RENAULT SAS v LIBERTY ENGINEERING GROUP PTE. LTD. [2023] SGHC(I) 8 (19 May 2023)

RENAULT SAS v LIBERTY ENGINEERING GROUP PTE. LTD. [2023] SGHC(I) 8 (19 May 2023)

Clause 2.1(b) of the Guarantee, properly construed, only obliges LEG to pay amounts that are due and payable by the Purchaser under the FSA. The occurrence of a Bankruptcy Event does not accelerate the repayment schedule or create an immediate liability for LEG to pay the full €7m. As at the date of demand, no amount was due from the Purchaser, so no amount was due from LEG. The Guarantee does not provide for acceleration upon a Bankruptcy Event except in the event of default in repayment.

Citation
[2023] SGHC(I) 8
Parties
Plaintiff: Renault SAS; Defendant: Liberty Engineering Group Pte Ltd
Jurisdiction
Singapore
Judgment Date
19 May 2023
Procedural Posture
Commercial Suit / Final Judgment
Outcome
claim dismissed
Legal Topics
Contractual Interpretation, Guarantees and Indemnities, Rules of Construction
Contract Law Credit and Security Contractual Interpretation Guarantees and Indemnities Rules of Construction

Case Brief

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Parties

Renault SAS

Plaintiff

Liberty Engineering Group Pte Ltd

Defendant

Procedural Posture

Commercial Suit / Final Judgment

Legal Issues

  1. 1 Whether the occurrence of a Bankruptcy Event under the Guarantee triggered immediate liability of the guarantor (LEG) to pay €7m to Renault
  2. 2 Proper construction of clause 2.1(b) of the Guarantee regarding the obligations of the guarantor upon a Bankruptcy Event

Ratio Decidendi

Clause 2.1(b) of the Guarantee, properly construed, only obliges LEG to pay amounts that are due and payable by the Purchaser under the FSA. The occurrence of a Bankruptcy Event does not accelerate the repayment schedule or create an immediate liability for LEG to pay the full €7m. As at the date of demand, no amount was due from the Purchaser, so no amount was due from LEG. The Guarantee does not provide for acceleration upon a Bankruptcy Event except in the event of default in repayment.

Court Disposition

claim dismissed

Orders

  • Renault's claim is dismissed.
  • Renault is to pay LEG's costs of the proceedings, amount to be agreed or determined by written submissions if not agreed.