On the last occasion when this writer commented on the autonomy of unconditional performance bonds from the underlying transaction in Singapore,1 it was observed that the High Court of Singapore seemed prepared to overlook such autonomy, as shown by Royal Design Studio v. Chang Development.2 There have been several developments since that case, culminating in the decision of the Court of Appeal in Bocotra Construction Pte. Ltd. and Others v. Attorney-General (No. 2).3 This paper will examine those developments and comment on the status of such bonds in Singapore.

Royal Design created an inroad to the autonomy principle governing demand performance bonds. The court there relied on dicta in an English case, Potton Homes,4 to support the proposition that, in considering whether to grant an injunction against payment under such a bond, it makes a difference to the court whether the injunction is sought against the fellow contracting party or the bank. This decision, as was noted earlier,5 flew in the face of the English authorities such as Edward Owen Engineering Ltd. v. Barclays Bank International Ltd.6 Apart from its unsatisfactory reasoning, the decision left parties with the option of choosing who to proceed against, in order to circumvent the autonomy principle.

(as he then was) granted an order restraining the defendants from receiving the monies