Tecnicas Reunidas Saudia for Services and Contracting Co Ltd v The Korea Development Bank

Tecnicas Reunidas Saudia for Services and Contracting Co Ltd v The Korea Development Bank

The HSBC condition in the guarantee is satisfied by payment to SABB due to its association with HSBC, and the guarantee must be interpreted to avoid commercial absurdity. Alternatively, Article 7 of the URDG removes the HSBC condition as it is non-documentary. There is no real prospect of a successful defence, nor any compelling reason for a trial.

Parties
Claimant: Tecnicas Reunidas Saudia For Services and Contracting Co. Ltd.; Defendant: The Korea Development Bank
Jurisdiction
England and Wales
Judgment Date
14 February 2020
Procedural Posture
Commercial / Summary Judgment Application
Outcome
Summary judgment granted for the claimant.
Legal Topics
Demand Guarantees, Contract Interpretation, Summary Judgment, International Rules (urdg)
Banking Commercial Law Construction Law Demand Guarantees Contract Interpretation Summary Judgment International Rules (urdg)

Case Brief

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Parties

Tecnicas Reunidas Saudia For Services and Contracting Co. Ltd.

Claimant

The Korea Development Bank

Defendant

Procedural Posture

Commercial / Summary Judgment Application

Legal Issues

  1. 1 Proper interpretation of the HSBC condition in the demand guarantee
  2. 2 Application of Article 7 of the URDG to remove non-documentary conditions
  3. 3 Doctrine of misnomer in contract interpretation

Ratio Decidendi

The HSBC condition in the guarantee is satisfied by payment to SABB due to its association with HSBC, and the guarantee must be interpreted to avoid commercial absurdity. Alternatively, Article 7 of the URDG removes the HSBC condition as it is non-documentary. There is no real prospect of a successful defence, nor any compelling reason for a trial.

Court Disposition

Summary judgment granted for the claimant.

Orders

  • The Korea Development Bank shall pay the guaranteed amount to Tecnicas Reunidas Saudia For Services and Contracting Co. Ltd.