Die totstandkoming van 'n concursus creditorum in insolvensie en die rektifikasie van 'n ooreenkoms: Nedbank Ltd v Chance Brothers 2008 4 SA 209 (D)

Abstract

The establishment of a concursus creditorum in insolvency and the rectification of an agreement: Nedbank Ltd v Chance Brothers 2008 4 SA 209 (D) The issue discussed in this article deals with the legal position in the case where, prior to sequestration or liquidation, an insolvent and another party enter into an agreement in terms of which the other party becomes a creditor of the insolvent estate. Of particular importance is the situation where, after sequestration or liquidation, the other party realises that the written agreement does not correctly reflect the terms initially agreed upon by the parties and consequently applies for the rectification of the agreement. The effect of such rectification order will place the party concerned in a stronger position in relation to the other creditors. In Nedbank Ltd v Chance Brothers the court refused such an application. The court held that the rectification of the agreement would cause Nedbank to be entitled to a much larger amount than the amount specified in the written agreement. The core question is whether a court order to rectify an agreement would result in the creation of new rights or whether it is simply an acknowledgement of existing rights. There is a clear difference between these two situations. The application is one for the rectification of an agreement. The continued validity of the agreement during sequestration or liquidation will in any event depend on the provisions of the law of insolvency. The exact rights of the creditor at the time of liquidation should be fully investigated. In the case under discussion the debtor was at all relevant times in debt to the creditor. The common intention of the parties was that this right to payment was preferential. Admittedly, after rectification of the agreement the creditor would have been in a more preferential position owing to the terms of the original agreement. If the original agreement is, however, unreasonable and unfair, it should be brought into question. This can be done by way of impeachable transactions under the insolvency law.