Accessing Practical Law Finance's guarantees resources

A guide to Practical Law Finance's resources on guarantees, including key practice notes and a list of standard form guarantees and indemnities relating to different types of transactions.

Contents

Introduction

This note acts as a guide to Practical Law Finance's resources on guarantees.

 

Overview of the law on guarantees and indemnities

 

Variation of guaranteed obligations

Practice note, Variation of guaranteed obligations ( www.practicallaw.com/7-228-2952) , examines the extent to which an underlying contract, which is the subject of a guarantee, can be amended or varied without that variation of contract discharging the guarantee and releasing the guarantor from its liability.

 

Termination and discharge

Practice note, Guarantees: termination and discharge ( www.practicallaw.com/4-505-8791) , considers:

  • When and how a guarantee can be terminated, and the effect of termination.

  • What happens to a guarantee if the guarantor dies or becomes mentally incapable.

  • How a guarantee is discharged.

  • The circumstances in which a guarantee may be set aside (undue influence, misrepresentation, breach of contract, duty to disclose and loss of security).

  • The application of these principles to indemnities.

 

Enforcing guarantees

 

Insolvency

Practice note, Corporate insolvency and guarantees: overview ( www.practicallaw.com/6-519-7404) , considers the impact of corporate insolvency on guarantees.

Practice note, How to insolvency proof your guarantee ( www.practicallaw.com/9-619-9288) , a guide to drafting and negotiating some of the clauses that are most significant when protecting a beneficiary or a guarantor from the effects of the primary obligor or the guarantor (or both) becoming insolvent.

 

Standard documents and clauses

Below is a list of our standard form guarantees and indemnities. They are categorised by the type of transactions they relate to or are most commonly associated with.

Where a standard document or clause does not have integrated drafting notes, a link to the stand-alone drafting notes will appear at the top of the page.

For a list of standard form guarantees available from Practical Law practice areas other than Finance, see Standard documents and clauses from other practice areas.

Lending transactions

Corporate guarantees and indemnities

Personal guarantees and indemnities

For guidance on taking a guarantee from an individual, see Practice note, Practical guidance from the House of Lords for banks and solicitors dealing with guarantees and security by individuals ( www.practicallaw.com/6-107-3969) .

Automated FastDraft version

Guarantee and indemnity - automated FastDraft version ( www.practicallaw.com/0-506-7472) incorporates questions which allow you to quickly choose between the different types of guarantee (e.g. between an all monies guarantee or specific liabilities, and between a corporate or individual guarantor). It also allows you to import details of the parties from Companies House and make online changes to other aspects of the document.

Construction contracts

Demand bonds

  • Advance payment bond ( www.practicallaw.com/7-518-6787) . An on demand advance payment bond (also called an advance payment guarantee) involving an independent payment obligation, to be issued in letter form, typically by a bank. The bond is primarily intended for use on a construction and engineering project, although it could be used or adapted for other commercial supply contracts, including where a customer pays a supplier in advance for a piece of machinery or equipment.

  • On demand bid bond ( www.practicallaw.com/1-518-5984) . An on demand bid bond (also called a tender bond or tender guarantee) involving an independent payment obligation, to be issued in letter form, typically by a bank. The bond is primarily intended for use on a construction and engineering project, although bid bonds are rare in the UK construction market.

Trade finance

Sharia compliant guarantees

Corporate authorisations

 

Books online

The following chapters of Bloomsbury Professional books online discuss various issues in relation to guarantees:

 

Global guide

Finance globall guide: Country Q&A tool: Guarantees ( www.practicallaw.com/2-500-7830) , provides information on the creation of guarantees in different jurisdictions.

 

Links to Practical Law resources on guarantees

Practical Law Finance resources on guarantees

Links to Practical Law Finance resources on guarantees:

Standard documents and clauses from other practice areas

Asset and share purchase agreements

The following standard documents and clauses have been published by Practical Law Corporate:

Commercial contracts

The following standard documents and clauses have been published by Practical Law Commercial and Practical Law IPIT & Communications:

Construction contracts: parent company guarantees

The following standard documents have been published by Practical Law Construction:

Real estate transactions

The following standard documents and clauses have been published by Practical Law Property:

For issues that need to be considered when drafting guarantee and indemnity clauses in commercial leases, see the following Practical Law Property practice notes:


Useful links

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