Interesting Judgment: Prevance Bonds v Voltex & Others
31 March 2023
Members,
Please find attached a judgment handed down by the SCA this morning.
Two issues had to be dealt with by the SCA:
- The first issue was the legal issue of whether rectification of a document reflecting a security cession can take place after the advent of the concursus creditorum. [Previous decisions of the high court in Nedbank Ltd v Chance & Others (followed by the court in The Standard Bank of South Africa Ltd v Strydom N.O. & Others) refused rectification of a contract on the basis that rectification post concursus would always inevitably prejudice the rights of other creditors.]
- The second issue was a factual issue of whether Voltex as the applicant in the court a quo had adduced sufficient evidence to factually sustain a case for rectification.
The SCA held that the insolvency of First Strut and the establishment of a concursus creditorum provided no impediment to the rectification of the security cession of Voltex. The SCA found that a valid cession agreement was concluded between Voltex and First Strut prior to the granting of a liquidation order, but the cession document did not reflect the parties’ common intention in the sense that the creditor (Voltex) was not correctly described. Rectification of the cession document did not affect the rights of other creditors.
Kindly sent to us by Jan Reitz of Reitz Attorneys.
Take care
René Bekker
Chief Operating Officer
Prevance Bonds v Voltex & Others. SCA case no. 58/2022