| Case ID |
261d1993-757c-4998-a637-79a663b085ba |
| Body |
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| Case Number |
First Appeal No.53 of 2007 |
| Decision Date |
Nov 07, 2008 |
| Hearing Date |
|
| Decision |
The appeal was allowed, and the suit was decreed in the sum of Rs.3,07,545 against the respondents Nos. 2 and 3. The court determined that the liability of the guarantors was governed by the contract of guarantee, and the limitation period for the suit began upon the service of the notice of demand. It was held that even if the suit against the principal debtor was barred by limitation, the guarantors were still liable due to the continuing nature of their obligation under the guarantee. The court emphasized the importance of the guarantee's terms in determining the rights and liabilities of the parties involved. |
| Summary |
In the case of FIRST WOMEN BANK LTD. vs. Mrs. AFIFA IFTIKHAR and 2 others, the Sindh High Court addressed significant issues regarding the liability of guarantors under a financial recovery context. The case revolved around the enforcement of a guarantee agreement related to a loan facility provided to the principal debtor, Mrs. Afifa Iftikhar. The court examined the implications of the Financial Institutions (Recovery of Finances) Ordinance, the Contract Act, and the Limitation Act in determining the legal standing of the bank's claim against the guarantors after the principal debtor defaulted. It was established that the guarantors' liability commenced upon the demand for payment made by the bank, and the limitation period was calculated from that point. The judgment highlighted the enforceability of guarantees despite the principal debtor's defenses based on limitation, thereby reinforcing the creditor's rights in financial transactions. This case serves as a critical reference for understanding the dynamics of financial guarantees and the legal frameworks governing them, making it a key learning point for legal professionals and financial institutions alike. |
| Court |
Sindh High Court
|
| Entities Involved |
Not available
|
| Judges |
MRS. QAISER IQBAL, J
|
| Lawyers |
Behzad Haider for Appellant,
Mukhtar Ahmed Kuher for Respondent
|
| Petitioners |
FIRST WOMEN BANK LTD.
|
| Respondents |
2 others,
Mrs. AFIFA IFTIKHAR
|
| Citations |
2009 SLD 1841,
2009 CLD 226
|
| Other Citations |
United Bank Limited v. Business Investment Ltd. and 3 others 1982 CLC Kar. 1101,
Messrs Huffaz Seamlen Pipe Industries Ltd. and 2 others v. Messrs Security Leasing Corporation Ltd. 2002 CLD 505,
Messrs United Bank Limited v President, Bazm-e-Salat and another PLD 1986 Kar. 464,
United Bank Limited v. Haji Bawa Company Ltd. and 3 others 1981 CLC Kar. 89
|
| Laws Involved |
Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001),
Contract Act (IX of 1872),
Limitation Act (IX of 1908)
|
| Sections |
9,
10,
129,
137,
57
|