Cases

Singer & Friedlander Commercial Finance Ltd v Thomas

Facts

The claimant, which lent money to companies to help them finance the acquisition of substantial assets, agreed to purchase and let on hire to British Creameries Ltd, of which the defendant was chairman and a substantial shareholder, cheese packing machinery costing in excess of £250,000. Payment of the hire charges by British Creameries to the claimant was to be secured by a chattel mortgage on some of the other machinery owned by the company. However, since that machinery was the subject of charges by Lloyds TSB and other parties and British Creameries was anxious to obtain the packaging machinery as quickly as possible, the defendant gave a personal guarantee to the claimant which it was agreed would lapse as soon as the chattel mortgage was “in place”. The machinery was purchased by the claimant and delivered to British Creameries.

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