A Melamed Finance (Pty) Ltd v VOC Investments Ltd

The respondent’s computer system generated four cheques dated 13 November 2000 in favour of Damelin Textiles. They were intended to be post‑dated, but because the system could not print post‑dated cheques, the dates on each cheque were altered in manuscript to later dates and the alterations were signed by the same authorised signatories who signed the cheques. After the alterations, the cheques were issued to Damelin Textiles, which negotiated three of them to the appellant, A Melamed Finance (Pty) Ltd. One cheque was honoured on presentation, but payment on the other two was stopped by the respondent after it learned that Damelin Textiles had discounted them contrary to an undertaking not to do so. The appellant sued on the two dishonoured cheques, alleging that it was a holder in due course.

The appeal was dismissed with costs.

The case authoritatively confirms South African law on holder‑in‑due‑course requirements by drawing a clear distinction between irregular endorsements and material alterations. It establishes that any apparent material alteration on the face of a bill, including a change of date, deprives a holder of holder‑in‑due‑course protection, regardless of whether the alteration was made before or after issue. The judgment reinforces commercial certainty by insisting that a negotiable instrument must speak for itself without reference to external facts.