Sam Chapanduka v Trustees for the Time Being of Royale Housing Project

The respondent Trust issued summons seeking release of certain gate valves and fire hydrants (66 x 75mm gate valves, 9 x 75mm fire hydrants and 2 x 160mm gate valves) from the appellant, which he had received on behalf of the Trust for delivery to Mutare. Alternatively, the Trust sought damages of US$7,174.00. The appellant pleaded that the Trust only had two trustees (himself and his wife) and that one trustee could not suspend another. He denied receiving the items on behalf of the Trust, stating he received them as the Trust's lawful agent. The lower court found there was a contract/agreement for the appellant to deliver goods on behalf of the Trust. The court accepted Trust board minutes from 22 January 2020 showing the appellant had been suspended from the Trust for abuse of his position as trustee, and that Cleopas Murahwa had been appointed as replacement trustee and authorized to represent the Trust in litigation. The court ordered the appellant to release the gate valves he had acknowledged receiving at the pre-trial conference.

• Whether a trustee who had been suspended had locus standi to challenge proceedings brought by the Trust
• Whether the remaining/replacement trustees had locus standi to bring proceedings on behalf of the Trust without consent of the suspended trustee
• Whether the resolution authorizing representation of the Trust in litigation was valid
• Whether the appellant was liable to deliver goods received on behalf of the Trust
• Whether specific performance could be ordered in absence of proof of a valid contract
• Whether costs should be awarded against the appellant

The appeal was dismissed with costs.

A person who is de facto administering a trust as trustee has locus standi in any matter relating to the trust. A trustee who has been validly suspended from office for abuse of his position and breach of fiduciary duties loses his status as trustee and cannot challenge proceedings brought by the remaining or replacement trustees on behalf of the trust. Valid grounds for suspension/removal of a trustee include abuse of trust property and finances, acts tantamount to abuse of power, and acting contrary to trust interests. Where a trustee has been validly suspended and a replacement trustee appointed, the replacement trustee has proper authority to represent the trust in legal proceedings. Board minutes need not be verbatim records of meetings; it is sufficient that resolutions are captured in the minutes.

The court observed that the appeal was an attempt to circumvent the delivery of goods as ordered by the lower court and an attempt at remaining as a trustee even when the record showed he was properly removed for legitimate reasons of not acting in the interests of the trust, having been invited to that position initially by his wife. The court also noted principles from Mashoko v Mashoko/Chikosi Family Trust regarding commonly accepted grounds for removal of a trustee, including where a trustee transfers trust funds from safe investment to personal account, deliberately refrains from advising co-trustees of decisions, or treats trust property as his own. The court emphasized that trustees must exercise their powers with care, diligence and skill reasonably expected of a person managing the affairs of another.

This case clarifies important principles in Zimbabwean trust law regarding: (1) the locus standi of trustees to bring proceedings on behalf of a trust; (2) the circumstances under which a trustee may be validly suspended or removed from office for breach of fiduciary duties; (3) that a suspended trustee loses standing to challenge trust proceedings; (4) the validity of trust resolutions and that board minutes need not be verbatim records provided the essential resolutions are captured; and (5) the fiduciary duties of trustees to act in the interests of the trust and the consequences of breaching those duties. The case reinforces that trustees who abuse trust property, transfer trust funds to personal accounts, or act contrary to trust interests may be properly removed from office.