Caterpillar Financial Services Ltd v Goldcrest Plant & Groundworks Ltd & Ors

Caterpillar Financial Services Ltd v Goldcrest Plant & Groundworks Ltd & Ors

The Court of Appeal held that extrinsic evidence was admissible and established, objectively, that the guarantee was intended to cover all six novated agreements. The judge below erred in excluding relevant evidence and in finding uncertainty. Judgment was entered for Caterpillar against the second and third defendants.

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)
Outcome
Appeal allowed
Legal Topics
Guarantees, Novation, Extrinsic Evidence, Interpretation of Contracts
Contract Law Guarantees Novation Extrinsic Evidence Interpretation of 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)

Legal Issues

  1. 1 Whether extrinsic evidence is admissible to identify the subject matter of a guarantee
  2. 2 Whether the guarantee covers all six novated agreements or is unenforceable for uncertainty

Ratio Decidendi

The Court of Appeal held that extrinsic evidence was admissible and established, objectively, that the guarantee was intended to cover all six novated agreements. The judge below erred in excluding relevant evidence and in finding uncertainty. Judgment was entered for Caterpillar 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