Caterpillar Financial Services Ltd v Goldcrest Plant & Groundworks Ltd & Ors [2007] EWCA Civ 272 (16 March 2007)

Caterpillar Financial Services Ltd v Goldcrest Plant & Groundworks Ltd & Ors [2007] EWCA Civ 272 (16 March 2007)

The guarantee, construed in the context of the discussions, correspondence, and the commercial circumstances, was intended to cover all six novated agreements. The extrinsic evidence was admissible and established an objectively clear consensus as to the subject matter. The guarantee was therefore enforceable against the second and third defendants.

Citation
[2007] EWCA Civ 272
Parties
Claimant/appellant: Caterpillar Financial Services Limited; Defendant/respondent: Goldcrest Plant and Groundworks Limited; Defendant/respondent: Jaspal Singh Khaira; Defendant/respondent: Paramjit Khaira
Jurisdiction
England and Wales
Judgment Date
16 March 2007
Procedural Posture
Civil Appeal / Appeal From High Court (queen's Bench Division, Mercantile Court) to Court of Appeal
Outcome
Appeal allowed
Legal Topics
Guarantees, Novation, Interpretation of Contracts, Admissibility of Extrinsic Evidence, Uncertainty in Contracts
Contract Law Commercial Law Guarantees Novation Interpretation of Contracts Admissibility of Extrinsic Evidence Uncertainty in Contracts

Case Brief

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Parties

Caterpillar Financial Services Limited

Claimant/appellant

Goldcrest Plant and Groundworks Limited

Defendant/respondent

Jaspal Singh Khaira

Defendant/respondent

Paramjit Khaira

Defendant/respondent

Procedural Posture

Civil Appeal / Appeal From High Court (queen's Bench Division, Mercantile Court) to Court of Appeal

Legal Issues

  1. 1 Whether the guarantee signed by the second and third defendants covered all six novated agreements or was void for uncertainty
  2. 2 Whether extrinsic evidence was admissible to identify the subject matter of the guarantee

Ratio Decidendi

The guarantee, construed in the context of the discussions, correspondence, and the commercial circumstances, was intended to cover all six novated agreements. The extrinsic evidence was admissible and established an objectively clear consensus as to the subject matter. The guarantee was therefore enforceable against the second and third defendants.

Court Disposition

Appeal allowed

Orders

  • Judgment for Caterpillar against the second and third defendants
  • 2nd and 3rd respondents to pay appellant's costs, assessed at £12,000 including VAT within 14 days