Demand guarantee: Difference between revisions
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{{magicwords|demand guarantee}} | |||
Latest revision as of 11:59, 23 December 2015
A demand guarantee is a guarantee that the guarantor must honour upon the beneficiary’s demand. The beneficiary is not required to first make a claim or take any action against the obligor of the obligation that the guarantee supports. A demand guarantee is enforceable notwithstanding any deficiencies in the enforceability of the underlying obligation.
Magic wordsTM
No demand guarantee provision would be complete without the following magical incantation:
- The beneficiary may make a demand under this guarantee without having first made any demand or taken any legal steps against the obligor
- The guarantor must pay the beneficiary on demand, in immediately available funds, ...