On Demand Performance Bonds – How to make them less of a threat

Contractors tend to be wary of  ‘on demand’ performance bonds as there is usually no protection against the bond being called unfairly. The courts have generally refused to prevent a bond from being called except in the case of proven fraud.

But a new case this month, Simon Carves v. Ensus UK,  suggests that if the underlying contract contains restrictions on the client’s right to call the bond, then the English courts will grant an injunction preventing payment.   For more details, see this article on Giles Dixon’s website.

This entry was posted in Online Legal Templates, Property & Construction and tagged by Giles. Bookmark the permalink.

About Giles

Giles is the founder and managing director of ContractStore. It was his idea to set up a company selling documents online and he has played a major part in the company's development. He is an English solicitor, with over thirty years' experience of drafting and negotiating commercial and construction contracts in the UK and overseas. Giles has long been convinced that there is a quicker and simpler approach to the delivery and supply of most contracts, and he is an active proponent of the use of plain English in legal documents. He specialises in the drafting of construction and engineering contracts and as well as contributing contracts to the ContractStore website, he is co-author of the JCT Constructing Excellence Contract and of 'Exporting Made Easy' with Simon Bedford.

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