Law:

Section:

(a) Banker and customer Documentary letter of credit, establishing of Duty of bank Scope Bank deals only with documents and not with underlying goods or services which may be subject matter of any agreement between a foreign supplier and a local importer of such goods or services Opening of letter of credit by the Bank is only required to see the documents conforming to the letter of credit. Haral Textiles Limited v. Banque Indosuez Belgium, S.A. and others 1999 SCMR 591 ref. (b) Contract Act (IX of 1872) Ss. 128 & 146 Liability of surety Extent Discharge of liability after entering of new surety Scope Guarantor had resigned from the Board of Directors of the principal debtor New Director had given personal guarantee in favour of bank to secure liabilities of the principal debtor -Former director did not apply to the bank for cancellation and return of his personal guarantee nor he sought any release or confirmation, showing discharge of the liability ¬Effect Such act of the former director could not by mere implication result in discharging the Director from his liability under the personal guarantee executed by him ¬Former director remained liable to repay the amounts owed by the principal debtor in circumstances. (c) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997) Ss.9 & 10 Recovery of bank loan Leave to defend the suit, refusal of Disputes between two groups of share¬holders of the borrower company Defendants were in litigation with each other before Civil Court and also before Companies Judge Effect Such legal proceedings had no bearing on the claim asserted by the bank in its suit against the defendants Leave to defend the suit was rightly refused and suit was rightly decreed by the High Court ¬Appeal was dismissed in circumstances. JUDGMENT JAWWAD S. KHAWAJA, J. This judgment will dispose of RFA No.479 of 1998 filed by S.A. Hameed and RFA N6.484 of 1998 filed by four appellants, namely, Sheikh Muhammad Ashraf, Dilawar Mahmood, Nabeel Ashraf and Khurshid A. Khan. Both appeals impugn the same judgment and decree dated 24 9 1998 passed by a learned Single Bench. 2. The facts necessary for the disposal of these…

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