D - Debt or damages
6/10/23
KHAN v SINGH-SALL [2023] EWCA Civ 1119
A claim on a guarantee, by which the guarantor undertakes to make good and pay on demand to a bank any default in payment by a company of its liabilities, is a claim in debt not for damages [30]. Such a claim is a claim for a liquidated sum even if the claim is disputed so that it cannot be known until trial whether the claim is a good one or not.
5/12/12
DUNBAR ASSETS PLC v FOWLER [2013] BPIR 46, (Ch)
The effect of a guarantee which provided for payment of the principal debtor’s liability on demand was that the guarantor agreed to pay the principal’s debt. This gave rise to a conditional payment obligation which was a liability in debt, not damages, following McGuinness v Norwich & Peterborough BS (2011). It could therefore found a statutory demand. Although the guarantee also included an indemnity against loss suffered by the creditor from the principal’s failure to pay, that was a separate and cumulative obligation. Offers made by the guarantor to secure or compound had not been unreasonably refused. The creditor had not been obliged to realise other security before pursuing the guarantor. Delay in serving a bankruptcy petition after the statutory demand had not prejudiced the guarantor. A bankruptcy order was therefore made on the creditor’s petition.