties that beset the latter as an option. 48. We were told that the fees for curators bonis are so low that it is difficult to find practitioners who are willing to take on the role. Mr. Kriel, on behalf of the amicus, Uberimma Phoenix, demonstrated in his affidavit how an award of R1 million, on the present Estates Act tariff, provides a curator with approximately R225 per month as remuneration. The curator is expected to pay for her administration costs from this amount. Mr. Kriel submitted that it is virtually impossible to find a curator bonis who will be willing to administer an award that involves an investment amount of less than R3 million. 49. A further limitation referred to by Mr. Kriel is that a curator bonis requires the prior approval of the Master to invest funds. The Master will only approve investments in secure guaranteed instruments, such as fixed deposits. These investments yield relatively low interest rates, and hence income for the beneficiary. Consequently, curators tend to keep funds in income generating investments, as this forms the basis for their remuneration. This is often not in the best interests of the beneficiary. 50. Mr. Kriel stated that in the fiduciary practitioner industry, the professional fees of practitioners appointed as trustees is most often determined on the basis of a percentage per annum of assets under administration, combined with the application of a sliding scale in terms of which the percentage is lowered commensurate with the increased value of assets. On his example of an award of R1 million, a trustee would recoup approximately R833.33 per month. If the costs of administration of the funds was identified as a separate head of damages, then those costs would not be deducted from this fee. 51. What Mr. Kriel’s submissions demonstrate is that the trust as a mechanism of protection can work to the benefit of the vulnerable plaintiff. We should add that many of the other parties echoed very similar sentiments as those expressed by Mr. Kriel. 21 52. It was also submitted that another factor driving the trend towards the establishment of trusts as protective mechanisms was the problem of widespread inefficiencies in the Master’s office caused by an under-capacitation in the staff complement, and problematic communication channels. Mr. Bouwer, who was admitted as an amicus curiae, has been appointed as a trustee in a number of matters, including the David Nkuna matter, highlighted by the Master in the Report as giving rise to ambiguities. Mr Bouwer attested to the following difficulties in the Master’s office: (a) Funds administered by a curator bonis require the prior approval of the Master. (b) The officials in the Master’s office are generally inaccessible. (c) Before an official will assist, the file must be ordered and obtained. Attendance at the Master’s office to apply for a file takes at least three hours. The average time taken to obtain the file is three months. (d) Only thereafter, can a curator proceed to approach the official designated in the file as having responsibility for the matter. An appointment must first be made with that person. However, one cannot do so telephonically because telephones are not answered. E-mails are not responded to or are referred to someone else. Since the Covid pandemic, matters have become much worse. 53. Mr. Bouwer stated that recently curators and other legal practitioners have had to resort to approaching the High Court for orders in the form of a mandamus against the Master before the relevant officials will do what they are ordinarily required to do under the Estates Act. He acknowledged that much depends on the official concerned, and that there are some who respond timeously. Where there is a delay, however, this is prejudicial to the beneficiary, particularly where the Master must pre-approve any expenditure. This includes expenditure on items essential for the care of the patient. Mr. Bouwer’s averments were also echoed by many of the other parties. 54. Most of the parties who made submissions were adamant that the trend towards the application for the establishment of trusts, as opposed to the appointment of curators bonis was not motivated by mala fides or an attempt to circumvent the 22 authority of the Master. The underlying sentiment was that the development was driven by pragmatism. Practitioners accepted that the Master plays an important role in protecting the interests of vulnerable persons in the funds held on their behalf. However, their view was that the micromanagement by the Master which accompanies the appointment of a curator bonis was not necessary and, because of the practical problems in the Master’s office, the office of curator is often not effective in protecting the interests of the beneficiary of the funds. The overwhelming view of the practitioners who made submissions to us was that the Master has sufficient supervisory powers to ensure that trusts were managed in the best interests of the beneficiary. They pointed out that inevitably trustees are required to lodge security which guards against financial loss for the beneficiary arising from any mismanagement of trust funds. 55. The Master denied in general terms that there were problems of efficiency in her office, but she did not respond to the individual averments made by the various parties in this regard. We cannot ignore the difficulties attested to by the practitioners who filed affidavits. It is equally beyond our power to fix them. 56. It seems to us that the Master’s submission that trusts should be sanctioned only in exceptional cases ignores the realities on the ground. In reality, the appointment of a curator bonis will not always inure to the benefit of the vulnerable litigant who is awarded damages requiring protection. Practically, if this court were to agree to the Master’s submission, the effect would be to place an even greater bureaucratic burden on the Master’s office and in all probability cause greater inefficiencies and prejudice to the persons who most require efficient administration of their affairs by others. 57. The Master has extensive powers under the Trust Act to ensure accountability and oversight in respect of trustees. There is no reason why the Master cannot use the existing powers proactively to enable her to meet her statutory obligation to protect the funds held on behalf of vulnerable beneficiaries when these are held in a trust as opposed to under the control of a curator bonis. 58. We conclude therefore that for both principled and pragmatic reasons practitioners representing vulnerable plaintiffs in RAF and medical negligence matters (including curators ad litem where appropriate) should be permitted to apply to court for either 23 the appointment of a curator bonis or for the establishment of a trust to protect the damages awarded. In each case it should be open to the court to determine whether the proposed protective mechanism will properly and effectively manage the award in the plaintiff’s interests. 59. However, we are mindful of the pitfalls that have been highlighted arising from the ad hoc development of the trust route practice. In order to minimise these pitfalls, a court should be placed in a proper position to enable it to make a determination in each case as to whether the proposed protective mechanism is appropriate. This will require practitioners to provide the court with all information relevant to enable the court to make a proper determination as to whether it is proper to sanction the establishment of a trust rather than the appointment of a curator bonis. In addition, a court can, and should ensure that the powers and duties of the trustee are spelled out fully in the order and trust deed. Where appropriate, the court may impose additional obligations on a trustee to ensure that supervision by the Master is effective in terms of the Trust Act. 60. The factors relevant to a court’s determination, and the proposed directive as to the procedure that should be followed in these cases are dealt with later in our judgment. Ambiguity in court orders 61. The Master submitted that one of her overriding difficulties with the establishment of trusts to protect damages awards is that court orders often contain ambiguous terms which are difficult to implement. She included certain examples of ambiguous provisions in her report. They all pertain to orders in which a trustee was appointed rather than a curator bonis. They included the following: (a) ‘The fees and administration costs shall be determined on the basis of the directives pertaining to curator’s remuneration and the furnishing of security in accordance with the Administration of Estates Act 66 of 1965, as amended from time to time and shall include but not be limited to disbursements incurred and collection of commission calculated at 6% on all amounts recovered from the defendant in respect of the Section 17(4)(a) Undertaking.’ (b) ‘The Trustee shall be entitled to the normal fees as prescribed in the regulations to the Administration of Estates Act 66 of 1965, as amended from time to time relating to the fees of a curator bonis appointment’. (c) ‘. . . the powers of the trustees be exercised subject to the approval of the Master of the High Court.’ 24 (d) ‘In terms of this court order a trust is created in terms of the provisions of the Trust Property Control Act 57 of 1988 and this order serves as the trust instrument incorporating the trust provisions as provided for in this order.” And “The trustee shall be entitled to the normal fees prescribed in the regulations to the Administration of Estates Act 66 of 1965 as amended from time to time relating to the fees for a Curator Bonis appointment.’ (e) ‘ . . . the powers of the trustees…are to be exercised subject to the approval of the Master of the High Court.” And “…the defendant pays the costs of the appointment of the trustee(s) as well as the costs of the administration of the estate of the patient by the trustee(s) at each financial year end subject to Section 84 of the Administration of Estates Act, Act 66 of 1965’ (our underlining) 62. The Master’s main concern with provisions like these is that they confuse her powers under the Estates Act with those under the Trust Act. Consequently, she says that she does not know how to exercise her powers, and requires the guidance of the court. 63. There appear to be two categories of ambiguity in the examples cited above. The first, demonstrated in paragraphs (a), (b) and (d), is that the fees of the trustee are set with reference to the Estates Act. The second, as demonstrated in paragraphs (c) and (e) above, is that the orders purport to render the exercise of the powers of the trustees subject to the approval of the Master. Being a creature of statute, the Master cannot exercise powers not accorded by relevant legislation. From our discussion of the Master’s powers under the Trust Act, it is clear that the Master has no general statutory authority to approve the exercise of the powers of a trustee. 64. The Master states correctly that the trustees are appointed in terms of the Trust Property Control Act 57 of 1988 and curators are appointed in terms of the Estates Act. As such, the provisions of section 84 of the Estates Act, dealing with the remuneration of curators and tutors, often invoked in court orders, cannot be made applicable to trustees and nor can trustees be subjected to the authority of the Master in terms of this Act. 65. The context within which these ambiguities arose was that, with the creation of trusts, came the practice of providing that the trustee’s remuneration should be the same as that of a curator bonis and hence the references in court orders to the Estates Act, when dealing with trustees. The obvious reason for doing this was to limit or cap the remuneration of the trustee in the interests of the beneficiary of the trust. Additionally, defendants who are liable for the costs of a curator bonis where 25 the circumstances of the claim necessitate the appointment of one, would ordinarily not object to the creation of a trust provided that the costs thereof did not exceed those of a curator bonis – this practice effectively removed the other party’s financial and effective interest in participating in the determination of the best mechanism for the protection of person concerned. 66. What the parties in these matters, a nd the courts granting the orders have overlooked, is that from a regulatory point of view, one cannot extend to the Master powers over trustees as if the trustees were curators bonis. It appears that the attempt to restrict the trustees’ remuneration has led to court orders which not only conflate two Acts but are in fact contrary to the provisions of the Estates Act. 67. The Master gives the example of the David Nkuna Trust to demonstrate the practical problems her office has faced with orders containing these types of provisions. In that matter, the order establishing the trust provided that ‘the fees and administration costs shall be determined on the basis of the directives pertaining to curator's remuneration … in accordance with the provisions of the Administration of Estates Act.’ The RAF subsequently refused to pay to the trustee expenditure he had incurred for treatment covered by the RAF’s s 17(4) undertaking on the basis that the Master was required under s 22 of the Trust Act to vet and approve these costs. As the Master correctly points out in her report, neither Act empowers her to determine the fees and administration costs of trustees. The Master only has the power under s 22 to consider what the ‘reasonable remuneration’ of a trustee should be if the trust deed is silent on the matter. Furthermore, according to the Master, unlike the situation with curators bonis, where a tariff is provided under the Estates Act, none is provided under the Trust Act. The Master says she does not have the means to determine what would be a ‘reasonable remuneration’ in these matters. 68. As we discuss later, in our view, provisions of the type contained in paragraphs (a), (b) and (d) are not acceptable. They do nothing but sow confusion for the parties and the Master, and do nothing to advance the underlying interests of the plaintiff. However, the answer, in our view, is not to outlaw the establishment of trusts as a protective mechanism for funds awarded to victims of road accidents and medical negligence cases. Instead, where it is clear to the court that it is appropriate to order the establishment of a trust, the court order must make specific provision, based on 26 evidence presented to court, as to the fees and costs payable to the trustee in each case. This should be done without any reference to the Estates Act. 69. As to orders that make the exercise of a trustee’s powers subject to the approval of the Master, they are also not acceptable. A court can direct how a particular statutory power should be exercised by the Master in a particular case, but it cannot extend the Master’s powers beyond that accorded by statute. Thus, it cannot purport to give the Master powers over a trustee akin to those she has in respect of a curator bonis under the Estates Act. 70. In our view, provisions such as those cited in paragraphs (c) and (e) above are invalid because they give the Master powers beyond those provided for in the Trust Act. Parties ought not to seek, nor courts grant such provisions in future cases. Where necessary, in existing cases, affected trustees may approach the court to amend the relevant order so as to provide clarity as to the extent of the Master’s powers over them, in accordance with the Trust Act. Similarly, if necessary, the courts may provide clarity as regards what a trustee is entitled to claim as reimbursements from the RAF by way of expenses incurred by the trustee for medical costs. The RAF cannot insist that these be approved by the Master, and a trustee would be entitled, in a properly motivated application, to recoup these expenses by way of a court order. 71. In summary, then, in order to avoid these types of ambiguity in future: (a) The trustee should be appointed in terms of the Trust Act and in the interests of clarity, the court should desist from making any reference to the Administration of Estates Act, thus obviating the Master’s authority over the trustee in terms of this Act. (b) Section 84(1)(b) of the Administration of Estates Act makes provision for the determination of remuneration of a curator bonis by the Master. This does not apply to trustees, and as such the taxation and approval by the Master of trustee’s fees, disbursements or administration fees and expenditure should not be incorporated in court orders. 27 (c) The Master is not generally empowered in terms of the Trust Act to determine the reasonableness of expenditure on the part of a trustee. Orders should not imply that this is the case, nor may the RAF refuse to reimburse a trustee without the Master’s approval. (d) Critically, as we discuss immediately below, it is imperative that orders establishing trusts should set out in detail how trustees are to be remunerated in terms of their fees and costs. Remuneration and all administration costs must be set out explicitly and comprehensively 72. The remuneration of curators bonis is provided for in Section 84 of the Estates Act which provides that : ‘(1) Every tutor and curator shall, subject to the provisions of subsection (2), be entitled to receive out of the income derived from the property concerned or out of the property itself- (a) Such remuneration as may have been fixed by any will or written instrument by which he has been nominated; or (b) If no such remuneration has been fixed, a remuneration which shall be assessed according to a prescribed tariff and shall be taxed by the Master. (2) The Master may – (a) if there are in any particular case special reasons for doing so, reduce or increase any such remuneration; or (b) if the tutor or curator has failed to discharge his duties or has discharged them in an unsatisfactory manner, disallow any such remuneration, either wholly or in part.’ 28 73. It was argued before us that the remuneration payable to curators bonis was not commensurate with the responsibility and amount of work that had to be done in respect of the majority of estates involving particularly seriously injured or disabled persons. It appears that under s 84(1)(a), a court order appointing a curator bonis may specify the remuneration payable to a particular curator. This does not necessarily mean it should be limited to the prescribed tariff. Thus, if the circumstances of the case are such it is anticipated that a remuneration greater than the statutory remuneration provided for in Section 84(1)(b) is appropriate, the court can consider ordering a higher remuneration. Unfortunately, in none of the matters that are presently before us do any of the curators ad litem deal with this aspect at all in their reports and similarly the Master also fails to deal with this aspect. In our view, the power of the court to direct what remuneration is appropriate for a curator in any case underlines the importance of the need for courts to be placed in possession of all relevant facts so that a proper determination on remuneration can be made. This is a point we reiterate below. 74. In regard to an increase in the remuneration after the curators appointment, neither the Master nor any of the parties placed any information before the Court to indicate whether or not in the case of existing curatorships, any applications have been made in terms of Section 84(2) for the variation and increase in the curator’s remuneration and whether or not such applications have met with approval. In the circumstances, we make no findings in this regard. 75. The Trust Act provides in Section 22 that: ‘A trustee shall in respect of the execution of his official duties be entitled to such remuneration as provided for in the trust instrument or, when no such provision is made, to a reasonable remuneration, which shall in the event of a dispute be fixed by the Master.’ 76. Unlike the position with curators, there is no fall-back statutory tariff that applies to trustees. Nor does the Master have the statutory power to fix the fees of trustees unless no provision for remuneration is made in the trust instrument and a dispute arises as to a reasonable trustee fee. As we noted earlier, this was one of the issues on which the Master sought clarity from the court. 29 77. As noted earlier, with reference to the difficulties experienced by the Master in trying to implement existing court orders, the attempt to subject the remuneration of trustees to the supervision of the Master is not working practically, nor, indeed, is it sanctioned under s 22 of the Trust Act (save for the situation identified immediately above). 78. The solution therefore lies in greater care being taken in deciding on the appointment of either a curator bonis or the establishment of a trust in considering, inter alia, the question of remuneration. In circumstances where a trust is established, the remuneration and administration costs must be dealt with explicitly and comprehensively in the court order and/or trust instrument incorporated into the order of court. If this is done correctly, it will deal with the Master’s complaint that trustees ‘set their own fees’. 79. Ordinarily, the reasonable remuneration of the trustee will vary from trustee to trustee according to the complexity, quality, time and amount of work done in the administration of the trust funds. The court in the matter of Klopper v the Master of the High Court47 noted in this regard that: ‘…time and effort together with the degree of complexity of one’s duties have to be taken into account. It is accordingly clear that the time factor cannot be considered in isolation nor can it be an overriding factor. The other factors must be taken into account as well.’ 80. The method and basis of calculation of the remuneration of the curator (in the event there is an application for an increase or decrease from the prescribed amount, or for an amount of remuneration above the prescribed tariff48) or trustee, and the administration costs, must be set out clearly, unambiguously and comprehensively in the application for the appointment of a curator bonis or the proposed trust deed. The Master recommends that failure to do so should result in the Court refusing to grant the relief sought. We do not agree. However, it is incumbent on the parties to 47 2009 2 All SA paragraph 16 48 Section 84(1)(a) of the Estates Act permits the Court to fix the amount of the remuneration of a curator. It is only in circumstances where no specific provision has been made for the amount of the remuneration that in terms of section 84(1)(b) the prescribed tariff is applicable. 30 place sufficient evidence before the court to enable it to include appropriate provisions in the court order. The remuneration must be commensurate with the complexity, time and effort required to discharge her duties and must perforce include the effort required in the administration of a Section 17(4)(a) Undertaking where the action lies against the RAF. 81. In the matter of AD and Another v MEC for Health and Social Development, Western Cape Provincial Government,49 the parties were ad idem on the creation of a trust for the benefit of a severely disabled child. The court dealt with many issues relating to the creation of trusts. An alarm was raised with respect to the remuneration of the trustee being ‘unchecked’. The court held that ‘the problem can be addressed as has been done here, by specifying the fees in the Trust Deed (an ad valorem charge, not hourly fees).’ The cost of administering the trust was agreed at 1% per annum of capital under administration and 2% of residual capital on termination of the trust. The capital under administration was not to include the value of administering the trust. 82. By way of further example, Absa Trust Limited testified before us that it charges a standard 1% plus VAT management fee of the total amount under administration per annum. This management fee decreases year on year. For the drafting of the documents necessary to create a Trust, ATL charges a once-off amount of R4 900.00. A once-off fee of 0.5% on the amount of the award is charged on th e acceptance of a Trust, and a once-off termination fee percent of 2% of the remaining capital under administration is charged upon the termination of the Trust. These fees are readily determinable and there is little guesswork.’ This is a very convenient formula and the percentages could be altered in accordance with the evidence and specific requirements of each case. 83. Further evidence submitted to us was to the effect that the custom in the fiduciary industry is for trustees to charge 1 to 1,5% of the value of the assets under administration with a sliding scale in which the charge is lowered with increasing value of assets. 84. These examples illustrate that in practice, trustee’s fees can be easily determined and vetted by the court in every case. 49 [2016] ZAWCHC 116 31 85. In RAF matters, the curator bonis or trustee, the RAF Undertakings Department, as well as the Master, appear to have an ongoing problem in terms of current court orders. That the costs of the curator bonis or trustee fall to be recovered in terms of the Undertaking was confirmed in Reyneke N.O. v Mutual and Federal Insurance Company.50 This should be expressly stated in each court order. 86. In matters against the RAF, it may be necessary for the plaintiff to adduce evidence regarding the remuneration of the curator bonis or trustee, particularly in relation to the Undertaking, which will entail evidence as to the expectations regarding complexity, time and expertise required to administer such Undertaking. Much will depend on the facts of each case and the court must be provided with sufficient evidence to endorse a remuneration structure that is appropriate in each case. 87. In Marine and Trade Insurance Company Limited v Katz NO51 the costs of the curator bonis were paid in the amount of R1 152.85, although an Undertaking in terms of Section 21(c) of the Compulsory Motor Vehicle Insurance Act 56 of 197252 had been furnished by the defendant. This upfront lump sum payment of the costs of the trustee, once established, could be a solution to the ongoing problems of remuneration of trustees under the Undertaking. 88. It will be incumbent on the parties to adduce evidence regarding the proposed remuneration and administration fees for which provision must be made. The evidence should cover the particular circumstances of the administration of the estate or trust, as the case may be. The structure of the fees and remuneration permitted must then be delineated clearly in the court order and trust instrument. 89. In regard to out of pocket costs incurred, the curator bonis or trustee is necessarily entitled to incur costs on behalf of the estate or trust, which may include inter alia: (a) Premiums for the security bonds. (b) Rates, taxes, the costs of repair and maintenance of property. 50 1992 (2) SA 417 (T) 51 1979 (4) SA 961 (A) 52 Section 21(c) of the Compulsory Motor Vehicle Insurance Act was amended by the Compulsory Motor Vehicle Insurance Amendment Act 69 of 1978 to introduce the concept of the undertaking to pay in the future by the wrongdoer. 32 (c) Accounting fees in relation to audited financial statements. (d) Costs properly incurred in employing expert assistance, such as financial advisers or medical experts. (e) Resources required to ensure that there is proper care and maintenance of the beneficiary. (f) Travelling costs incurred in attending meetings or conducting trust business53. 90. The remuneration and out of pocket costs, and a basis for their calculation, must be specifically set out in the court order or trust instrument. Once the remuneration provisions have been made subject to the court’s scrutiny and are approved, the ambiguities discussed earlier are overcome. Approval by the court of the remuneration places a necessary safeguard in place which ensures that the fees paid are commensurate with the particular responsibilities and work undertaken and will allay the Master’s concern that the trustees ‘set their own fees’. The annual approval of curators’ accounts and audit of the trusts ensure that no untoward behaviour of either a curator or a trustee remains undetected. The trust instrument must be available for consideration and scrutiny by the court and the defendant. 91. The trust instrument should be considered by the Court. 92. It is equally important that the defendant has a proper opportunity to consider and if necessary, make submissions to the court on the provisions of the trust instrument. The defendant stands to be materially affected by the provisions of the remuneration and administration costs in so far as it incurs a liability to pay such costs. 53 According to Roper & Bryce v Cannock 1954 (1) SA 65 (W), the court held that the travel costs cannot be claimed by a trustee if he is remunerated for holding office. Honoré’s South African Law of Trusts 6th edition states that the preferable view is that trustees should be indemnified for out of pocket expenses but that the trust instrument should make specific provision for the reimbursement of travel expenses. 33 93. The Master, with her consent, may be consulted on the terms of the trust instrument, providing that this does not cause unnecessary delays. In AD and Another v MEC for Health and Social Development Western Cape Provincial Government54 the parties were in agreement that the Master was to be invited to comment on the wording of the Trust Deed. This was also suggested to us by Mr Maleka SC on behalf of the Master. However, we do not consider it practicable for the Master’s comment to be sought as a matter of routine in every case. If the parties or the court consider it appropriate in a particular case, then her comments may be sought. To require this as a matter of course would, in our view, lead to unnecessary delays not only for the parties but also for the court system as a whole. 94. The trust instrument should also expressly state that any amendment to the trust instrument shall be subject to the approval of the High Court which will ensure that any amendments dealing with remuneration of the trustees will be brought to the attention of the Court. 95. Mr Louw SC on behalf of the Pretoria Society of Advocates suggested that court orders which have provisions subjecting the actions and remuneration of trustees to the Master in terms of the Administration of Estates Act ought to be referred back to the High Court to be amended. Each particular matter where a curator bonis has been appointed or a trust established will have to be considered on its own merits. If it is considered necessary to amend any court order or trust deed by the curator bonis or the trustee as the case may be, then they should take such steps as they consider necessary in order to do so in order to have such amendments effected. What is the extent of the Master’s oversight role? 96. One of the problems identified by the respondents and amici with the appointment of curators bonis was that under the terms of their appointment the exercise of their powers is subject to prior approval by the Master. It was submitted that this was one of the reasons why plaintiff’s representatives elect instead for the establishment of a trust as a mechanism to protect damages awards. We were told that all expenditure by curators, even when necessary for the continued well-being of the plaintiff, must await approval. Alternatively, the curator runs the risk that the 54 [2016] ZAWCHC 116 34 Master’s office will refuse to permit a recoupment of expenses that were not pre- approved. 97. Section 72(1)(d) deals with the granting of letters of curatorship by the Master following an appointment by order of court: The powers of a curator bonis are provided for in Section 72(1)(d) of the Estates Act. It provides (in relevant part): ‘The Master shall . . .on the written application of an person …who has been appointed by the Court or a judge to administer the property of any … person … as curator and to take care of his person or, as the case may be, to perform any act in respect of such property or to take care thereof or to administer it … grant letters of … curatorship … to such person’. 98. Section 76 deals with the powers to perform acts in relation to property under curatorship. It provides (in relevant part): ‘(1) The Master may – (a) … (b) By any letters of curatorship granted by him, authorize the curator to do any one or more of the following, namely- (i) To perform any particular act in respect of the property of the person concerned; (ii) To take care of the said property; (iii) To administer the said property; and (iv) To carry on, subject to any law which may be applicable, any business or undertaking of the person concerned. (2) The Master shall, by any such letters granted by him - (a) in any case referred to in paragraph (d) of sub section (1) of section seventy two, confer upon the … curator such powers as will give effect to the terms of the appointment by the Court or the judge; and (b) . . .’ 99. The origin of the problem regarding prior approval appears to be an annexure that the Master routinely attaches to her report to court on the appointment of a curator bonis. The Master’s report routinely makes a recommendation based on a list of 12 separate powers to be bestowed on a curator. The terms of the individual powers are not in issue. What is in issue is that all of these powers, notwithstanding that the Estates Act does not specifically provide for it, are made ‘subject to the prior consent 35 and approval of the Master’. It is this condition and its consequences which it was argued before us militate against the appointment of curators bonis and recommend, in the best interests of the persons concerned, that trust be established. 100. It was argued before us that the imposition of the prior consent and approval condition, which at the request of the Master is a term of every single Order in which a curator bonis is appointed, has as a result rendered the utilisation of the institution of a curator bonis cumbersome, time consuming and, given the particular nature of the needs of the persons who are to be protected, unsuitable. 101. We were provided with examples of reports submitted by the Master to courts on the appointment of curators. A common passage in them reads as follows: ‘I wish to recommend that the Curator Bonis should be clothed with the powers as laid down in Ex Parte Du Toit: In re Curatorship Estate Schwab 1968 1 SA 33 (T) and confirmed in Ex Parte Hulett 1968 4 SA 172 (D). These powers have been summarized in Annexure "A" to this report and I humbly request the Honourable Court to order that the powers 2 to 12 in Annexure "A" be exercised subject to my prior consent and approval as such an order will strengthen my ability to protect the interests of the patient considerably, especially in cases where the Curator Bonis is exempted from furnishing security.’ (our underling) 102. The origin of the restrictive condition which the Master seeks to be imposed in cases where a curator bonis is appointed is not found in either of the abovementioned cases upon which the Master refers to in the reports that she submits to the Court. In neither of the cited cases were the powers conferred upon those curators bonis subject to either prior consent or prior approval. 103. The specific powers with which the Master recommends curators bonis be clothed are: ‘1. to receive, take care of, control and administer all the assets of the Patient; 2. to carry on or discontinue, subject to any law which may be applicable, any trade, business or undertaking of the Patient; 3. to acquire, whether by purchase or otherwise, any property, movable or immovable, for the benefit of the Patient; 4. to let, exchange, partition, alienate and for any lawful purpose, to mortgage or pledge any property belonging to the Patient, or in which the 36 Patient has an interest; 5. to perform any contract relating to the property of the Patient, entered into by him before he was declared incapable of managing his own affairs; 6. to exercise any power, or give any consent required for the exercise of such power, where the power is vested in the Patient for the Patient’s own benefit; or is in the nature of a beneficial interest to him; 7. to raise money by way of mortgage or pledge or any of the movable or immovable property of the patient, for the payment of the Patient’s debts or expenditure incurred or to be incurred for the Patient’s maintenance or otherwise for the Patient’s benefit, or provision for the expenses of the Patient’s future maintenance; or the improvement or maintenance of the Patient’s property; 8. to apply any money for the maintenance, support or towards the benefit of the Patient; 9. to incur expenditure in respect of the improvement of any property of the Patient by means of building or otherwise; 10. to expend any moneys belonging to the Patient on the maintenance, education or advancement of any relative of the Patient, or any other person, wholly or partially dependent on the Patient. To continue such other acts of bounty or charity exercised by the patient as the Master having regard to the circumstances and the value of the estate of the Patient considers proper and reasonable. 11. to invest or re-invest any moneys of the Patient which become available from time to time for investment, and which are not immediately required for the purposes defined in Section 82(c) of the Administration of Estates Act, No. 66 of 1965, (as amended); 12. to institute proceedings which may be necessary in the interest of the Patient, or for the due and proper administration of his estate.’ 104. Section 80 of the Estates Act requires the authorisation of the Master for the alienation or mortgaging of property belonging to a patient where the value of that property exceeds R250 000.00.55 Having regard to the powers set out in paragraph 102 above, it is only the powers referred to in paragraphs 4, 7 and 10 which require the approval of the Master. It follows, particularly in regard to the alienation or mortgaging of immovable property but also in respect of the continuance of any act of bounty or charity on behalf of the Patient, that the consent of the Master must be obtained beforehand. If it were otherwise, the curator bonis would be acting contrary to the provisions of Section 80 and to the empowering Court Order. 55 GN R920 in GG 38238 of 24 November 2014 37 105. Save for these three specific powers, all the other powers are exercised for the benefit of the Patient by the curator bonis in the ordinary course of the administration of the estate and do not require the prior approval or consent of the Master. The Master’s control over the curator bonis’s administration of the estate is exercised in the consideration and approval or not of the annual curatorship account. The security furnished by the curator in terms of Section 77 of the Estates Act, has as its very intention, the protection of and the indemnification of the estate of the Patient against any loss occasioned in consequence of maladministration. The furnishing of security obviates the need for the Master to exercise ‘prior consent and approval’ of every single transaction undertaken by the curator bonis in the discharge of their duty. 106. The removal of this condition in respect of powers 1 to 3, 5 to 6, 8 to 9, and 11 and 12 seems to us to be desirable, there being no prejudice to the estate of the Patient or the Master in its oversight role. In our view, the prior approval condition in respect of these powers ought not to be included in court orders appointing curators bonis as a matter of routine. It is not the function of the Master’s office to micro-manage the exercise of a curator’s powers. Indeed, the Master submitted to us that this is not what she wishes to do. Unfortunately, the practice has created an environment that lends itself to micro-management of curators, resulting in an increase of the bureaucratic burden on the Master’s office. This is not a desirable situation. 107. If there are valid reasons, based on the particular facts of a case, to impose such a condition, a court ought to do so. However, the current practice, in terms of which the Master seeks the inclusion of the condition as a matter of course in each case, must be discontinued. In cases where an existing order is creating difficulties for the curator in performing her functions, there should be no reason why an application could not be made to court for a suitable amendment to the terms of appointment. 108. As far as trusts are concerned, the amici submitted that they provide far more flexibility in that the prior approval condition