Buy Legal
ing immovable prop side
erty (like a house) of
in the na it
me of a trust
Obtain authority before signing an offer to purchase
By Chamonie Buys (Senior Associate at Tomlinson, Mnguni and James Attorneys)
In our administration of Trusts we experience too often that a trustee enters into a property transaction
without the required authority to do so. In an unreported case handed down in the North Gauteng High
Court on 20 May 2013, Jansen et al v Ringwood Investments 87 cc et al (Case No.: 59711/2012) the presiding
judge, Khumalo AJ, again confirmed the process which must be followed when immovable property is
purchased in the name of a Trust.
Trustees and trust administrators should take note and strictly adhere to the following process:
1. The authority to purchase the immovable property in the name of the Trust must be recorded in writing
by the trustees;
2. The written authority/resolution may authorise one of the trustees to sign the offer to purchase on behalf
of all of the trustees;
3. The written authority/resolution must exist at the time of signing the offer to purchase.
Verbal authority by your co-trustees amounts to no authority and the signing by one trustee of
an offer to purchase cannot be ratified by his co-trustees after the offer to purchase has
been signed. The offer to purchase is invalid if a trustee signs without having the
authority to do so.
Consult your co-trustees before signing an offer to purchase and request your
trust administrator to prepare the resolution to authorise the purchase
of the property and to also authorise one trustee to sign the
offer to purchase and the transfer documents on behalf of
the Trustees and Trust.
Tomlinson, Mnguni and James Attorneys
www.tmj.co.za

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