Trustee's Duties

Section 73

Trustee may obtain legal assistance


(1) Subject to the provisions of this section and section 53 (4), the trustee of an insolvent estate may with the prior written authorization of the creditors engage the services of any attorney or counsel to perform the legal work specified in the authorization on behalf of the estate: Provided that the trustee—

(a)    if he or she is unable to obtain the prior written authorization of the creditors due to the urgency of the matter or the number of creditors involved, may with the prior written authorization of the Master engage the services of any attorney or counsel to perform the legal work specified in the authorization on behalf of the estate; or
(b)    if it is not likely that there will be any surplus after the distribution of the estate, may at any time before the submission of his or her accounts obtain written authorization from the creditors for any legal work performed by any attorney or counsel,

and all costs incurred by the trustee, including any costs awarded against the estate in legal proceedings instituted on behalf of or against the estate, in so far as such costs result from any steps taken by the trustee under this subsection, shall be included in the cost of the sequestration of the estate.


(2) Subject to the provisions of subsection (3), costs incurred under this section, except costs awarded against the estate in legal proceedings, shall not be subject to taxation by the taxing master of the court if the trustee has entered into any written agreement in terms of which the fees of any attorney or counsel will be determined in accordance with a specific tariff: Provided that no contingency fees agreement referred to in section 2 (1) of the Contingency Fees Act, 1997 (Act No. 66 of 1997), shall be entered into without the express prior written authorization of the creditors.


(3) If—

(a)    the trustee has not entered into an agreement under subsection (2); or
(b)    there is any dispute as to the fees payable in terms of such an agreement,

the costs shall be taxed by the taxing master of the High Court having jurisdiction or, where the costs are not subject to taxation by the said taxing master, such costs shall be assessed by the law society or bar council concerned or, where the counsel concerned is not a member of any bar council, by the body or person designated under section 5 (1) of the Contingency Fees Act, 1997.


(4) No bill of costs based upon an agreement entered into under subsection (2) shall be accepted as cost of the sequestration of the estate, unless such bill is accompanied by a declaration under oath or affirmation by the trustee stating—

(a)    that he or she had been duly authorized by either the creditors or the Master, as the case may be, to enter into such an agreement;
(b)    that any legal work specified in such bill has been performed to the best of his or her knowledge and belief;
(c)    that any disbursements specified in such bill have been made to the best of his or her knowledge and belief; and
(d)    that, to the best of his or her knowledge and belief, the attorney or counsel concerned has not overreached him or her.


(5) Notwithstanding anything to the contrary contained in this Act, the Master may disallow any costs incurred under this section if the Master is of the opinion that any such costs are incorrect or improper or that the trustee acted in bad faith, negligently or unreasonably in incurring any such costs.

[S. 73 amended by s. 20 of Act No. 16 of 1943, by s. 24 of Act No. 99 of 1965 and by s. 1 of Act No. 78 of 1980 and substituted by s. 1 of Act No. 34 of 1998.]