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Trafalgar House Construction (Regions) Limited v General Surety and Guarantee Company Limited

Language: English Series: Construction Law Journal ; (1994) 10 CLJ 240-246(7)Publication details: 1994Subject(s): Summary: CA 22 February 1994. In 1989 T entered into a building contract to construct a leisure complex. The groundworks were subcontracted and they obtained a bond from the subcontractors equal to 10% of the subcontract value. Before they completed the groundwork the subcontractors went into receivership and T finished the work. T commenced proceedings against G the guarantor of the bond for the sum of £101,285. The court held that T should receive that sum on the grounds that they was no arguable defence. G appealed but this was dismissed on the grounds that the obligation of the surety arose when called upon to pay any damages resulting from the subcontractors failure to perform.

CA 22 February 1994. In 1989 T entered into a building contract to construct a leisure complex. The groundworks were subcontracted and they obtained a bond from the subcontractors equal to 10% of the subcontract value. Before they completed the groundwork the subcontractors went into receivership and T finished the work. T commenced proceedings against G the guarantor of the bond for the sum of £101,285. The court held that T should receive that sum on the grounds that they was no arguable defence. G appealed but this was dismissed on the grounds that the obligation of the surety arose when called upon to pay any damages resulting from the subcontractors failure to perform.