In a recent decision of the Western Cape High Court, the question of when a trustee’s resignation becomes legally effective came under the spotlight. The case of Die Orffer Landgoed (Pty) Ltd v Orffer N.O. and Others [2025] 2 All SA 777 (WCC) offers important guidance for trustees, beneficiaries and anyone dealing with trusts in South Africa.

The facts of the case were relatively straightforward. Die Orffer Landgoed Proprietary Limited (“the applicant”) conducted farming operations on Bloubank Farm, which was registered in the name of the Bloubank Boerdery Trust (“the Trust”). Over time, the applicant advanced loans to the Trust, which by the end of 2022 had exceeded R17 million. To secure repayment, in December 2022 the Trust resolved to grant the applicant a Special Power of Attorney (“SPA”), allowing the applicant to sell the farm and apply the proceeds towards settling the debt. The trustee resolution authorising the SPA to be granted was signed by two of the three trustees. The third trustee, Mr Stofberg, had resigned by written notice in June 2019.

Although the farm was sold in May 2024, the property transfer was delayed due to the misplacement of the original SPA. The Trust challenged the SPA’s validity, claiming that Mr Stofberg’s resignation was not effective and that all three trustees were required to authorise the resolution.

The key legal issue was when, in terms of the Trust Property Control Act 57 of 1988 (as amended) (“the Act”), a trustee’s resignation becomes effective. Section 21 of the Act permits a trustee to resign by written notice to the Master of the High Court (“the Master”) and the beneficiaries, but it does not specify when that resignation takes effect.

The Court considered two opposing views: one that the resignation of a trustee is effective once the resignation has been sent to the Master and there has been acknowledgement of receipt by the Master’s office, and another that a trustee remains in office until a replacement is appointed and/or new letters of authority have been issued. In the current case, the Court found that Mr Stofberg’s resignation was effective once the Master acknowledged receipt of the resignation letter in March 2021.

As a result, the two remaining trustees had the legal authority to act without Mr Stofberg’s involvement post March 2021. Accordingly, the SPA, signed in December 2022, was found to be valid and the Trust’s attempt to set the SPA aside was dismissed.

This decision provides welcome certainty in an area of trust law that has been unsettled. It confirms that, unless the trust deed provides otherwise, a trustee’s resignation is effective once the Master has formally acknowledged such resignation.