DOW BANKING CORPORATION v. MAHNAKH SPINNING AND WEAVING CORPORATION AND BANK MELLAT

[1983] 2 Lloyd's Rep. 561

QUEEN'S BENCH DIVISION(COMMERCIAL COURT)

Before Mr. Justice Lloyd

Banking - Guarantee - Limitation of liability - Plaintiff loaned $5,000,000 to first plaintiffs - Bank guaranteed up to a maximum of $6,000,000 including interest - First defendants defaulted - Plaintiffs claimed on guarantee - Plaintiffs recovered $6,250,000 - Whether plaintiffs entitled to rely on earlier defaults - Whether bank entitled to limit liability.