Kuwait Court of Cassation principle number 1787

A letter of guarantee. Its nature. An undertaking by the bank, at its customer’s request, to pay a specified amount to the beneficiary whenever the latter demands it within the period specified therein. The independence of this obligation from the relationship between the bank and the customer and that between the latter and the beneficiary. The effect thereof. The bank’s payment to the beneficiary within the period discharges its liability. The beneficiary’s waiver of his right or extinguishment of the bank’s obligation for any other reason. Its effect. Release of the security furnished by the customer. - 343 - Obligation