Yuanda (UK) Company Ltd v Multiplex Construction Europe Ltd & Anor

Yuanda (UK) Company Ltd v Multiplex Construction Europe Ltd & Anor

The Guarantee is a performance bond creating secondary liability. A valid call can only be made by Multiplex after an adjudicator's decision in its favour, establishing and ascertaining the sum due under the sub-contract. The Guarantee expires absolutely on 4 April 2020, and any claim must be made before that date. Yuanda was entitled to an interim injunction on 20 January 2020 but is not entitled to continuation of the injunction against the Bank, and continuation against Multiplex is only potentially necessary until the adjudication decision.

Parties
Applicant/claimant: Yuanda (UK) Company Limited; First Respondent/defendant: Multiplex Construction Europe Limited; Second Respondent/defendant: Australia and New Zealand Banking Group Limited
Jurisdiction
England and Wales
Judgment Date
28 February 2020
Procedural Posture
Commercial/construction Injunction Application / Judgment on Continuation/discharge of Interim Injunction
Outcome
Injunction against the Bank discharged; continuation against Multiplex only potentially necessary until adjudication decision; Yuanda not entitled to continuation of injunction beyond that.
Legal Topics
Performance Bonds, Guarantees, Injunctions, Contract Interpretation, Adjudication, Liquidated Damages
Commercial Law Construction Law Banking Law Performance Bonds Guarantees Injunctions Contract Interpretation Adjudication +1 more

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Parties

Yuanda (UK) Company Limited

Applicant/claimant

Multiplex Construction Europe Limited

First Respondent/defendant

Australia and New Zealand Banking Group Limited

Second Respondent/defendant

Procedural Posture

Commercial/construction Injunction Application / Judgment on Continuation/discharge of Interim Injunction

Legal Issues

  1. 1 Whether the Guarantee is a performance bond or on-demand bond
  2. 2 What are the requirements for a valid call under the Guarantee
  3. 3 Whether Yuanda is entitled to continuation of the injunction

Ratio Decidendi

The Guarantee is a performance bond creating secondary liability. A valid call can only be made by Multiplex after an adjudicator's decision in its favour, establishing and ascertaining the sum due under the sub-contract. The Guarantee expires absolutely on 4 April 2020, and any claim must be made before that date. Yuanda was entitled to an interim injunction on 20 January 2020 but is not entitled to continuation of the injunction against the Bank, and continuation against Multiplex is only potentially necessary until the adjudication decision.

Court Disposition

Injunction against the Bank discharged; continuation against Multiplex only potentially necessary until adjudication decision; Yuanda not entitled to continuation of injunction beyond that.

Orders

  • Injunction against the Bank is discharged.
  • Injunction against Multiplex may continue only until adjudication decision or by agreement/undertaking between parties.