Allied Distributive Merchants Ltd. v. Kavanagh [2002] IESC 40 (10 May 2002)

Allied Distributive Merchants Ltd. v. Kavanagh [2002] IESC 40 (10 May 2002)

Continued trading with a customer in breach of terms is an indulgence, not an alteration of the agreement. Mere forbearance or nonfeasance by the creditor does not discharge the surety. No material alteration occurred requiring the surety's consent or a sealed document.

Citation
[2002] IESC 40
Parties
Respondent: ADM Limited; Appellant: Appellants (unnamed, including Brian Kavanagh)
Jurisdiction
Ireland
Judgment Date
10 May 2002
Procedural Posture
Summary Judgment Application / Appeal From High Court to Supreme Court
Outcome
Appeal dismissed
Legal Topics
Surety Discharge, Material Alteration, Forbearance to Sue
Contract Law Guarantee Law Surety Discharge Material Alteration Forbearance to Sue

Case Brief

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Parties

ADM Limited

Respondent

Appellants (unnamed, including Brian Kavanagh)

Appellant

Procedural Posture

Summary Judgment Application / Appeal From High Court to Supreme Court

Legal Issues

  1. 1 Whether material alterations in the contract between principal and creditor without the surety's consent discharge the surety
  2. 2 Whether the creditor's continued trading with the principal after default constitutes a material alteration discharging the surety

Ratio Decidendi

Continued trading with a customer in breach of terms is an indulgence, not an alteration of the agreement. Mere forbearance or nonfeasance by the creditor does not discharge the surety. No material alteration occurred requiring the surety's consent or a sealed document.

Court Disposition

Appeal dismissed

Orders

  • Judgment for respondent for €268,085.28 plus costs