Source: All England Reporter
Publisher Citation: [2012] All ER (D) 200 (May)
Neutral Citation: [2012] EWCA Civ 698
Court: Court of Appeal, Civil Division
Judge:

Laws, Rimer and Patten LJJ
Representation John McGhee QC and Paul Clarke (instructed by Birketts LLP) for the claimant.
  Raymond Cox QC (instructed by T G Jones & Associates, Swansea) for QRL and S.
  The third defendant did not appear and was not represented.
Judgment Dates: 24 May 2012

Catchwords

Guarantee - Construction - Licence to underlease containing rent payment guarantees - First and second defendant guarantors guaranteeing rent liabilities of the third defendant tenant - Claimant being obliged to give guarantors notice if rent arrears exceeding two months - Tenant failing to pay rent and claimant enforcing guarantees - Guarantors disputing liability and counter-claiming - Guarantors arguing claimant failing to comply with obligation to notify of arrears - Guarantors claiming duty on claimant being condition precedent - Claimant submitting claimant's breach of obligation to notify extinguishing liability under guarantees - Judge finding no condition precedent and claimant's breach only giving rise to nominal damages - Whether judge erring.

The Case

Guarantee Construction. The Court of Appeal, Civil Division, in upholding a decision that the first and second defendants had been liable to the claimant for rent arrears accumulated by the third defendant under a guarantee, held that a provision that the claimant would use all reasonable endeavours to give written notice each time any rent payable was more than two months in arrears had not amounted to a condition precedent nor a contractual term the breach of which had extinguished liability under the guarantee.

Practice Areas

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