Waydale Ltd v DHL Holdings (UK) Ltd (No2) [2000] ScotCS 291 (20 November 2000)

Waydale Ltd v DHL Holdings (UK) Ltd (No2) [2000] ScotCS 291 (20 November 2000)

The guarantee, construed in its transactional context and as a whole, was not limited to the original landlord (SDA) but was intended to secure the tenant's obligations under the lease for the benefit of whoever was landlord during its subsistence. The language of the primary obligation did not expressly confine the benefit to the SDA, and the ancillary provisions were insufficiently clear to cut down the scope of the primary obligation. Therefore, Waydale Limited, as successor landlord, is entitled to enforce the guarantee.

Citation
[2000] ScotCS 291
Parties
Pursuer: Waydale Limited; Defender: DHL Holdings (UK) Limited
Jurisdiction
Scotland
Judgment Date
20 November 2000
Procedural Posture
Commercial Action (outer House, Court of Session) / Interlocutory Judgment on Preliminary Issue (construction of Guarantee and Title to Sue)
Outcome
Declarator granted in favour of pursuers; proof before answer allowed on remaining conclusions.
Legal Topics
Guarantee Interpretation, Assignability of Guarantees, Landlord and Tenant Obligations, Cautionary Obligations, Title to Sue
Contract Law Property Law Commercial Law Guarantee Interpretation Assignability of Guarantees Landlord and Tenant Obligations Cautionary Obligations Title to Sue

Case Brief

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Parties

Waydale Limited

Pursuer

DHL Holdings (UK) Limited

Defender

Procedural Posture

Commercial Action (outer House, Court of Session) / Interlocutory Judgment on Preliminary Issue (construction of Guarantee and Title to Sue)

Legal Issues

  1. 1 Whether the guarantee executed by DHL Holdings (UK) Limited in favour of the Scottish Development Agency is enforceable by Waydale Limited as successor landlord
  2. 2 Whether the guarantee is limited to the original creditor (SDA) or extends to successors
  3. 3 Whether the guarantee is assignable without the guarantor's consent

Ratio Decidendi

The guarantee, construed in its transactional context and as a whole, was not limited to the original landlord (SDA) but was intended to secure the tenant's obligations under the lease for the benefit of whoever was landlord during its subsistence. The language of the primary obligation did not expressly confine the benefit to the SDA, and the ancillary provisions were insufficiently clear to cut down the scope of the primary obligation. Therefore, Waydale Limited, as successor landlord, is entitled to enforce the guarantee.

Court Disposition

Declarator granted in favour of pursuers; proof before answer allowed on remaining conclusions.

Orders

  • Repel defenders' fourth plea-in-law
  • Sustain pursuers' second plea-in-law