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Abstract
Recently, in Harvey v Crawford (2019 (2) SA 153 (SCA)) (Harvey), the Supreme Court of Appeal had to consider whether the adopted grandchildren of a trust donor were beneficiaries in terms of a notarially executed deed of trust. Presently, an adopted child is for all purposes regarded as the child of the adoptive parent, and an adoptive parent is for all purposes regarded as the parent of the adopted child (s 242(3) of the Children’s Act 38 of 2005) (the Children’s Act)). This was also the case in 1953, when the deed of trust in Harvey was executed and when the Children’s Act 31 of 1937 (the 1937 Act) regulated adoption. However, contrary to current legislation, the 1937 Act included a proviso with regard to property that was included in an instrument prior to the date of the adoption order: the instrument was required to display a clear intention that such property would indeed devolve upon an adopted child.Upon interpretation of the deed in question, the court ruled that the adopted children were not entitled to benefit from the capital in the trust. In this regard, the majority opted for a rather restrictive approach, seemingly out of step with recent developments in the interpretation of contracts. The minority decision, on the other hand, came to the opposite conclusion, displaying a more balanced approach to the issue of interpretation. This decision raises some noteworthy issues regarding the interpretation of inter vivos trust deeds with specific reference to adoption. It is submitted that the court erred in its findings; the aim of this case discussion is to analyse the judgment.
Highlights
In Harvey v Crawford (2019 (2) SA 153 (SCA)) (Harvey), the Supreme Court of Appeal had to consider whether the adopted grandchildren of a trust donor were beneficiaries in terms of a notarially executed deed of trust
Both judgments refer to canons of construction at some length, but it is the approach adopted in the minority decision that the authors suggest is the more appropriate and in tune with recent developments in this regard
On the one hand, the principles and rules of contractual interpretation generally apply to trusts inter vivos while, on the other, the rules pertaining to the construction of wills apply to trusts mortis causa (Cameron, De Waal and Solomon Honoré’s South African Law of Trusts (2018) 319)
Summary
The authors suggest that the donor did exactly this when referring to the beneficiaries in the termination clause as “legal descendants”, but Ponnan JA does not acknowledge this term, nor the reason that the trust deed in this clause referred to “legal descendants,” nor the intention conveyed with the use of these words. Molemela JA warns against relying purely on the dictionary definition of words, rather than examining the language used in the document and the facts that provide context (par 23–24) She points out that the narrow interpretation of the wording in the trust deed was contrary to other tools of interpretation, such as context and surrounding circumstances (par 37) and states that the addition of the prefix “legal” to the word “descendants” broadened the class of beneficiaries to include adopted children. Whereas Ponnan JA infers that the donor’s failure to include adopted children in express terms indicated that he had no such intention (par 51), the authors believe that McCaleb is further comparative affirmation that the use of the term “legal descendants” in Harvey clearly broadens the class of beneficiaries to include the adopted appellants or constitutes, as Ponnan JA put it, the use of express terms to include them
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