Instagroup Limited v Northwest Insulations Limited (In Liquidation) [2026] EWHC 819 (Ch)

[2026] EWHC 819 (Ch)Case No BL-2024-001377
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Venue Royal Courts of Justice, Rolls Building, Fetter Lane, London, EC4A 1NLDate 14/4/2026
Before
MASTER CLARK
Between
INSTAGROUP LIMITEDClaimantNORTHWEST INSULATIONS LIMITED (in liquidation)DefendantsMR DAVID STANSFIELDDefendant
Richard Bowles (instructed by Clarkslegal LLP) for ClaimantSimon Vaughan (instructed by Horwich Farrelly Limited) for 2 nd DefendantHearing Hearing date: 6 November 2025
Approved JudgmentThis judgment was handed down remotely at 10.00am on 14 April 2026 by circulation to the parties or their representatives by e-mail and by release to the National Archives..............................Master Clark:Application
[1]This is my judgment on the second defendant’s application dated 16 June 2025 for reverse summary judgment.

Parties and the factual background

[2]The claimant, InstaGroup Limited, makes and supplies insulation materials. It subcontracts the installation of those materials to third parties. Much of this subcontracted work is funded under various government environmental schemes and the grants available to energy providers under those schemes.[3]The first defendant, Northwest Insulations Limited (“the Company”), was an insulation installer. It was incorporated on 27 August 2008, and had a contractual relationship as an insulation installer with the claimant from shortly after its incorporation until about 2022. It filed a Defence to the claim. On 8 August 2025 it entered into a creditors’ voluntary liquidation. It is not a party to this application.[4]The second defendant, David Stansfield, was a director of the Company from 27 August 2008 until 19 April 2022, and has throughout held one of the 3 allotted shares in it.[5]In 2008 the claimant entered into agreements with certain energy suppliers for the installation of cavity wall insulation ("CWI") in qualifying residential properties, pursuant to the "Carbon Emissions Reduction Target" ("CERT"). This was a government scheme under which energy suppliers were required to achieve targets for the reduction of carbon emissions. One way in which suppliers sought to reach these targets was by installing CWI in homes, for which Government funding was available.[6]The claimant alleges that it and the Company had entered into an agreement in relation to conducting works under CERT, which ran from 1 April 2008 until 31 March 2012. That agreement was not in evidence, and it was unexplained how the Company entered into an agreement preceding its incorporation.[7]On 2 October 2008, the Company entered into a credit facility agreement (“the 2008 Agreement”) with the claimant (then called InstaFoam and Fibre Limited). The second defendant signed a pre-printed form entitled “Credit Account Application Form”, which included:
"In consideration for [the claimant] agreeing to supply goods on credit as requested I, [the second defendant] being a director of [the Company] agree that all transactions of sale shall be subject to your Sale Conditions operative at the time of any contract of sale and that the [Company] will make full settlement of all monies that are now or shall at any time in the future become due from the [the Company] to [the claimant] howsoever arising."
(emphasis added) and “I hereby personally guarantee payment in respect of all such sums as are now or shall in the future become due from [the Company] to [the claimant] including interest at the rate specified in your Conditions of Sale or which shall otherwise be payable by law. This guarantee is to be a continuing guarantee and my liability under it shall not be affected by your giving time or any other indulgence to [the Company] or to me by any credit limit which may have been imposed from time to time or by any other matter or event whereby I would but for this provision have been released” (“the Guarantee”)[8]The form also included: “Maximum Value of monthly purchases you intend to make £8,000 (Credit Limit)” with the figure £8,000 in written in manuscript, and the second defendant’s signature underneath it, with the date 11 September 2008.[9]The claimant’s case is that this form was used as part of a wider commercial relationship between it and its suppliers. Its evidence, as stated by its CEO, David Robson, in his witness statement dated 29 October 2025 (“Robson 1”) is that:(1) the claimant had a limited supply of government funded work (such as the CERT work), which he refers to as “grant work” [Robson 1, para 6]; and(2) the claimant would generally only agree to provide materials to third parties looking to complete “grant work” in so far as the claimant was the managing agent for those submissions. As such, if a party were seeking to obtain materials from the claimant, and in so far as it wished to submit “grant work”, it could generally only be doing so if it were going to be (or already was) submitting “grant work” through the claimant, [Robson 1, paras 7 to 9].[10]The Company in fact carried out CERT work until the scheme ended in 2012.[11]The Company continued to perform supplier work for the claimant, under the various government schemes from time to time. On 30 January 2013 the claimant and Company entered into an agreement headed the “Master agreement for the Supply of goods and services under the Green Deal and ECO Frameworks” (“the 2013 Agreement”), which the second defendant executed on behalf of the Company. The second defendant was not himself a party to the agreement.[12]In the 2013 Agreement, the claimant is referred to as “InstaGroup” and the Company as “Supplier”.[13]The purpose of the 2013 Agreement is set out in its recitals:
“Background (A) InstaGroup operate as a Green Deal provider under the Green Deal Framework Regulations of 2012 and related Codes of Practice. (B) On behalf of InstaGroup, the Supplier will be arranging surveys and/or installing a number of energy efficiency improvements for end users under the Green Deal Framework Regulations and shall be providing these services (including the supply of any related goods) in accordance with the terms of this agreement. (C) InstaGroup wishes the Supplier to provide goods and services subject to the terms and conditions of this agreement and the Supplier agrees to do so.”
[14]The relevant definitions are found in clause 1 of the 2013 Agreement: “Deliverables all Documents, products and materials developed or supplied by the Supplier or its agents, subcontractors, consultants and employees in relation to projects undertaken under the Green Deal Framework on behalf of InstaGroup; End User any natural person, body corporate, partnership or any representative of any of the same who enters into a Green Deal Plan; … Project the services to be performed by the Supplier as described in a Green Deal Plan; Services the services to be provided by the InstaGroup under the Green Deal Framework Regulations in accordance with this agreement, including any related goods which are to be supplied by the Supplier in connection with the Services” described in a Green Deal Plan;[15]The Company’s primary obligation under the 2013 Agreement is found in clause 2:
“2.1 The Supplier shall provide the Services to End Users on behalf of InstaGroup on the terms and conditions of this agreement.”
[16]Under clause 3, the Company was responsible for carrying out Energy Performance or Occupancy Assessment surveys on properties to determine whether the owner qualified for support under the Green Deal. If the owner qualified, the Company was then responsible for lodging the certificate that triggered the application for those works to be undertaken and funded.[17]Clause 4 contains the Company’s responsibilities as the Supplier under the 2013 Agreement. It includes (at 4.2.4) an obligation only to use goods purchased from the claimant or through a third party approved by the claimant.[18]Clause 5 provides that End Users pay the claimant for the services performed by the Company, and the claimant in turn pays the Company after deduction by the claimant of certain contractually specified charges (“Green Deal Supplier Charges”).[19]The 2013 Agreement included various clauses entitling the claimant to indemnities from the defendant, including:
“9. Indemnity 9.1 The Supplier shall indemnify and hold InstaGroup harmless from all claims and all direct, indirect or consequential liabilities (including loss of profits, loss of business, depletion of goodwill and similar losses), costs, proceedings, damages and expenses (including legal and other professional fees and expenses) awarded against, or incurred or paid by, the InstaGroup as a result of or in connection with any claim made against InstaGroup in respect of any liability, loss, damage, injury, cost or expense sustained by InstaGroup to the extent that such liability, loss, damage, injury, cost or expense was caused by, relates to or arises from the provision of the Services or the Deliverables as a consequence of a breach or negligent performance or failure or delay in performance of this agreement by the Supplier. 13. Remedies If any Services are not supplied in accordance with, or the Supplier fails to comply with, any terms of this agreement, the InstaGroup shall be entitled (without prejudice to any other right or remedy) to exercise any one or more of the following rights or remedies: … 13.1.2 … to require the immediate repayment by the Supplier of all sums previously paid by the InstaGroup to the Supplier under this agreement; …”
If any Services are not supplied in accordance with, or the Supplier fails to comply with, any terms of this agreement, the InstaGroup shall be entitled (without prejudice to any other right or remedy) to exercise any one or more of the following rights or remedies: … 13.1.2 … to require the immediate repayment by the Supplier of all sums previously paid by the InstaGroup to the Supplier under this agreement; …”[20]In the alternative, the claimant alleges an alternative agreement (“the Alternative Agreement”) with the same terms (mutatis mutandis) as the 2013 agreement, said to have been made by express oral agreement or to be implied from conduct.[21]The claimant alleges that the Company breached the 2013 Agreement (or the Alternative Agreement), including by committing various types of fraud. It claims against it:(1) £3,021,368.44 (being the total it was obliged to repay and did repay to 3 energy suppliers - “the Clawback Claims”), under clause 9.1, alternatively, an implied term in the 2013 agreement;(2) £2,502,408.09 (repayment of sums paid by it to the Company) under clause 13.1.2 of the 2013 Agreement;(3) £3,021,368.44, alternatively £2,502,408.09 as damages for breach of contract;(4) £2,502,408.09 as a payment to reverse unjust enrichment.[22]The claim against the second defendant is founded on the Guarantee and asserts that he is personally liable to the claimant in respect of the Clawback Claims.[23]The second defendant’s primary defence is that the Guarantee relates to sums due from the Company for goods supplied by the claimant on credit to it, and nothing more: para 9(c) of the Defence. He also seeks to rescind the Guarantee on the grounds of fraudulent or negligent misrepresentation, but that is not the subject of this application. Legal principles Summary judgment

Legal principles

[24]CPR 24.2 provides, so far as relevant:
“The court may give summary judgment against a claimant … on the whole of a claim or on an issue if— (a) it considers that the party has no real prospect of succeeding on the claim, … or issue; and (b) there is no other compelling reason why the case or issue should be disposed of at a trial.”
[25]A comprehensive summary of the principles emerging from the relevant caselaw was provided by Cockerill J in Daniels v Lloyds Bank [2018] EWHC 660 (Comm) [49], recently adopted by Nicklin J in Lawrence v Associated Newspapers [2023] EWHC 2789 (KB); [2024] 1 W.L.R. 3669 at [77]:
“(i) The burden of proof is on the applicant for summary judgment; (ii) The court must consider whether the claimant has a ‘realistic’ as opposed to a ‘fanciful’ prospect of success: Swain v Hillman [2001] 1 All ER 91; (iii) The criterion ‘real’ within CPR r 24.2(a) is not one of probability, it is the absence of reality: Lord Hobhouse of Woodborough in Three Rivers District Council v Bank of England (No 3) [2003] 2 AC 1, para 158; (iv) At the same time, a ‘realistic’ claim is one that carries some degree of conviction. This means a claim that is more than merely arguable: ED & F Man Liquid Products v Patel [2003] CP Rep 51, para 8; (v) The court must be astute to avoid the perils of a mini-trial but is not precluded from analysing the statements made by the party resisting the application for summary judgment and weighing them against contemporaneous documents (ibid); (vi) However disputed facts must generally be assumed in the claimant's favour: James-Bowen v Comr of Police of the Metropolis [2015] EWHC 1249 (QB) at [3]; (vii) An application for summary judgment is not appropriate to resolve a complex question of law and fact, the determination of which necessitates a trial of the issue having regard to all the evidence: Apovdedo NV v Collins [2008] EWHC 775 (Ch); (viii) If there is a short point of law or construction and, the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it: ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725; (ix) However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial. The court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] Lloyd's Rep PN 526; Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] FSR 3; …”

Construction

[26]It was common ground that general principles of construction are applicable to guarantees: National Merchant Buying Society Ltd v Bellamy and Mallett [2013]EWCA Civ 452[27]Those general principles are summarised in Marley v Rawlings [2015] AC 129 at [19] - [22]. At [19] Lord Neuberger said:
“… the court is concerned to find the intention of the party or parties, and it does this by identifying the meaning of the relevant words, (a) in light of (i) the natural and ordinary meaning of those words, (ii) the overall purpose of the document, (iii) any other provisions of the document, (iv) the facts known or assumed by the parties at the time that the document was executed, and (v) common sense, but, (b) ignoring subjective evidence of any party’s intentions.”
[28]The principles are expanded upon by Popplewell J in Lukoil Asia Pacific Pte Ltd v Ocean Tankers (Pte) Ltd (The “Ocean Neptune”) [2018] EWHC 163 (Comm), [2018] 1 Lloyd’s Rep. 654 in the following terms:
“The court’s task is to ascertain the objective meaning of the language which the parties have chosen in which to express their agreement. The court must consider the language used and ascertain what a reasonable person, that is a person who has all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract, would have understood the parties to have meant. The court must consider the contract as a whole and, depending on the nature, formality and quality of drafting of the contract, give more or less weight to elements of the wider context in reaching its view as to the objective meaning of the language used. If there are two possible constructions, the court is entitled to prefer the construction which is consistent with business common sense and to reject the other. Interpretation is a unitary exercise; in striking a balance between the indications given by the language and the implications of the competing constructions, the court must consider the quality of drafting of the clause and it must also be alive to the possibility that one side may have agreed to something which with hindsight did not serve his interest; similarly, the court must not lose sight of the possibility that a provision may be a negotiated compromise or that the negotiators were not able to agree more precise terms. This unitary exercise involves an iterative process by which each suggested interpretation is checked against the provisions of the contract and its commercial consequences are investigated. It does not matter whether the more detailed analysis commences with the factual background and the implications of rival constructions or a close examination of the relevant language in the contract, so long as the court balances the indications given by each.”
[29]In considering the construction of the Guarantee, I also bear in mind the “word of caution” expressed by the authors of Law of Guarantees (7th edn) at 4-001:
“Previous case law may give a very helpful indication of the approach which the court may take to a particular form of contract or the interpretation which may be given to certain words or phrases, but one must never lose sight of the fact that ultimately what has to be determined is the intention of the parties to the contract in question. Thus factors such as the context in which a phrase occurs, the wording of other parts of the contract and the factual matrix, may result in identical or similar wordings being given completely different interpretations in two different guarantees.”

Discharge of guarantor by material variation in contract between creditor and principal debtor

[30]Any material variation of the terms of the principal contract (i.e. between the creditor and the principal) will discharge the guarantor. This is known as the rule in Holme v Brunskill (1878) L.R. 3 Q.B.D. 495.[31]As to the meaning of “material variation”, the law is summarised in Law of Guarantees at 9-024 (citations omitted):
“A variation of the principal contract is material for the purposes of the rule in Holme v Brunskill where it is not necessarily beneficial to the surety or otherwise prejudices him, and where any lack of prejudice or benefit is not evident without enquiry. If the benefit or lack of prejudice is not self-evident, then the court will not embark on an enquiry as to whether the variation was indeed beneficial to the surety or otherwise unprejudicial. In Ankar Pty Ltd v National Westminster Finance (Australia) Ltd (1987) 162 C.L.R. 549 (at 559) the High Court of Australia formulated the rule as follows: “According to the English cases, the principle applies so as to discharge the surety when conduct on the part of the creditor has the effect of altering the surety’s rights, unless the alteration is unsubstantial and not prejudicial to the surety. The rule does not permit the courts to enquire into the effect of the alteration. The consequence is that, to hold the surety to its bargain, the creditor must show that the nature of the alteration can be beneficial to the surety only or that by its nature it cannot in any circumstances increase the surety’s risk.” “According to the English cases, the principle applies so as to discharge the surety when conduct on the part of the creditor has the effect of altering the surety’s rights, unless the alteration is unsubstantial and not prejudicial to the surety. The rule does not permit the courts to enquire into the effect of the alteration. The consequence is that, to hold the surety to its bargain, the creditor must show that the nature of the alteration can be beneficial to the surety only or that by its nature it cannot in any circumstances increase the surety’s risk.”
[32]The second defendant relied upon the decision of Triodos Bank NW v Dobbs [2005] EWCA Civ 630. However that decision concerned whether a guarantee to pay moneys due “under or pursuant to” a specified loan agreement, which entitled the creditor to agree to any amendment or variation of that agreement without reference to the guarantor, extended to sums due under a subsequent agreement made between the creditor and principal debtor.[33]The Guarantee in this case does not contain any such provisions, so in my judgment, the Triodos decision has no application in this case. Discussion and analysis Construction of the Guarantee

Discussion and analysis

[34]I start by considering the overall purpose of the 2008 Agreement. This is shown by its heading “Credit Account Application Form”. Its purpose was to enable the Company to obtain credit from the claimant for goods supplied by it to the Company in the amount of £8,000 per month. This purpose is confirmed by the consideration clause which sets out the consideration as being the claimant’s agreement to supply goods on credit as requested. The Guarantee was entered into in support of that purpose.[35]As to the specific wording of the agreement between the claimant and the Company, this provides that:(1) all transactions will be subject to the claimant’s Sale Conditions; and(2) the Company will make full settlement of all monies that are now or shall at any time in the future become due from the Company to the claimant howsoever arising.[36]In my judgment, the use of the expression “howsoever arising” is not sufficient of itself to extend the Company’s liability to transactions other than the supply of goods to which the credit agreement applied. In addition, the expression “all monies”, does not, as the extensive case law on that expression shows, have a fixed meaning and requires construction in accordance with the principles set out above. In construing these expressions, the court is entitled to take into account the heading of the 2008 Agreement, the consideration clause and the reference to the claimant’s Sale Conditions.[37]I also take into account that the 2008 Agreement is a short form, relatively informal document in a standard form to be used for all the claimant’s customers. By contrast, the 2013 Agreement is a detailed 32 page document containing carefully drafted provisions.[38]Turning to the factual matrix, the claimant’s counsel accepted in the course of the hearing that the court had it has before it all the evidence necessary for the proper determination of the question of construction. There is, therefore, no reasons for the court to decline to decide it.[39]The 2013 Agreement was not of course part of the factual matrix when the 2008 Agreement was entered into. However, in support of his submission that the Guarantee extends to liabilities under the 2013 Agreement, the claimant relied upon the fact when the Guarantee was entered into, the Company was acting as a supplier to the claimant in carrying out insulation works under the CERT scheme, and the purpose of supplying materials was for those works to be carried out.[40]The second defendant (rightly) accepted that for the purposes of this application, I must treat Robson 1 as true. However, as he submitted, the 2008 Agreement does not restrict the Company as to how it uses the goods supplied; nor does it refer to services. If the 2008 Agreement were to apply to liabilities arising from the Company’s supply of services to the claimant under the CERT scheme, it could have said so. It is also relevant that Robson 1 does not state or explain how such liabilities could arise. Unlike the 2008 Agreement, they would not arise in debt, since the claimant was the buying party; and the 2013 Agreement does not impose on the Company an obligation to buy goods from the claimant. In addition, there is no evidence that the CERT arrangements between the Company and the claimant contained contractual obligations equivalent to clauses 9 and 13.1.2 in the 2013 Agreement, which are relied upon by the claimant in this claim.[41]In my judgment, therefore, the Company’s obligations under the 2008 Agreement are limited to monies owing in respect of the supply of goods to it, and do not extend to financial liabilities arising out agreements for it to provide services to the claimant either in place at the time nor, even more so, entered into afterwards.[42]Turning the Guarantee itself, it is for all such sums as are now or shall in the future become due from the Company to the claimant. This is a reference back to the earlier part of the 2008 Agreement, and is to be construed consistently with it i.e. as sums due for the supply of goods. That construction is reinforced by the reference to interest at the rate specified in the claimant’s Conditions of Sale.[43]The Guarantee is expressed to be a continuing guarantee. The meaning of this expression is explained in Law of Guarantees at 4-017:
“A continuing guarantee is one which covers liabilities or transactions which continue to occur between the principal and creditor, such as the debts which fall due from time to time on a running account between a supplier of goods and a regular purchaser, or between a banker and its customer.”
[44]Thus, there is nothing in the use of the expression “continuing guarantee” that of itself extends the scope of the guarantee beyond the contractual relationship in respect of which it is entered into.[45]I now turn the authorities relied on by the parties. They are in my judgment illustrations of principle set out at paragraph 29 above that in each case the construction of a guarantee depends on the particular wording and other relevant factors as set out in Marley.[46]In National Bank of Nigeria Ltd v Awolesi [1964] 1 WLR 1311 the guarantor entered into a guarantee in respect of his nephew’s overdrawn account with the bank, “in consideration of the bank continuing the existing account with [the nephew]”. The guarantor agreed to make due payment to the bank of “all advances, overdrafts, liabilities, bills and promissory notes, whether made, incurred, or discounted before or after the date hereof”. The guarantee was expressed to be a continuing security.[47]The nephew’s original account remained overdrawn, but the bank allowed him to open 2 other accounts (“the new accounts”) into which he deposited (and then withdrew) monies. The bank then sought repayment of the outstanding debt on that original account.[48]It was held that the guarantee was to be construed narrowly as a guarantee of the account as it existed when the guarantee was given; and not therefore extending to the new accounts. The opening of those accounts was therefore an unauthorised departure from the terms of the guarantee resulting in its discharge.[49]This case demonstrates that a consideration clause can prevail over a more general description of liabilities, and this is unaffected by the guarantee being expressed as continuing security.[50]By contrast, in Bank of India v Transcontinental Commodity Merchants Ltd and Patel [1982] 1 Lloyd’s Rep. 506, affirmed [1983] 2 Lloyd’s Rep. 298, the consideration provided by the bank was itself widely expressed:
“making or continuing advances or otherwise giving credit or affording banking facilities”
. In addition, the language of the body of the guarantee was very wide and included sums owing the bank “on any account whatsoever”. It was held to be “deliberately drawn in the widest possible language so as to cover any liability of the company to the bank arising out of their mutual relations as bankers and customer, however that liability might arise and whether it arose out of what may be called a pure banking activity or not” liability of the company to the bank arising out of their mutual relations as bankers and customer, however that liability might arise and whether it arose out of what may be called a pure banking activity or not”

as bankers and customer, however that liability might arise and whether it

[51]The Court of Appeal held that there was no ambiguity in the body of the guarantee justifying recourse to the introductory words to resolve ambiguity; and that, in any event the transaction in respect of which the bank was seeking to enforce the guarantee (a foreign exchange transaction) was not excluded by the expression “banking facilities”.[52]The claimant’s counsel submitted, basing himself on Bank of India, that the Guarantee was not to be construed by reference to the consideration clause (or the heading) because the body of the guarantee is in wide, unfettered and unambiguous terms. For the reasons given above, I do not accept that submission.[53]I conclude that therefore that on the proper construction of the Guarantee, it is limited to the Company’s obligations for goods supplied to it by the claimant pursuant to the 2008 Agreement. It is not therefore necessary to consider whether the Guarantee was discharged by the 2013 Agreement.[54]If, however, I am wrong about that, and the Guarantee did extend to the Company’s liabilities under the CERT arrangements at the time, then in my judgment the Guarantee was discharged when the 2013 Agreement was entered into. If the 2013 Agreement was a variation of the CERT agreement, then the claimant has not shown it was beneficial to the second defendant or that it did not increase the risk to him. It would therefore have been a material variation which discharged the Guarantee.[55]However, the 2013 Agreement provides (at clause 19) that it supersedes all previous drafts, arrangements, understandings or agreements. On its own terms it is not a variation, but a new agreement. In those circumstances, the second defendant cannot in my judgment be in a worse position than if the 2013 Agreement were a variation. I am supported in this conclusion by the editors of Law of Guarantees at para 4-026:
“the discharge of the underlying agreement and its replacement by another agreement would ordinarily bring the surety’s obligations to an end”
. Although no authority is cited for this proposition, it is in my judgment plainly in accordance with the authorities considered above. Thus, equally on established principles, the Guarantee was discharged upon the Company and the claimant entering into the 2013 Agreement.[56]For the reasons given above, therefore, the second defendant’s application succeeds.