Introduction
A Division Bench of the Madras High Court, in Banque
Cantonale De Geneve vs. Owners and Parties Interested in the Vessel
M V Polaris Galaxy by its recent judgement and order of 13
July 2021, provided much needed guidance on the wording and terms
of a bank guarantee furnished to the court as security for a
claim.1
Typically, property that is attached is released by furnishing a
bank guarantee issued to the court. Such guarantees are to remain
valid until disposal of the suit. There have been cases where
litigants have intentionally or otherwise procured guarantees
renewable at their instance. Clearly, claimants run the risk of
their claim being unsecured in the event that the guarantee is not
renewed before its expiry. This could result in the claimant being
remediless, particularly where the defendant does not have any
assets within the jurisdiction of the court. The Madras High
Court's recent judgement remedies the problem by directing
litigants to
