Re: Re: Are Bank Guarantees worth the paper they’re written on?

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@charlie wrote:

A question for the legal-eagles: As the banks themselves are supposed to be covered for the BG by the developer, why are they so hell-bent in not paying up? I can only conclude they are corruptly in cahoots with the developer re. not paying up if at all possible.

Developers are very quick to put stringent daily penalties for every day purchasers do not complete as in the case of one development I know, but it seems that when there are multi-breaches of contract, claiming on the Bank Guarantee is proving to be impossible in many cases.

Because it’s normal.

You seriously cannot expect to walk in a bank and claim on a bank guarantee for a breach of contract for say 150.000 Euros, that comes out of the bank’s coffer incidentally not the developer’s, and have the bank manager ask you if you rather want it in 500 euro notes or if it’s ok through a bank transfer. Come on…of course they are going to put a fight over it. It’s the bank’s money we’re talking of regardless if they later on go against the developer for it.

Sadly, this isn’t the case otherwise why would you need to pay a lawyer to do this when it can be so easily achieved ?

Banks/Insurance Companies will claw, fight and shout back at you (the lawyer) so as not to pay and will hold on to anything they can to avoid it. It is only obvious they will appeal any ruling, it’s absolutely normal to do so.

But that’s part of our job to recover the secured funds/stage payments of our clients. Yes, it takes some time; nothing is ever easy in life is it ? But it works.

We haven’t had any case in which we haven’t recovered a client’s money providing there was a BG in place. It takes some time (many months), perhaps even a year but we recover it.

I have been warning people ad nauseam over the years in this and other websites regarding these BGs or IPs because if the developers go broke you will lose your stage payments -period-.

I can say it louder but not clearer.