Bank guarantees are contractual undertakings generally arranged by banks in order to pay, or to repay a certain sum in case of some default in performance by the principal debtor of a contract with the creditor so as to facilitate the fine flow of trade and commerce in internal and international trade. The purpose of a bank guarantee is to secure all obligations of the contractor under a contract in such a way that it ensures that the owner is compensated in case of non performance without the need of prior legal actions. In lieu of cash deposits it has become a worldwide common practice to accept bank guarantee. The bank guarantees are preferred to other categories of guarantees due to the financial credibility enjoyed by the banking companies in the relevant market, as well as due to easiness to capitalize them. This paper would analyze the different types of bank guarantee, i.e., conditional and unconditional bank guarantee and would also highlight the differences between general guarantee as defined under Section 126 of the Indian Contract Act, 1872 and a bank guarantee. It would also delve into the discussion about the conditions under which the courts would grant injunctions restraining a bank from enforcing a bank guarantee. Alongside, this paper would also bring to light the significant difference between the Indian law and the common law in relation to the way they deal with injunction of bank guarantee. CONDITIONAL AND UNCONDITIONAL GUARANTEES Bank guarantees can be of two types: conditional and unconditional performance guarantees. Under a conditional guarantee, the surety happens to be liable when the party claiming the guarantee proves the breach of terms of the underlying contract or proves the breach of the te... ... middle of paper ... ...d. Therefore, the bank may ask the beneficiary to approach the court for injunction. K.G White, Bankers Guarantees and the Problem of Unfair Calling in JOURNAL OF MARITIME LAW AND COMMERCE 124 (1980). supra note 6. Banerjee And Banerjee v. Hindusthan Steel Works Consm Ltd., AIR 1986 Cal 374. Basic Tele Services Ltd. v. Union of India, AIR 2000 Del 1. Uttar Pradesh State Sugar Corporation v. Sumac International Ltd., AIR 1997 SC 1644. Uttar Pradesh Co-op Federation Ltd v Singh Consultants and Engineers Pvt. Ltd, (1988) 1 SCC 174. Id. NA (1984 [1] AER 351 at 352). (1984) 1 All ER 351, (1984) 1 WLR 392 Itek Corporation v. The First National Bank of Boston etc. (566 Fed Supp. 1210) 17. Id. Potton Homes v. Coleman Contractors 1984 28 Build LR 19. UP Co-operative Federation Ltd v. Singh Consultants and Engineers Ltd. 1988 AIR 2239.
Equuscorp Pty Ltd v Haxton; Equuscorp Pty Ltd v Bassat; Equuscorp Pty Ltd v Cunningham's Warehouse Sales Pty Ltd (2012) 246 CLR 498
In this case entitled Gulash v. Stylarama there was a contract entered regarding the construction of pools. The pool was built and constructed but after a period of time the pool began to tilt, in which that’s when Gulash decided to sue Stylarama. The suit was that Stylarama violated provisions of article 2 of the UCC (Uniform Commercial Code). Due to the fact the cost of the materials and the labor were not written out in detail but instead of in a lump sum it would make it hard to come up with a sum for the exact cost of the damages. Furthermore, since this is a contract with a mix of goods and services, article 2 of the Uniform Commercial Code would not apply the services only to the goods but the common law would to the services. And
Australian Legal Information Institution, Garcia v National Australia Bank Ltd [1998] HCA 48; 6 CCL 81; 194 CLR 395; 155 ALR 614; 72 ALJR 1243 (6 August 1998) Austlii .
The banking system in Panama makes use of the advanced modern technologies. In Panama City, there are approximately 100 internationally renowned banks. The presence of strict regulations regarding the banking sector by the government has seen the banking sector grow tremendously (Arboleda & Martín 152). For instance, the Panamanian government has come up with strict banking rules and guidelines, to scrutinize all the banking practices so that the banks can give good banking services to all people. To ensure this occurs, the government has ordered the submission of monthly auditing reports from all the banks to the National bank of Panama and to the Panama’s National Banking Commission. All the depositors in any bank need sureties of their securities,
Mooney, Richard. "Banker of America." The Boston Globe 4 Apr. 1999: L1 "Powerful house of Morgan Changes with the Times." The San Diego Union-Tribune 24 Feb. 1986: 18 Sinclair, Andrew. Corsair: The Life of J. Pierpont Morgan. Toronto: Little, Brown and Company, 1981.
R v Secretary of State for Transport, ex parte Factortame Ltd and others [1999] All ER (D) 1173.
SEC.2005. “Complaint: SEC v. L. Dennis Kozlowski, Mark H. Swartz, and Mark A. Belnick”. 2/16/2005.
...‘Consideration: Practical benefit and the Emperor’s new clothes’ in Beatson and Friedmann (eds). Good Faith and Fault in Contract Law (Oxford University Press, 1995);
Banking supervision regards two major points which are safety and soundness. This has to do with consumer protection laws, safety and soundness of a bank often gets measured by an examiner. The examiner has to perform an examination review on banks performances which is based off the banks management, financial condition, and its commands with regulations. This helps protect consumer’s rights towards consumer’s protection laws, also helps ensure consumers they are safe with their banks.
The first scenario is that Bo Broker Company will accept a non-interest bearing or unsecured negotiable note that is payable over the life of the related
...el such as: purpose of the loan, maturity of the security pledged, the history of the client with the company and the unique characteristics that the bank’s customers might have.
...er and the banker had faced a lot of crisis when they decided to make the bet, endure the consequences on both sides for making the bet and make the final resolution or solution.
This paper provides the details about the Current law and FMCB deal with peer-to-peer lending. Here current law describes about the Securities which are offered globally.
This system helps all of these banks provide financial secrecy which is that only you and your banker would legally be allowed to know the financial activity within your account. The financial secrecy, completely different from financial privacy, includes many regulations to maintain this asset of secrecy. For example, many banks would n...
A variety of groups are concerned in bank profitability for various reasons. The bank shareholders would want to know if the value of their investments is high or low. The investors also use current and past performance to predict future price of the banks’ shares traded on the stock exchanged. The management of the bank as trustee of the shareholders is evaluated and compensated on the basis of how well their decisions and planning have contributed to growth in assets and profits of their banks. Employees of bank also are concerned with profits, since their salaries and promotions are frequently tied to the profitability performance of their banks. Depositors use bank performance and profitability as indicators of security for their deposits in the banks. Finally, business community and general public are concerned about their banks’ performance to the extent that their economic prosperity is linked to the success or failure of their banks.