Bank guarantee - The bank guarantee format does not provide for a trigger point for its encashment - Furnishing
the bank guarantee without stipulating the situations in which the guarantee shall become encashable, will be meaningless. (2016)3 P.L.R.SC 752
Bank Guarantee - Injunction against honouring Letter of Credit by a
Bank - The Court must be slow in granting an order of injunction restraining the realisation of a bank guarantee or Letter of Credit - There are two exceptions to the above rule - The first
is that it must be clearly shown that a fraud of a grievous nature has been committed and to the notice of the Bank - The second is that injustice of the kind which would make it impossible
for the guarantor to reimburse himself, or would result in irretrievable harm or injustice to one of the parties concerned, should have resulted - It is not enough to allege fraud but there
must be clear evidence both as to the fact of fraud as well as to the bank's knowledge of such fraud. (S.C.)(180) P.L.R.
Bank Guarantee - Was unconditional - Fact that the petitioner was directed to deposit the
amount of bank guarantee in its cash credit account shows that the bank did not have the requisite money or security, for which the bank guarantees had been issued - That is why, the
petitioner was required to deposit the amount - Such are not the conditions in the bank guarantees - The bank guarantee is an instrument, which entitles a person in whose favour it is issued
to receive the amount immediately the same is invoked - It is not that it is conditional on deposit of the amount by the person who furnishes the bank guarantee. (182) P.L.R.
Guarantee - Once cash credit limit was extended and new documents were executed - The guarantors stood discharged and they are not bound by for the subsequent Act which is
without their consent - Contract Act, 1872 (9 of 1872) S. 133. (175) PLR
Guarantors - No reason why the Joint Memo, which states compromise arrived at between the Bank and the principal debtors, would not bind the
guarantor when under the Clause she has admitted that any judgment or award obtained by the Bank against the principal debtor would bind the parties Bank Loan. (2016)3 PLRSC 542