CITIBANK N.A. v. DAYARAM NANIK AND ANOTHER

CITIBANK N.A. v. DAYARAM NANIK AND ANOTHER

On the contemporaneous documents and the wording of the continuing guarantees the court found no arguable defence: the guarantees, by their express language and by the defendants' acknowledgements of subsequent supplemental facility letters, extended to advances under the 2001 facility letter and subsequent facility...

Source-derived case information.

Citation
CITIBANK N.A. v. DAYARAM NANIK AND ANOTHER
Parties
Plaintiff: Citibank N.A.; 1st Defendant: Dayaram Nanik; 2nd Defendant: Days Impex Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
3 June 2013
Case Number
HCA2145/2011
Procedural Posture
Civil Action Guarantees/banking Facilities / Appeal From Master's Decision on Summary Judgment and Grant of Unconditional Leave to Defend; Decision on Appeal by Deputy High Court Judge Le Pichon
Outcome
Appeal allowed; Master's order granting unconditional leave to defend set aside; court held both defendants liable under the Citibank guarantees which extend to advances under the 2001 and subsequent facility letters; certain quantum items accepted and others disregarded pending certificate/documentation.
Legal Topics
Continuing Guarantee, Construction of Guarantee, Conclusive Evidence Clause, Summary Judgment, Liability, Quantum
Source Language
en
Contract Guarantee Banking Law Civil Procedure Continuing Guarantee Construction of Guarantee Conclusive Evidence Clause Summary Judgment +2 more

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Summary, issues, holding and outcome

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Parties

Citibank N.A.

Plaintiff

Dayaram Nanik

1st Defendant

Days Impex Limited

2nd Defendant

Procedural Posture

Civil Action Guarantees/banking Facilities / Appeal From Master's Decision on Summary Judgment and Grant of Unconditional Leave to Defend; Decision on Appeal by Deputy High Court Judge Le Pichon

Legal Issues

  1. 1 Whether the continuing Citibank guarantees extended to advances under the 2001 facility letter and subsequent facility letters (1st, 2nd and 3rd)
  2. 2 Whether there were triable issues on liability
  3. 3 Whether there were triable issues on quantum including the SLGS loan balance, overdraft and application of the conclusive evidence clause

Ratio Decidendi

On the contemporaneous documents and the wording of the continuing guarantees the court found no arguable defence: the guarantees, by their express language and by the defendants' acknowledgements of subsequent supplemental facility letters, extended to advances under the 2001 facility letter and subsequent facility letters; therefore both defendants are liable. On quantum the SLGS outstanding of HK$9.2m was correctly calculated; two US dollar items were substantiated and the overdraft figure was not substantiated in the affirmation and thus must be disregarded absent a proper certificate under clause 16.

Court Disposition

Appeal allowed; Master's order granting unconditional leave to defend set aside; court held both defendants liable under the Citibank guarantees which extend to advances under the 2001 and subsequent facility letters; certain quantum items accepted and others disregarded pending certificate/documentation.

Orders

  • Master de Sousa's order granting unconditional leave to defend is set aside
  • Both defendants are held liable under the Citibank guarantees for advances made under the 2001 facility letter and subsequent facility letters (1st, 2nd and 3rd)