Race-based charitable bequests

The Supreme Court of Appeal recently handed down judgment in a matter concerning a deceased woman’s wish to set up bursaries to be available to white students only (amongst other criteria).

The other criteria specified the universities at which the students should be studying, their field of study, and the level at which they should be studying. The bursaries would help them further their studies overseas, on condition that they returned to South Africa to put their new skills into practice.

The trustees tasked with putting the deceased’s wishes into effect, approached the universities which the deceased had identified. They all indicated that they could not accept any bursary unless it was open to students of all races. The trustees then approached first the High Court and later the Supreme Court of Appeal, asking the courts to remove the race criterion from the deceased’s bequest, on the basis that it was discriminatory and therefore against public policy.

Both courts refused to remove the race criterion.

The High Court suggested (without making a finding) that the deceased’s intention was not necessarily unfairly discriminatory, as it appeared to be directed at limiting the “brain drain” in the identified field of expertise. The court found that it could only vary the provision in the deceased’s will if it had consequences which she had not foreseen – that is, if the discriminatory nature of the bequest meant that it could not be carried out and her will thus failed to dispose of her estate. The evidence in the specific case was clear that the deceased had foreseen that her wishes might not be given effect to, and she had indicated certain charities which should in that event receive the funds that would have been used for the bursaries. There was no need to tinker with the deceased’s will as it could still be put into effect, albeit on an alternative basis. If the universities would not accept the bursaries, then the charities would benefit in their place.

In upholding the High Court’s ruling, the Supreme Court of Appeal pointed out that this case differed from another similar case decided in the intervening period, in which the racial criterion had indeed been removed by the court. In the other case, there had been no alternative to cater for the possibility that the racial bequest would not be carried out. In order to avoid a situation whereby the deceased’s wishes were completely frustrated, in the other case the racial criterion had been removed. In this case, on the other hand, the deceased had set up an alternative which she had clearly intended to follow in the event that her racial bequest failed. The court found that it was possible in this case to give effect to the deceased’s intentions without amending her will, and so this was what should be done. The deceased had, in general, the freedom to frame her will and dispose of her assets as she wished. It was not for the trustees or the court to decide that it would be preferable to amend her will to make the bursaries acceptable to the universities, instead of simply applying the alternative provision she had put in place.

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