CIC FEEDS (PVT) LTD. VS. PAN ASIA BANK

CIC FEEDS (PVT) LTD.
VS.
PAN ASIA BANK

SUPREME COURT
EVA WANASUNDARA, PC J.
PRIYANTHA JAYAWARDENA, PC J,
ANIL GOONERATNE. J
S.C.(CHC) APPEAL NO 36/2004
CHC CASE NO. 169/2002 (1)
SEPTEMBER 17, 2015

Bank guarantees - Liability of a banker? -Is it an accessory contract ? -Should the intention to create legal relations be considered if the Bank refuses to issue a guarantee ? - Could one look at any undertaking in an express or implied agreement to issue a guarantee?

The Plaintiff Appellant Company instituted action against the Defendant Bank for the recovery of a certain sum of money on several causes of action.

The Plaintiff complained that when a Company not a party to the suit - who is a customer of the Plaintiff Appellant Company and who purchased animal feed on credit - Company A and a customer of the Defendant Bank was called upon to make arrangements with the Defendant Dank to issue a Bank guarantee for Rs. 8,000,000.00 in favour of Citi Bank (the Bank of the Plaintiff Appellant Company) - to secure Citi Bank against any dishonor of post dated cheques presented by A company, and enable Citi Bank to recover payment upon the g

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