---

REPUBLIC OF SOUTH AFRICA
THE SUPREME COURT OF APPEAL
AD 122/96
In the case between
RONALD JOSEPH HOFER      First Appellant
GERALD MARK HOFER        Second Appellant
LORENZ GORDON HOFER      Third Appellant
and
JACK KEVITT N O  First Respondent
CHARLES WILLIAM WYKEHAM  Second Respondent
ELEANORA BLANCHE HOFER (Bom Wykeman) Third Respondent
THE MASTER OF THE SUPREME COURT  Fourth Respondent
IDRIS JEREMY MULLER NO   Fifth Respondent
CORAM: VAN HEERDEN DCJ, FH GROSSKOPF, HOWIE, OLIVIER JJA et VAN COLLER AJA
Date of hearing: 29 August 1997
Date of judgment: 26 September 1997
JUDGMENT
VAN COLLER AJA

2 VAN COLLER AJA
The Charles Dickson Trust was established on 13 September 1949.
The founder and donor was Charles Gordon Campbell Dickson and the
beneficiaries were his brother, Herbert Noel Wykeham ("Herbert"), and
Herbert's two children, Charles William Wykeham ("Charles"), the second
respondent, and Eleanora Blanche Hofer, born Wykeham, ("Eleanora"), the
third respondent. Further beneficiaries were the children and grandchildren
of Charles and Eleanora. The three appellants are the children of Eleanora.
The trust property was inherited by the donor from his father and was
subject to a usufruct in favour of his mother. As far as the scheme of
devolution is concerned, the trust deed distinguished between the capital of
the trust and the income derived from it. In terms of the trust deed the
trustees were to pay the whole of the nett income of the trust to the donor

3 after the death of the usufructuary. The trust deed further stipulated that
upon the death of the donor the income of the trust was to devolve upon
Herbert and upon his death it was to devolve in equal shares upon Charles
and Eleanora. Upon their respective deaths the income which devolved
upon each of them was to accrue to their issue per stirpes. On the death
of the last survivor of Herbert's grandchildren the capital of the trust was
to devolve per stripes upon the issue of such grandchildren. The trust deed
also stipulated that if on the death of the last surviving grandchild there
would be no issue surviving, the capital of the trust was to be held by the
trustees in perpetuity and the income was to be applied towards the
furthering of medical research. No provision was made in the trust deed
for the amendment of its terms nor was there any reservation of a unilateral
right of revocation for the donor.

4 The original trust deed was amended on three occasions by means of
notarial deeds. The first amendment took place on 2 July 1973, the second
on 17 January 1986 and the third on 21 February 1989. The effect of the
first amendment was to exclude from the right to capital and income any
of the children of the appellants ( and of Charles' grandchildren). The trust
capital was ultimately to be held in perpetuity and the income utilised for
the furthering of medical research. This income was to be distributed in
consultation with the medical faculty of the University of Cape Town and
the nominee of the South African Medical Council. In terms of the second
amendment only 20% of the income which would have devolved upon the
appellants on Eleanora's death was to be paid to them and 80% of the
income was to be paid to or for the benefit of one or more charitable
institutions in South Africa for the benefit of blind persons. The third

6 and to any children to be born to the appellants. Mr Muller supported the
application and there can be no doubt that the amendments are prejudicial
to the potential beneficiaries represented by him.
On 6 March 1995 a rule nisi was issued calling upon the respondents
or any other interested person to show cause on 23 May 1995 why an order
should not be made declaring the above-mentioned amendments to the
Charles Dickson Trust to be without force and effect. The rule was served
on the respondents and it was also published in two newspapers. There was
no opposition on the return day but Eleanora filed an affidavit to which I
will refer shortly. The Master of the Cape of Good Hope Provincial
Division did not oppose the application but on the question of a variation
of a trust he referred to Honore's South Africa Law of Trusts 4th Edition
by Honore and Cameron at 417. On 6 January 1996 Conradie J dismissed

the application with costs but granted leave to appeal to this Court. The appeal was not opposed by any of the respondents.
independent consideration of the effect of the proposed amendments which
their office as trustees required. The founding affidavit concluded with the
submission that the decisions of the trustees were irregular and should be
set aside.
The origin of the grounds on which the appellants relied is to be
found in the views expressed in a number of articles which appeared in
legal journals shortly after the judgment of this Court in Crookes N.O. and
Another v Watson and Others 1956(1) SA 277 (A). The appellants relied
strongly, both in the Court a quo and in this Court, on the following view
of Honore and Cameron op cit at 417.
Reference was also made to Olivier, Trust Law and Practice at 44-45 where
similar views are expressed.
In the Court a quo Conradie J expressed doubt whether, in view of
dicta in Crookes case, he could accept the submission that the trustee
"committed a breach of his fiduciary duty which meant that the purported
variation of the trust was ineffective." He also had reservations about the
alleged fiduciary duty of a trustee and he doubted that the office occupied
by a trustee could by itself serve as a source of a fiduciary duty to a

10 potential beneficiary. In the event he found that the exercise of an
equitable discretion to protect the interests of non-parties to a deed of trust
is not imported by law into the office of a trustee.
Mr Walther, who appeared on behalf of the appellants in this Court,
contended that the approach on which the appellants rely does not detract
from the basic rule laid down in the Crookes-case. It will be recalled that
according to the judgments of the majority in that case a trust inter vivos
is in effect a contract for the benefit of a third person and unless the
beneficiaries have accepted the benefits stipulated for them it can be varied
by agreement between the founder and the trustee. Mr Walther submitted
that an approach which recognises that an inter vivos trust in South African
law is not purely contractual in nature should be adopted. Support for this
approach is to be found, according to Mr Walther, not only in the minority

judgments of Schreiner JA and Fagan JA in Crookes' case but also in the
judgment of Steyn JA in that case. He referred to what was said by Steyn
JA at 304 F-G and 305 H-306 A. Once it is accepted that a trustee is not
merely a party to a contract with the founder, the trustee, in view of his
fiduciary position, so it was argued, may only agree to a revocation or
amendment of the trust agreement if he considers it to be in the interests of
the beneficiaries or potential beneficiaries. 1 cannot agree with this
argument. Firstly, it must be pointed out that what has to be determined in
this application is not whether the trustees are liable to the beneficiaries for
a breach of an alleged fiduciary duty. What has to be decided is whether
or not the amendments are valid. In Crookes' case two questions had to be
decided. Centlivres CJ formulated the first question at 284 B-D as follows:
12      
This question was answered in the affirmative by both Centlivres CJ and
Van den Heever JA. Although Steyn JA stated in his judgment that a trust
may also have other than contractual incidents it is quite clear from his
judgment that he also answered the aforesaid question in the affirmative.
See Crookes' case at 306 A-C.
In the present case the amendments were made before the benefits
had been accepted by or on behalf of the children of Charles and Eleanora
and consequently they were on the authority of Crookes' case, valid.

During argument Mr Walther, in reply to a question, submitted that the
In order to overcome the hurdle presented by the fact that there had
been no acceptance of the benefits by the appellants and the other more
remote beneficiaries Mr Walther endeavoured to invoke what may be called
"the exception of Perezius." Perezius ad Cod. 8. 55 stated as a general rule
that a donation is recoverable unless accepted by the donee. He added,
however, the important qualification that
The Perezius exception has been received and applies to beneficiaries under
trusts created inter vivos in South Africa. See Honore and Cameron op cit
at 422 n 72, and cases there cited.
It was pointed out, however, by Centlivres CJ in Crookes' case at
288 E-H that the exception only applies if the donated property is to remain

15 in the family of the donor and also is to be inalienable and is to remain
intact. It is clear from the provisions of the trust deed in the present
application that the trustees were empowered to sell the assets and to invest
the proceeds in such manner as they in their sole discretion deemed fit.
There was also no prohibition of alienation to persons outside the family
imposed on the ultimate beneficiaries of the trust capital. Furthermore the
donor, Herbert, Charles and Eleanora were only entitled to the income of
the trust and their acceptance of that benefit cannot be regarded as an
acceptance of the capital which was to go to the ultimate beneficiaries. The
exception of Perezius cannot therefore apply to the present case.
It remains to deal with Mr Walther's alternative argument that the
Court a quo erred in not setting aside the second and third amendments on
the grounds of undue influence. This argument was founded on the

16 allegations contained in the affidavit of Eleanora. She stated that she and
the donor, her uncle, were good friends but when she married in 1963 and
moved to Germany he did not approve and was in fact very unhappy about
it. In 1985 she received a letter from the donor concerning the amendment
of the trust. He wrote that his association with her children had, through
force of circumstances, never been a close one. In view of this he had
become increasingly unhappy at the thought of them receiving the same
proportion of the trust as she would be receiving. Eleanora stated that the
donor continuously put pressure on her late mother to persuade her
(Eleanora) to agree to the amendment. The donor resided with her mother
and he constantly followed her around the house discussing the question of
the amendment of the trust deed and her reluctance to consent thereto. Her
mother repeatedly told her to sign the document to avoid a deterioration of

17 their relationships. In order to avoid a confrontation and further
unpleasantness she eventually signed the required power of attorney. With
regard to the third amendment Eleanora stated that the donor, in the same
manner as before, again placed emotional pressure on her through her
mother to sign the power of attorney. She again signed the document to
put an end to the harassment of her mother and to avoid a confrontation.
In order to have a contract set aside on the grounds of undue
influence it must be proved, infer alia, that the influence complained of
was exercised in an unscrupulous manner in order to induce the innocent
party to consent to the transaction. See Patel v Grobbelaar 1974(1) SA
532 (A) at 534 A-B. In my view it has not been proved that the donor
acted in an unscrupulous manner. I am inclined to agree with the Court a
quo that the situation which arose was not unusual in a family context and

18 that the donor's conduct cannot be described as exertion of oppressive
control over another. The alternative ground of attack on the validity of the
second and third amendment was in my judgment correctly rejected by the
Court a quo.
The appeal is dismissed with costs.
A P VAN COLLER, AJA

OLIVIER, JA
Concur

---