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ARTICLE · 27 AUGUST 2026

TTSJV & Ors v BapCo Refining B.S.C.: Drawing The Threads Together On Preventing A Call

Fenwick Elliott LLP
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When can a contractor prevent a beneficiary from calling on an On Demand Bond? Recent case law has struggled to reconcile two competing legal principles: the traditional fraud exception and contractual restrictions on making calls. A 2026 judgment clarifies the threshold required to obtain an injunction against bond calls.

United KingdomLitigation, Mediation & Arbitration
Claire King
Claire King
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Ever since the 2011 case of Simon Carves Ltd v Ensus UK Ltd [2011] EWHC 657 (TCC), the door to preventing a call on an On Demand Bond (also referred to as Performance Guarantees), by obtaining an injunction against the beneficiary pursuant to the underlying contract, has been more ajar than the historic case law perhaps indicated it should be. In the Simon Carves case, Akenhead J stated:

“In principle, if the underlying contract, in relation to which the bond has been provided by way of security, clearly and expressly prevents the beneficiary party to the contract from making a demand under the bond, it can be restrained by the Court from making a demand on the bond.”

This is arguably a dilution of the commercial value of an On Demand Bond. After all the classic test for preventing a bank paying out on an On Demand Bond is an extremely hard test to satisfy. It was Lord Denning who famously set out the test in the 1978 case Edward Owen Engineering v Barclays Bank International [19

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