Gold Coast Ltd. v Caja De Ahorros Del Mediterraneo & Ors [2001] EWHC 504 (Comm) (2 May 2001)

Gold Coast Ltd. v Caja De Ahorros Del Mediterraneo & Ors [2001] EWHC 504 (Comm) (2 May 2001)

On the true construction of the refund guarantees, the Banks were obliged to pay upon production of a certificate from Lloyds Bank, issued in good faith and on reasonable grounds, without awaiting arbitration award. The guarantees are demand guarantees, not 'see to it' guarantees.

Citation
[2001] EWHC 504 (Comm)
Parties
Claimant: Gold Coast Limited; Defendant: Spanish Banks
Jurisdiction
England and Wales
Judgment Date
02 May 2001
Procedural Posture
Commercial Contract Dispute / Summary Judgment Applications
Outcome
Summary judgment granted in favour of the Buyers.
Legal Topics
Refund Guarantees, Demand Guarantees, Shipbuilding Contracts, Performance Bonds, Arbitration Clauses
Contract Law Banking Law Arbitration Refund Guarantees Demand Guarantees Shipbuilding Contracts Performance Bonds Arbitration Clauses

Case Brief

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Parties

Gold Coast Limited

Claimant

Spanish Banks

Defendant

Procedural Posture

Commercial Contract Dispute / Summary Judgment Applications

Legal Issues

  1. 1 Whether the refund guarantees are demand guarantees or 'see to it' guarantees
  2. 2 Whether payment under the refund guarantees is conditional upon arbitration award
  3. 3 Entitlement to payment upon production of Lloyds Bank certificate

Ratio Decidendi

On the true construction of the refund guarantees, the Banks were obliged to pay upon production of a certificate from Lloyds Bank, issued in good faith and on reasonable grounds, without awaiting arbitration award. The guarantees are demand guarantees, not 'see to it' guarantees.

Court Disposition

Summary judgment granted in favour of the Buyers.

Orders

  • Banks to pay Buyers the instalments covered by the refund guarantees upon receipt of Lloyds Bank certificate.
  • Costs of the application and hearing on 21 February 2001 adjourned for argument.