A Melamed Finance (Pty) Ltd v Voc Investments Ltd (364/05) [2006] ZASCA 148; 2008 (6) SA 506 (SCA) (31 May 2006)

A Melamed Finance (Pty) Ltd v Voc Investments Ltd (364/05) [2006] ZASCA 148; 2008 (6) SA 506 (SCA) (31 May 2006)

The Supreme Court of Appeal held that a cheque with a material alteration apparent on its face, such as a change in the date, is not regular and complete for the purposes of section 27(1) of the Bills of Exchange Act. The alteration, whether made before or after issue, is material because it changes the business effect of the instrument and the earliest date for presentment. The regularity of a bill must be assessed solely on its face, without reference to its history or the circumstances of its issue. The appellant, having taken cheques with patent alterations to the dates, could not qualify as a holder in due course. The court further held that the order dismissing the action for...

Citation
[2006] ZASCA 148
Parties
Appellant: A Melamed Finance (Pty) Ltd; Respondent: VOC Investments Ltd
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
31 May 2006
Case Number
364/05
Procedural Posture
Civil Appeal / Appeal From Refusal of Provisional Sentence
Outcome
Appeal dismissed with costs.
Judges
Scott, Zulman, Brand, Conradie, Cloete
Legal Topics
Bills of Exchange Act, Holder in Due Course, Material Alteration, Cheque Irregularity
Banking and Finance Commercial and Corporate Bills of Exchange Act Holder in Due Course Material Alteration Cheque Irregularity

Case Brief

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Parties

A Melamed Finance (Pty) Ltd

Appellant

VOC Investments Ltd

Respondent

Procedural Posture

Civil Appeal / Appeal From Refusal of Provisional Sentence

Legal Issues

  1. 1 Can the holder of a cheque with a material alteration apparent on its face qualify as a holder in due course?
  2. 2 Does a change in the date of a cheque, made before or after issue, affect its regularity and the rights of the holder?
  3. 3 Is an order dismissing an action for provisional sentence appealable when no leave to enter the principal case is granted?

Ratio Decidendi

The Supreme Court of Appeal held that a cheque with a material alteration apparent on its face, such as a change in the date, is not regular and complete for the purposes of section 27(1) of the Bills of Exchange Act. The alteration, whether made before or after issue, is material because it changes the business effect of the instrument and the earliest date for presentment. The regularity of a bill must be assessed solely on its face, without reference to its history or the circumstances of its issue. The appellant, having taken cheques with patent alterations to the dates, could not qualify as a holder in due course. The court further held that the order dismissing the action for...

Court Disposition

Appeal dismissed with costs.

Orders

  • The appeal is dismissed with costs.