CIC Feeds (Pvt) Ltd. vs. Pan Asia Bank – sllr 2016 volume 1 page 006

In the case between CIC FEEDS (PVT) LTD. and PAN ASIA BANK, the court considered whether a bank guarantee constitutes an accessory contract and if the bank’s refusal to issue such a guarantee amounts to a breach of contractual obligation, either express or implied. It was determined that the essential element for contract formation—the intention to create legal relations—must be evidenced, particularly with respect to the required documentation for a bank guarantee. Upon examination of the materials and correspondence presented, including documentary exhibits and the sequence of events following the provision of funds and a security cheque, the findings established that the absence of proper documentation and clear intent precluded the formation of an enforceable contract. The decision dis