Guardrisk Insurance Company Ltd and Others v Kentz (Pty) Ltd (94/2013)
Guardrisk Insurance Company Ltd and Others v Kentz (Pty) Ltd (94/2013) [2013] ZASCA 182; [2014] 1 All SA 307 (SCA) (14 November 2013)
The Supreme Court of Appeal held that the guarantees issued by Guardrisk were unconditional 'on demand' guarantees, not conditional payment guarantees. The terms of the guarantees created an absolute and independent obligation on Guardrisk to pay Kentz upon valid written demand, regardless of disputes between Kentz and Brokrew under the construction contract. The only exception to payment is proof of fraud by the beneficiary. The appellants failed to establish fraud, as Kentz acted in good faith and believed it was entitled to payment under the guarantees. The court rejected arguments that un…
Source excerpt
- Performance Guarantee
- Fraud Exception
- Construction Contracts
- Letters Of Credit
- Independent Bank Guarantee