Yuanda (UK) Company Ltd v Multiplex Construction Europe Ltd & Anor [2020] EWHC 468 (TCC) (28 February 2020)

Yuanda (UK) Company Ltd v Multiplex Construction Europe Ltd & Anor [2020] EWHC 468 (TCC) (28 February 2020)

The Guarantee is a performance bond, not an on-demand bond. Multiplex is not entitled to make a valid demand under the Guarantee unless damages are established and ascertained under the contract, taking into account all sums due or to become due to Yuanda. The demand made on 17 January 2020 was premature, as the ascertainment process had not concluded. The Guarantee expires on 4 April 2020. Yuanda is not entitled to continuation of the injunction; the interim injunction is discharged.

Citation
[2020] EWHC 468 (TCC)
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
Injunction Proceedings (technology and Construction Court) / Judgment on Continuation/discharge of Interim Injunction
Outcome
Interim injunction discharged; Yuanda not entitled to continuation.
Legal Topics
Performance Bonds, Guarantees, Injunctions, Contract Interpretation, Adjudication, Fraud Allegations
Construction Law Commercial 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

Injunction Proceedings (technology and Construction Court) / Judgment on Continuation/discharge of Interim Injunction

Legal Issues

  1. 1 Type of instrument: performance bond or on-demand bond
  2. 2 Requirements for valid call under the Guarantee
  3. 3 Entitlement to interim and continued injunction

Ratio Decidendi

The Guarantee is a performance bond, not an on-demand bond. Multiplex is not entitled to make a valid demand under the Guarantee unless damages are established and ascertained under the contract, taking into account all sums due or to become due to Yuanda. The demand made on 17 January 2020 was premature, as the ascertainment process had not concluded. The Guarantee expires on 4 April 2020. Yuanda is not entitled to continuation of the injunction; the interim injunction is discharged.

Court Disposition

Interim injunction discharged; Yuanda not entitled to continuation.

Orders

  • Interim injunction restraining payment under the Guarantee is discharged.
  • Bank and Multiplex may proceed in accordance with the Guarantee's terms.