October, 2019 - No guarantees: The Rubicon Vantage
- Date: 30/10/2019
Is it necessary for a guarantor to pay even if the underlying liability is disputed? This was considered recently in Rubicon Vantage International Pte Ltd v KrisEnergy Ltd (The “Rubicon Vantage”)  EWHC 2012 (Comm).
The claimant, Rubicon Vantage International Pte Ltd (“Rubicon”), owned a floating storage and offloading facility, which it chartered to KrisEnergy (Gulf of Thailand) Ltd (“Kegot”). Kegot was a wholly owned subsidiary of the defendant, KrisEnergy Ltd (“KrisEnergy”). KrisEnergy provided a guarantee to Rubicon for any sums owed under the charter by Kegot. Rubicon sent a series of invoices to Kegot, four of which were disputed, together totalling just over $1.8m. The disputed invoices remained outstanding and, on 3rd September, 2018 Rubicon made a demand on KrisEnergy under the guarantee. KrisEnergy refused to pay, leading Rubicon to commence court proceedings.
To learn more about the lessons which can be drawn from this case and the importance when drafting guarantees that parties should be clear about what it is they intend to achieve and use appropriate wording, download the full article here