Meritz Fire & Marine Insurance Co Ltd v Jan De Nul NV & Anor [2011] EWCA Civ 827 (21 July 2011)

Meritz Fire & Marine Insurance Co Ltd v Jan De Nul NV & Anor [2011] EWCA Civ 827 (21 July 2011)

The APGs in question were demand guarantees governed by the ICC Uniform Rules, requiring payment against documents and not dependent on the underlying contract's continued existence or the identity of the builder. The transfer of the shipbuilding contracts and dissolution of HWS did not discharge the guarantees. As the Buyers presented the required documents and statements, Meritz was obliged to pay under the APGs.

Citation
[2011] EWCA Civ 827
Parties
Appellant/claimant: Meritz Fire & Marine Insurance Co Ltd; Respondent/defendant: Jan De Nul N. V.; Respondent/defendant: Codralux SA
Jurisdiction
England and Wales
Judgment Date
21 July 2011
Procedural Posture
Appeal (civil) / Court of Appeal Judgment
Outcome
Appeal dismissed
Legal Topics
Advance Payment Guarantees, Demand Guarantees, Novation, Performance Bonds, Construction of Guarantees, Conflict of Laws
Commercial Law Insurance Law Contract Law Advance Payment Guarantees Demand Guarantees Novation Performance Bonds Construction of Guarantees +1 more

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Parties

Meritz Fire & Marine Insurance Co Ltd

Appellant/claimant

Jan De Nul N. V.

Respondent/defendant

Codralux SA

Respondent/defendant

Procedural Posture

Appeal (civil) / Court of Appeal Judgment

Legal Issues

  1. 1 Whether the advance payment guarantees (APGs) issued by Meritz remained enforceable after the shipbuilding contracts were transferred to successor companies and the original builder was dissolved
  2. 2 Whether the APGs were discharged by novation of the underlying contract
  3. 3 Whether the APGs are payable on documents alone or require proof of underlying liability

Ratio Decidendi

The APGs in question were demand guarantees governed by the ICC Uniform Rules, requiring payment against documents and not dependent on the underlying contract's continued existence or the identity of the builder. The transfer of the shipbuilding contracts and dissolution of HWS did not discharge the guarantees. As the Buyers presented the required documents and statements, Meritz was obliged to pay under the APGs.

Court Disposition

Appeal dismissed

Orders

  • Meritz Fire & Marine Insurance Co Ltd is required to pay under the advance payment guarantees upon presentation of the required documents by the Buyers.