WORKINGTON HARBOUR & DOCK BOARD v. TRADE INDEMNITY COMPANY.

(1936) 54 Ll.L.Rep. 103

HOUSE OF LORDS.

Before Lord Atkin, Lord Thankerton, Lord Russell of Killowen, Lord Macmillan and Lord Roche.

Contract - Guarantee - Construction of works by K & R on plaintiffs' dock premises at Workington-Instructions to persons tendering that contractor must make his own independent inquiries as to the site and the water therein, and that the plaintiffs would not be bound by any representation that their engineers or their employees or the plaintiffs' employees might make to the contractors, unless in writing by the clerk to the plaintiffs-Tender by K & R-K & R notified that tender would be accepted if they provided guarantee-Surety bond for £50,000 entered into by defendants guaranteeing K & R's performance of contract- Failure of K & R to complete contract -Work completed by plaintiffs-Claim under bond-Defence that bond was void on ground that there was misrepresentation by the plaintiffs as to water in the site and non-disclosure of facts leading up to the acceptance by the plaintiffs of K & R's tender- Plaintiffs' duty of disclosure-Whether contract bond one of guarantee or insurance -Distinction between contracts of guarantee and of insurance-Evidence of agreements for loans made by plaintiffs to K & R during course of contract work-Indebtedness of K & R to plaintiffs denoted by final certificate issued by plaintiffs' engineers, certifying that £78,785 was due-Sum including balance due upon loans for principal and interest-Whether certificate binding on defendants.