{"id":6185,"date":"2026-07-14T19:48:16","date_gmt":"2026-07-14T11:48:16","guid":{"rendered":"https:\/\/yhalaw.com.my\/?p=6185"},"modified":"2026-07-14T19:48:16","modified_gmt":"2026-07-14T11:48:16","slug":"guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees","status":"publish","type":"post","link":"https:\/\/yhalaw.com.my\/my\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/","title":{"rendered":"GUARANTEE &#8211; PERSONAL GUARANTEE \u2260 PAY ON DEMAND: COURT DRAWS THE LINE BETWEEN SURETYSHIP AND DEMAND GUARANTEES"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">1. Summary and Facts:<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em><u>CE Energy DMCC v Bashar CE Energy DMCC v Ultimate Oil &amp; Gas DMCC<\/u><\/em><\/strong> [2026] Lloyds\u2019s Rep 267 concerns on CE Energy DMCC sold gasoil and jet fuel to Ultimate Oil &amp; Gas DMCC (\u201c<strong>UOG<\/strong>\u201d) between 2022 and 2023 under several spot contracts and a later term contract. Ultimate failed to pay all sums due, including price, interest, and demurrage. In January 2024, both parties signed a Payment Agreement where Ultimate admitted the debts and agreed to repay in instalments. To secure that, a personal guarantee also given by Bashar. CEE then supplied one further cargo. UOG later defaulted in payment. CEE then demanded about USD 34.7 million from both Ultimate and Bashar under the guarantee and UOG for payment of the final cargo supplied under a new spot contract. CE Energy applied for summary judgment before the English Court, even though it had not yet obtained any arbitration award or prior judgment against Ultimate.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">2. Legal Issues:<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Whether the guarantee a demand guarantee or a surety guarantee.<\/li>\n\n\n\n<li>Whether UOG\u2019s admission of debt in the Payment Agreement binding.<\/li>\n\n\n\n<li>Whether CE Energy can sue for the price of goods even though title in the goods had been retained under the contracts.<\/li>\n\n\n\n<li>Whether the defendants have the realistic defences to avoid summary judgment.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">3. Court\u2019s Findings:<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The Court held that the guarantee was not a demand guarantee, but a contract of suretyship.<\/li>\n\n\n\n<li>CE Energy had to prove UOG was in default but did not need first to obtain an arbitral award of court judgment against UOG before suing Bashar.<\/li>\n\n\n\n<li>UOG had \u201cirrevocably admitted\u201d the outstanding sums in the Payment Agreement where the court treated this as contractual estoppel (a binding promise preventing UOG and guarantor from denying the debts later.)<\/li>\n\n\n\n<li>CE Energy could still sue for the price although the title to the oil had been retained because the payment was due on a fixed date, satisfying section 49(2) of the Sale of Goods Act 1979.<\/li>\n\n\n\n<li>The defendants\u2019 arguments about incorrect allocation of payments, demurrage, and interest had no realistic prospect of success.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">4. Practical Implications:<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">This judgment affirms the several principle of laws including:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Not All \u201cOn Demand\u201d Guarantees Are Demand Guarantees.<\/li>\n\n\n\n<li>Personal Guarantees by Directors Carry Real Risk.<\/li>\n\n\n\n<li>Settlement Agreements Can Lock You In.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">If you need more information on our legal updates, our Knowledge and Law News Division at <a href=\"mailto:lawnews@yhalaw.com.my\">lawnews@yhalaw.com.my<\/a> would be pleased to assist.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Yew Huoi, How &amp; Associates (Law Firm)<\/strong><br>Advocates &amp; Solicitors<br>No. 1, Jalan Riangria 6<br>Taman Desa Tiara, Off Jalan Klang Lama<br>58200 Kuala Lumpur<br>Tel: +603-7971 3191<br>Fax: +603-7972 9131<br>Email: <a href=\"mailto:enquiry@yhalaw.com.my\">enquiry@yhalaw.com.my<\/a><br>Website: <a href=\"https:\/\/yhalaw.com.my\">https:\/\/yhalaw.com.my<\/a><\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p class=\"wp-block-paragraph\"><small>\u00a92026. YEW HUOI, HOW &amp; ASSOCIATES. ALL RIGHTS RESERVED. The contents of this legal updates are intended for general information only and should not be construed as legal advice or legal opinion. If you need further advice or explanation on the subject, please contact our firm. Please do not reproduce, transmit or distribute the contents therein in any form, or by any means as Legal Profession (Publicity) Rules 2001 restrict such circulation.<\/small><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><small>Note: This material is intended for general information with regard to the practice of YHA. This profile is not intended to create, and does not create a solicitor-client relationship. If you are interested in having YHA to represent you, you must call or visit our office to enable us to discuss the legal matter with you. YHA reserves our right to decline any representation which is in contravention with the Legal Profession Act 1976 and\/or the regulations therein.<\/small><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In CE Energy DMCC v Bashar [2026] Lloyds\u2019s Rep 267, the Commercial Court clarified that not all guarantees labelled \u201con demand\u201d will be treated as demand guarantees. On a proper construction, the court held that the personal guarantee in question was a contract of suretyship, requiring proof of the principal debtor\u2019s liability rather than automatic payment upon demand. Crucially, the court found that the debtor\u2019s \u201cirrevocable\u201d admissions of debt in a payment agreement created a binding contractual estoppel, which the guarantor could not challenge. The decision also confirms that, where payment is due on a \u201cday certain\u201d, a seller may still claim the price notwithstanding retention of title. The case underscores the importance of precise drafting and the risks of entering into settlement agreements that conclusively fix liability.<\/p>\n","protected":false},"author":1,"featured_media":6187,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1568],"tags":[3851,3856,3858,3854,3857,3852,3685,3855,3853],"class_list":["post-6185","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-contract-law","tag-ce-energy-dmcc","tag-contractual-estoppel","tag-demand-guarantee","tag-ersonal-guarantee","tag-payment-agreement","tag-sale-of-goods-act-1979","tag-summary-judgment","tag-suretyship","tag-ultimate-oil-gas-dmcc"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>GUARANTEE - PERSONAL GUARANTEE \u2260 PAY ON DEMAND: COURT DRAWS THE LINE BETWEEN SURETYSHIP AND DEMAND GUARANTEES | Yew Huoi, How &amp; Associates | Leading Malaysia Law Firm<\/title>\n<meta name=\"description\" content=\"In CE Energy DMCC v Bashar [2026] Lloyds\u2019s Rep 267, the Commercial Court clarified that not all guarantees labelled \u201con demand\u201d will be treated as demand guarantees. On a proper construction, the court held that the personal guarantee in question was a contract of suretyship, requiring proof of the principal debtor\u2019s liability rather than automatic payment upon demand. Crucially, the court found that the debtor\u2019s \u201cirrevocable\u201d admissions of debt in a payment agreement created a binding contractual estoppel, which the guarantor could not challenge. The decision also confirms that, where payment is due on a \u201cday certain\u201d, a seller may still claim the price notwithstanding retention of title. The case underscores the importance of precise drafting and the risks of entering into settlement agreements that conclusively fix liability.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/yhalaw.com.my\/my\/guarantee-personal-guarantee-\u2260-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/\" \/>\n<meta property=\"og:locale\" content=\"ms_MY\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"GUARANTEE - PERSONAL GUARANTEE \u2260 PAY ON DEMAND: COURT DRAWS THE LINE BETWEEN SURETYSHIP AND DEMAND GUARANTEES | Yew Huoi, How &amp; Associates | Leading Malaysia Law Firm\" \/>\n<meta property=\"og:description\" content=\"In CE Energy DMCC v Bashar [2026] Lloyds\u2019s Rep 267, the Commercial Court clarified that not all guarantees labelled \u201con demand\u201d will be treated as demand guarantees. On a proper construction, the court held that the personal guarantee in question was a contract of suretyship, requiring proof of the principal debtor\u2019s liability rather than automatic payment upon demand. Crucially, the court found that the debtor\u2019s \u201cirrevocable\u201d admissions of debt in a payment agreement created a binding contractual estoppel, which the guarantor could not challenge. The decision also confirms that, where payment is due on a \u201cday certain\u201d, a seller may still claim the price notwithstanding retention of title. The case underscores the importance of precise drafting and the risks of entering into settlement agreements that conclusively fix liability.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/yhalaw.com.my\/my\/guarantee-personal-guarantee-\u2260-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/\" \/>\n<meta property=\"og:site_name\" content=\"Yew Huoi, How &amp; Associates | Leading Malaysia Law Firm\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/yhalaw\" \/>\n<meta property=\"article:published_time\" content=\"2026-07-14T11:48:16+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/yhalaw.com.my\/wp-content\/uploads\/2026\/07\/guarantee.avif\" \/>\n\t<meta property=\"og:image:width\" content=\"1731\" \/>\n\t<meta property=\"og:image:height\" content=\"909\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"YHA Admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"YHA Admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minit\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\\\/\"},\"author\":{\"name\":\"YHA Admin\",\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/#\\\/schema\\\/person\\\/f778c60834a29c5ec215ab62d3207bef\"},\"headline\":\"GUARANTEE &#8211; PERSONAL GUARANTEE \u2260 PAY ON DEMAND: COURT DRAWS THE LINE BETWEEN SURETYSHIP AND DEMAND GUARANTEES\",\"datePublished\":\"2026-07-14T11:48:16+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\\\/\"},\"wordCount\":592,\"publisher\":{\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/yhalaw.com.my\\\/wp-content\\\/uploads\\\/2026\\\/07\\\/guarantee.avif\",\"keywords\":[\"CE Energy DMCC\",\"Contractual Estoppel\",\"Demand Guarantee\",\"ersonal Guarantee\",\"Payment Agreement\",\"Sale of Goods Act 1979\",\"Summary Judgment\",\"Suretyship\",\"Ultimate Oil &amp; Gas DMCC\"],\"articleSection\":[\"Contract Law\"],\"inLanguage\":\"ms-MY\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\\\/\",\"url\":\"https:\\\/\\\/yhalaw.com.my\\\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\\\/\",\"name\":\"GUARANTEE - PERSONAL GUARANTEE \u2260 PAY ON DEMAND: COURT DRAWS THE LINE BETWEEN SURETYSHIP AND DEMAND GUARANTEES | Yew Huoi, How &amp; Associates | Leading Malaysia Law Firm\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/yhalaw.com.my\\\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/yhalaw.com.my\\\/wp-content\\\/uploads\\\/2026\\\/07\\\/guarantee.avif\",\"datePublished\":\"2026-07-14T11:48:16+00:00\",\"description\":\"In CE Energy DMCC v Bashar [2026] Lloyds\u2019s Rep 267, the Commercial Court clarified that not all guarantees labelled \u201con demand\u201d will be treated as demand guarantees. 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On a proper construction, the court held that the personal guarantee in question was a contract of suretyship, requiring proof of the principal debtor\u2019s liability rather than automatic payment upon demand. Crucially, the court found that the debtor\u2019s \u201cirrevocable\u201d admissions of debt in a payment agreement created a binding contractual estoppel, which the guarantor could not challenge. The decision also confirms that, where payment is due on a \u201cday certain\u201d, a seller may still claim the price notwithstanding retention of title. The case underscores the importance of precise drafting and the risks of entering into settlement agreements that conclusively fix liability.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/yhalaw.com.my\/my\/guarantee-personal-guarantee-\u2260-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/","og_locale":"ms_MY","og_type":"article","og_title":"GUARANTEE - PERSONAL GUARANTEE \u2260 PAY ON DEMAND: COURT DRAWS THE LINE BETWEEN SURETYSHIP AND DEMAND GUARANTEES | Yew Huoi, How &amp; Associates | Leading Malaysia Law Firm","og_description":"In CE Energy DMCC v Bashar [2026] Lloyds\u2019s Rep 267, the Commercial Court clarified that not all guarantees labelled \u201con demand\u201d will be treated as demand guarantees. 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The case underscores the importance of precise drafting and the risks of entering into settlement agreements that conclusively fix liability.","og_url":"https:\/\/yhalaw.com.my\/my\/guarantee-personal-guarantee-\u2260-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/","og_site_name":"Yew Huoi, How &amp; Associates | Leading Malaysia Law Firm","article_publisher":"https:\/\/www.facebook.com\/yhalaw","article_published_time":"2026-07-14T11:48:16+00:00","og_image":[{"width":1731,"height":909,"url":"https:\/\/yhalaw.com.my\/wp-content\/uploads\/2026\/07\/guarantee.avif","type":"image\/png"}],"author":"YHA Admin","twitter_card":"summary_large_image","twitter_misc":{"Written by":"YHA Admin","Est. reading time":"3 minit"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/yhalaw.com.my\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/#article","isPartOf":{"@id":"https:\/\/yhalaw.com.my\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/"},"author":{"name":"YHA Admin","@id":"https:\/\/yhalaw.com.my\/#\/schema\/person\/f778c60834a29c5ec215ab62d3207bef"},"headline":"GUARANTEE &#8211; PERSONAL GUARANTEE \u2260 PAY ON DEMAND: COURT DRAWS THE LINE BETWEEN SURETYSHIP AND DEMAND GUARANTEES","datePublished":"2026-07-14T11:48:16+00:00","mainEntityOfPage":{"@id":"https:\/\/yhalaw.com.my\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/"},"wordCount":592,"publisher":{"@id":"https:\/\/yhalaw.com.my\/#organization"},"image":{"@id":"https:\/\/yhalaw.com.my\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/#primaryimage"},"thumbnailUrl":"https:\/\/yhalaw.com.my\/wp-content\/uploads\/2026\/07\/guarantee.avif","keywords":["CE Energy DMCC","Contractual Estoppel","Demand Guarantee","ersonal Guarantee","Payment Agreement","Sale of Goods Act 1979","Summary Judgment","Suretyship","Ultimate Oil &amp; Gas DMCC"],"articleSection":["Contract Law"],"inLanguage":"ms-MY"},{"@type":"WebPage","@id":"https:\/\/yhalaw.com.my\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/","url":"https:\/\/yhalaw.com.my\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/","name":"GUARANTEE - PERSONAL GUARANTEE \u2260 PAY ON DEMAND: COURT DRAWS THE LINE BETWEEN SURETYSHIP AND DEMAND GUARANTEES | Yew Huoi, How &amp; Associates | Leading Malaysia Law Firm","isPartOf":{"@id":"https:\/\/yhalaw.com.my\/#website"},"primaryImageOfPage":{"@id":"https:\/\/yhalaw.com.my\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/#primaryimage"},"image":{"@id":"https:\/\/yhalaw.com.my\/guarantee-personal-guarantee-%e2%89%a0-pay-on-demand-court-draws-the-line-between-suretyship-and-demand-guarantees\/#primaryimage"},"thumbnailUrl":"https:\/\/yhalaw.com.my\/wp-content\/uploads\/2026\/07\/guarantee.avif","datePublished":"2026-07-14T11:48:16+00:00","description":"In CE Energy DMCC v Bashar [2026] Lloyds\u2019s Rep 267, the Commercial Court clarified that not all guarantees labelled \u201con demand\u201d will be treated as demand guarantees. On a proper construction, the court held that the personal guarantee in question was a contract of suretyship, requiring proof of the principal debtor\u2019s liability rather than automatic payment upon demand. Crucially, the court found that the debtor\u2019s \u201cirrevocable\u201d admissions of debt in a payment agreement created a binding contractual estoppel, which the guarantor could not challenge. The decision also confirms that, where payment is due on a \u201cday certain\u201d, a seller may still claim the price notwithstanding retention of title. 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