ROW_NUMBER() is not available in MS SQL 2000.
So this is the alternative solution
I assumed that if there is single refnumber then that has to be marked as 1 ( i.e. RecentDate)
DECLARE @example TABLE(refnumber VARCHAR(20), dateadded date, cancelled BIT)
INSERT INTO @example
SELECT '48394A0021', '2002-01-01', 0 union all -- Single refnumber
SELECT '54739A0040', '2002-01-01', 0 union all -- Single refnumber
SELECT '54739A0150', '2002-01-01', 0 union all
SELECT '54739A0150', '2004-01-01', 1 -- marked as 1 b'coz latest record for refnumber '54739A0150'
UPDATE @example SET
cancelled = 1
FROM @example e
JOIN (SELECT refnumber, MAX(dateadded) RecentDate
GROUP BY refnumber
ON e.refnumber= t.refnumber AND e.dateadded= t.RecentDate