Termination notice by one guarantor assisted a co-guarantor when a demand was made
This story goes back to 2009 and has only just reached a successful conclusion.
It involved a £200k personal guarantee signed by 3 co-directors one of whom had a minority interest in the business. This minority interest guarantor was concerned about the long-term prospects of the business and gave 90 days notice in accordance with the terms of the guarantee. The bank failed to make a demand during that notice period and the business failed some 45 days after the expiry of the notice on the guarantee.
The other two directors continued to be pursued under the guarantees and before our client worked with us he had been making payments for a short period of time.
The matter was handed to solicitors who eventually issued proceedings. Our client was able to file a defence on these proceedings given that his position was prejudiced by the third guarantor giving notice on the same guarantee and settlement was agreed for 20% of the alleged claim.