A Motion for Interim Injunction by Staying the Enforcement of a Bank Guarantee of Proper Performance of a Contract: The Rationale for Filing in the Context of the Abstract Nature of the Guarantee Cover Image

Wniosek o udzielenie sądowego zabezpieczenia poprzez wstrzymanie realizacji gwarancji bankowej należytego wykonania umowy – zasadność żądania w kontekście abstrakcyjnego charakteru gwarancji
A Motion for Interim Injunction by Staying the Enforcement of a Bank Guarantee of Proper Performance of a Contract: The Rationale for Filing in the Context of the Abstract Nature of the Guarantee

Author(s): Magdalena Łuczak-Golenia
Subject(s): Civil Law
Published by: Krajowa Izba Radców Prawnych
Keywords: bank guarantee; securing the proper performance of a contract; declaratory action; motion for securing a claim; public procurement law

Summary/Abstract: The majority of opinions presented in the legal doctrine and case-law indicates that appending bank guarantees with the clauses “unconditional and irrevocable” and “at first demand” determines their abstract character. Consequently, the guarantor may not effectively raise objections arising under the principal legal relationship secured by the guarantee in order to be exempted from or limit the obligation to pay he or she has accepted. Case law derives from the above mentioned viewpoint that granting an interim injunction by prohibiting drawing upon the guarantee of proper performance of a contract de facto undermines the purpose and function of a bank guarantee as a means of properly performing a contract and, in essence, renders such an interim injunction illusory. That said, courts do sometimes grant interim injunctions by prohibiting drawing upon guarantees based on the extraordinary factual circumstances of the case, including abuse of the right by the beneficiary of the guarantee. This article aims to analyze the current position taken in case law on the permissibility of securing a claim by prohibiting drawing upon a bank guarantee of proper performance of a contract.

  • Issue Year: 2018
  • Issue No: 2
  • Page Range: 133-152
  • Page Count: 20
  • Language: Polish