Prevance Bonds (Pty) Ltd v Voltex (Pty) Ltd and Others

First Strut (RF) Ltd applied for credit facilities from Voltex (Pty) Ltd in January 1999 and, as security, ceded its book debts to Voltex. Due to an administrative mistake, the written credit application and security cession reflected the incorrect registration number of Voltex, namely that of a related company which had previously changed its name. After First Strut was liquidated in 2013, Voltex proved its claims as secured, relying on the cession. Prevance Bonds (Pty) Ltd, a competing creditor, objected to Voltex’s status as a secured creditor. The Master upheld the objection. Voltex then applied to the High Court for rectification of the written document to reflect its correct registration number. The High Court granted rectification. Prevance appealed to the Supreme Court of Appeal, contending that rectification was not competent after concursus creditorum and that Voltex failed to establish the requirements for rectification.

The appeal was dismissed with costs, and the High Court’s order rectifying the security cession was confirmed.

The case clarifies South African law on the interaction between rectification and insolvency. It confirms that rectification of a document after concursus creditorum is permissible where it merely corrects a misdescription and does not alter substantive rights. The judgment reinforces the distinction between correcting a written instrument and creating new rights, providing important guidance for secured transactions and insolvency practice.