“I’m a trustee on the family trust of a deceased friend where I’ve helped look after the family assets in the trust for his children. Part of the trust property is a beach property that the children want sold and that has been on the market for quite a while. I’ve been toying with the idea of buying the property myself and I’m sure the children wouldn’t mind, but am hesitant to do so because of my position as trustee. Can I consider buying the property from the trust or would that be wrong?”Because of the unique nature of a trust and also the fiduciary responsibility that a trustee holds in respect of the trust property and trust beneficiaries, buying property from a trust, should rightfully be approached with caution where you are also a trustee of the trust. To determine a trustee’s right to benefit from a trust in which he holds the position of trustee, one must carefully look at the fiduciary duties of a trustee. In the first instance, section 9(1) of the Trust Property Control Act 57 of 1988 states that trustees must, in the performance of their duties and in exercising their powers, act with the care, diligence and skill which can reasonably be expected of a person who manages the affairs of another. Secondly, trustees must act in good faith, implying that trustees must always act in the best interests of the beneficiaries.Accordingly, buying property from a trust could result in a trustee being accused of acting with self-interest and deriving a benefit that is detrimental to the beneficiaries of the trust or of mismanagement of the trust.To safeguard yourself against such accusations, a trustee may undertake the following steps in mitigation:
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