Podcast Location:
Download it here [file size: 18.7 MB]
Categories:
Corporate & Commercial Law
Litigation & Dispute Resolution
CPD Points:
Up to 1 point. details »

Due to the difference in guidelines between the SRA and the Bar Standards Board, CPD points are awarded differently for Solicitors, Barristers and Legal Executives:

Regulated by the Solicitors Regulation Authority:
Listen and pass the quiz: Gain 1 CPD point (60 minutes)
Listen only, gain ½ a CPD point (30 minutes)

Regulated by the Bar Standards Board:
Listen and pass the quiz: Gain 1 accredited CPD point (60 minutes)

Regulated by ILEX:
Listen and pass the quiz: Gain 1 CPD point (60 minutes)
Listen only, gain ½ a CPD point (30 minutes)

Cost:
  • FREE
Length:
30 minutes of audio
(+ optional 5 minute online quiz)
Plays on Computer:
Yes Downloadable as MP3:    Yes
Contributor(s):
Course Aims:

This podcast aims to familiarise the listener with the current issues when litigating on the validity of a contract of guarantee. It seeks to establish the differences between a true contract of guarantee and a so called ‘letter of comfort’. The second half of the podcast concerns the complex topic of surety’s rights to set off. Listeners will be reminded of the different quality of rights enjoyed in an insolvency and non-insolvency situation.

Outcomes:
After completing the course you will:
  • Understand the key matters that make contracts of guarantee distinct from other contracts;
  • Understand the difference between a contract of guarantee and a letter of comfort;
  • Know the circumstances by which a guarantor will have a right of set off and counterclaim against the principal debtor;
  • Be aware of the complexities that arise in having a debt guaranteed by multiple sureties;
  • Be familiar with the consequences of an insolvency situation for a surety, particularly with regard to rights of set off against a debtor.
Level:
Intermediate Difficulty: 3 of 5
Classification:
Case Update
Legal Principles
Sources and References:
  • Statute of Frauds 1677;
  • Kleinwort Benson Ltd v Malaysia Mining Corporation Berhad [1989] 1 WLR 379;
  • Associated British Ports v Ferryways NV & Anor [2009] EWCA Civ 189;
  • Holme v Brunskill (1878) 3 Q.B.D. 495;
  • Brook v Green [2006] EWHC 349 (Ch);
  • Trade Indemnity Co Ltd v Workington Harbour and Dock Board [1937] AC 1. 2;
  • Triodos Bank NV v Dobbs [2005] EWCA Civ 630;
  • J Steyn, “Guarantees: the Co-extensiveness Principle” (1974) 90 The Law Quarterly Review;
  • Cellulose Products Pty Ltd v Truda (1970) 92 WN (NSW);
  • Hyundai Shipbuilding and Heavy Industries Co. Ltd v Pournaras [1978] 2 Lloyd's Rep, 502;
  • Berchavais v Lewis;
  • Re Fenton [1931] 1 Ch. 85;
  • Secretary of State for Trade and Industry v Frid; sub nom. Re West End Networks Ltd (In Liquidation) [2004] UKHL 24;
  • s.167 Employment Rights Act 1996;
  • Day & Dent Constructions Pty Ltd v North. Australian Properties Pty Ltd (1981) 34 ALR 595.

In this podcast, barrister Richard Perkoff outlines the principle issues that arise when litigating a contract of guarantee. It will address the features of a contract of guarantee and how to distinguish it from a 'letter of comfort'. The podcast also addresses in detail the complex question of a surety's right of set off or counterclaim against the debtor both in an insolvency and non-insolvency situation.

Podcast added: 13/10/09

Podcast last reviewed: 2011-03-28

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