Abraaj Investment Management Ltd. v Bregawn Jersey Ltd. [2010] EWHC 630 (Comm)

[2010] EWHC 630 (Comm)Case No 2009 FOLIO 1304Case No 2009 FOLIO 1305
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 25/03/2010
Before
MR. JUSTICE TEARE
Between
ABRAAJ INVESTMENT MANAGEMENTClaimantLIMITEDClaimantBREGAWN JERSEY LIMITEDDefendantABRAAJ INVESTMENT MANAGEMENT LIMITEDClaimantMR NEVILLE TULIDefendant
George McPherson (instructed by Allen & Overy LLP) for ClaimantHearing Hearing dates: 19 March 2010
Judgment

Mr. Justice Teare :

[1]This judgment stands as the judgment on applications for summary judgment in two related actions. The Defendants were represented until shortly before the hearing. Their former solicitors served notice that they were no longer acting for the Defendants and stated that Mr. Tuli would represent himself and Bregawn Jersey Limited (Bregawn). However, although he had notice of the hearing he did not attend it. The application was therefore heard in the absence of the Defendants though with notice to them.[2]The claims in both actions involve several agreements concerning an apparent aspiration by Mr. Tuli to invest in Indian, Persian and Islamic art. The Claimant, Abraaj Investment Management Limited (Abraaj), provided finance for the proposed venture and now, in substance, seeks the return of that finance. However, the structure of the agreements (apart from an initial loan) did not provide for the advance and repayment of a loan. It provided for a more complex arrangement whereby the artwork was to be purchased by Bregawn in the name of Abraaj, using funds provided by Abraaj, and then on-sold by Abraaj to an entity set up by Mr. Tuli, referred to in the relevant agreements as the India Asia Art Fund Limited (the Fund). In default of purchase by the Fund, the on-sale was to be to Bregawn and in default of sale to Bregawn the on-sale was to be to Mr. Tuli. The on-sale was the method by which Abraaj was intended to recover its funds. There has been no on-sale and so Abraaj has issued proceedings against Bregawn and Mr. Tuli to recover its funds.[3]It is first necessary to set out the material terms of the agreements in question.

The Initial Loan

[4]By two letters each dated 15 May 2008 Bregawn acknowledged receipt of US$1,000,000 from Abraaj and promised to repay US$1,200,000 on or before 1 August 2008.

The Purchasing Agency Agreement

[5]This was made between Bregawn and Abraaj and was dated 12 June 2008. In essence it provided for Bregawn to act as an agent of Abraaj in purchasing not more than US$19,000,000 worth of Indian, Persian and Islamic artwork. The agreement recited that Bregawn, as the Purchasing Agent had agreed to provide “the Purchasing Services” which were defined as the purchasing of the Artwork for and on behalf of Abraaj (referred to as the Seller) for further sale to the Fund (referred to as the Buyer). The most material terms stated as follows: “3. POWERS AND DUTIES OF THE PURCHASING AGENT(a) The Purchasing Agent has only those duties which are expressly specified in this Agreement.(b) The Purchasing Agent, acting as agent for the Seller, shall have and is hereby granted complete discretion, authority, power and right in the name of the Seller; (i) to enter into contractual arrangements with approved art dealers in order to assist it in performing the Purchasing Services and its other obligations under this Agreement; (ii) to enter into, make and perform all agreement and other undertakings as may in the reasonable opinion of the Purchasing Agent be necessary or advisable or incidental to the carrying out of the Purchasing Services pursuant to this Agreement; and (iii) to the extent necessary to enable it properly to exercise its rights and carry out its duties under this Agreement, to act for the Seller and on the Seller’s behalf in the same manner and with the same force and effect as the Seller might or could do.(c) Prior to the Completion Date, all costs, dues and expenses relating to the Artwork, including storage and insurance costs, shall be borne by the Purchasing Agent.(d) The Purchasing Agent shall, acting as agent for the Seller, invoice the Buyer in order to sell the Artwork to the Buyer, at a price equal to the aggregate of: (i) that paid by the Seller for the Artwork; (ii) handling and storage fees from the date the Artwork is purchased by the Purchasing Agent, acting for and on behalf of the Seller, until the Completion Date, at the rate of 20 per cent. per annum, or such other amount as agreed by the Seller and the Buyer; and (iii) any other charges payable by the Buyer or the Purchasing Agent to the Seller, without set-off or counterclaim and without any deduction. ……….. 5. PAYMENT (a) The Purchasing Agent undertakes to submit to the Seller an invoice relating to each piece of Artwork to be purchased in the name of the Seller. The Seller shall, within 5 Business Days, provide payment of the amount specified on such invoice to the Purchasing Agent. As soon as practicable, but no later than 2 Business Days following the purchase of the piece of Artwork by the Purchasing Agent on behalf of the Seller, the Purchasing Agent shall deliver to the Seller the original receipt naming “Abraaj Investment Management Limited”, or such other entity as directed by the Seller, as the purchaser of the Artwork and warranting the Seller as the legal owner with full, unencumbered, legal and binding title to such piece of Artwork. (b) The Purchasing Agent undertakes with the Seller that, if for any reason whatsoever the Buyer does not purchase the Artwork on the Completion Date in accordance with the terms and conditions of the Purchase Agreement (Buyer Default), that the Purchasing Agent shall immediately purchase the Artwork at the Purchase Price at the time of such Buyer Default, in accordance with the terms of the Purchase Agreement, as if the terms and conditions applicable therein to the Buyer, apply to the Purchasing Agent as of and from the time such Buyer Default occurs. (c) The Purchasing Agent shall agree with the Buyer any third party storage of the Artwork and shall arrange for the Artwork to be stored with the relevant third party, informing the Seller of such details. 6. INDEMNITY (a) The Purchasing Agent shall within 3 Business Days on written demand indemnify and keep indemnified and save harmless the Seller and their respective directors, officers, employees and duly appointed representatives (hereinafter individually and collectively referred to as the Indemnified Persons) on a full indemnity basis against any and all obligations, fees, taxes, liabilities, losses, costs, damages, penalties, demands, actions, judgments and expenses, including without limitation all legal fees and expenses (including, without limitation, such legal fees and expenses incurred in connection with the enforcement of this Agreement), of every kind and nature whatsoever imposed on, incurred by, or asserted against any of the Indemnified Persons arising out of any failure, default or breach of, or by, the Purchasing Agent in performing, or omitting to perform, any of its obligations hereunder.” (i) to enter into contractual arrangements with approved art dealers in order to assist it in performing the Purchasing Services and its other obligations under this Agreement; (ii) to enter into, make and perform all agreement and other undertakings as may in the reasonable opinion of the Purchasing Agent be necessary or advisable or incidental to the carrying out of the Purchasing Services pursuant to this Agreement; and (iii) to the extent necessary to enable it properly to exercise its rights and carry out its duties under this Agreement, to act for the Seller and on the Seller’s behalf in the same manner and with the same force and effect as the Seller might or could do. (ii) handling and storage fees from the date the Artwork is purchased by the Purchasing Agent, acting for and on behalf of the Seller, until the Completion Date, at the rate of 20 per cent. per annum, or such other amount as agreed by the Seller and the Buyer; and (iii) any other charges payable by the Buyer or the Purchasing Agent to the Seller, without set-off or counterclaim and without any deduction.

The Purchase Agreement

[6]This was made between Abraaj and the Fund and was also dated 12 June 2008. In essence it provided that the Fund would purchase from Abraaj the artwork which Bregawn had purchased on behalf of Abraaj. The most material terms stated as follows:
“2. Sale and Purchase The Seller undertakes to sell all of the Artwork to the Buyer and the Buyer undertakes to purchase all of the Artwork from the Seller on the terms and conditions contained in this Agreement. 3. Completion Date The sale of all of the Artwork from the Seller to the Buyer shall take place no later than 31 August 2008 or, subject to the prior written approval of the Seller, any later date (but no later than 30 days) agreed between the Buyer and the Seller (the Completion Date) and the Purchase Price (as defined in Clause 4 (Payment) shall be paid in accordance with Clause 4 (Payment) below no later than the Completion Date. 4. Payment The purchase price (the Purchase Price) to be paid by the Buyer for the Artwork will be: (a) payable on the Completion Date; (b) payable to such account as notified by the Seller to the Buyer; and (c) an amount equal to that invoiced, for all of the Artwork, by the Seller or Bregawn Jersey Limited, acting in its capacity as purchasing agent, for and on behalf of the Seller. To the extent that the Buyer is compelled to make any deductions for any reason, it will pay additional amounts to ensure receipt by the Seller of the full amount which the Seller would nave received but for the deduction.”

The personal guarantee

[7]Mr. Tuli provided a guarantee (dated June 2008) to Abraaj of the obligations of the Fund and Bregawn in the following terms:
“1. PERSONAL GUARANTEE AND INDEMNITY The Personal Guarantor irrevocably and unconditionally: (a) guarantees to the Lender punctual performance by each of the Buyer and the Purchasing Agent, as applicable, of all its obligations under the Agreements; (b) undertakes with the Lender that, whenever the Buyer or the Purchasing Agent, as applicable, does not pay any amount when due under or in connection with the Agreements, the Personal Guarantor must immediately on demand by the Lender, pay that amount (in the currency in which it is due) as if it was the principal obligor in respect of that amount; (c) undertakes with the Lender that, if for any reason whatsoever the Purchasing Agent does not purchase the Artwork in accordance with the terms and conditions of the Purchasing Agency Agreement in the event of a Buyer Default, that the Personal Guarantor shall immediately purchase the Artwork at the Purchase Price at the time of such Buyer Default, in accordance with the terms of the Purchase Agreement as if the terms and conditions applicable to the Buyer, apply to the Personal Guarantor, as of and from the time such Buyer Default occurs; (d) agrees with the Lender that if, for any reason, any amount claimed by the Lender under this Clause is not recoverable from the Personal Guarantor on the basis of a Personal Guarantee, then the Personal Guarantor will be liable as a principal debtor and primary obligator to indemnify the Lender in respect of any loss it incurs as a result of the Buyer or the Purchasing Agent, as applicable, failing to pay any amount expressed to be payable by it under the Agreements on the date when it ought to have been paid. The amount payable by the Personal Guarantor under this indemnity will not exceed the amount it would have had to pay under this Clause had the amount claimed been recoverable on the basis of a Personal Guarantee. (e) agrees with the Lender that it shall within 3 Business Days on written demand indemnify and keep indemnified and save harmless the Lender and their respective directors, officers, employees and duly appointed representatives (hereinafter individually and collectively referred to as the Indemnified Persons) on a full indemnity basis against any and all obligations, fees, taxes, liabilities, losses, costs, damages, penalties, demands, actions, judgements and expenses, including without limitation all legal fees and expenses (including, without limitation, such legal fees and expenses incurred in connection with the enforcement of the Agreements), of every kind and nature whatsoever imposed on, incurred by, or asserted against any of the Indemnified Persons arising out of any failure, default or breach of, or by, the Personal Guarantor in performing, or omitting to perform, any of its obligations hereunder…”
The Personal Guarantor irrevocably and unconditionally:

The Amendment Agreement

[8]This was made between Abraaj, Bregawn and the Fund and was dated 26 August 2010. The most material terms were as follows. “(c) The Agreements will be amended as follows:(a) (A) With respect to the definition of “Artwork” in clause 1(a) of the Purchasing Agency Agreement, the reference to “US$ 19,000,000” shall be replaced with “US$ 23,700,000”. For the avoidance of doubt, the revised figure of US$23,700,000 comprises the existing loan of US$19,000,000, settlement of the US$1,000,000 loan under the Loan Letter of a total US$1,200,000 and a further available loan amount up to a maximum US$3,500,000.(b) (B) Existing clause 3 of the Purchase Agreement shall be deleted, and replaced with the following:
“3. Completion Date The sale of all of the Artwork from the Seller to the Buyer shall take place on the earlier of: (a) 15 October, 2008; and (b) the Initial or First Closing Date of the Buyer, or any later date as may be agreed in writing by the Seller (the “Completion Date”). The Purchase Price (as defined in Clause 4 (Payment)) shall be paid in accordance with Clause 4 (Payment) below no later than the Completion Date.” 4. Cancellation of Loan Letter As of the Effective Date, the Loan Letter shall be deemed to be cancelled in full, and shall no longer be in force nor effect from such date.” (A) With respect to the definition of “Artwork” in clause 1(a) of the Purchasing Agency Agreement, the reference to “US$ 19,000,000” shall be replaced with “US$ 23,700,000”
. For the avoidance of doubt, the revised figure of US$23,700,000 comprises the existing loan of US$19,000,000, settlement of the US$1,000,000 loan under the Loan Letter of a total US$1,200,000 and a further available loan amount up to a maximum US$3,500,000. (B) Existing clause 3 of the Purchase Agreement shall be deleted, and replaced with the following:
“3. Completion Date The sale of all of the Artwork from the Seller to the Buyer shall take place on the earlier of: (a) 15 October, 2008; and (b) the Initial or First Closing Date of the Buyer, or any later date as may be agreed in writing by the Seller (the “Completion Date”). The Purchase Price (as defined in Clause 4 (Payment)) shall be paid in accordance with Clause 4 (Payment) below no later than the Completion Date.”

The Facts

[9]It appears that before the agreements were signed Bregawn, presumably in anticipation of the funding contemplated by them, began purchasing works of art and issuing invoices for payment by Abraaj. By 6 August 2008 Abraaj had advanced US$19,000,000. After the Amendment Agreement was signed further invoices were issued and in response further funds were advanced. By 2 September 2008 a further US$3,490,000 had been advanced.[10]Before these proceedings were commenced Abraaj, by letter dated 17 September 2009 from its solicitor Allen & Overy, referred to the funds totalling US$22,490,300 which had been advanced and invited Bregawn to respond to its complaint that Bregawn had failed to invoice the Fund, that the Fund had failed to purchase the artwork, that Bregawn, in default of purchase by the Fund, had failed to purchase the artwork and that as a result Abraaj had suffered loss.[11]By letter dated 7 October 2009 Bregawn said:
“Unfortunately, because of the actions of Christie’s and Sotheby’s, the Artworks purchased for Abraaj by Bregawn have not been taken full physical possession of, and hence the terms of handing over full title to Abraaj has remained incomplete. We sincerely regret this position. …………… Further, in this regard, Mr.Tuli acting on behalf of Osian’s Connoisseurs of Art Private Limited (Osian’s) has offered both Sotheby’s and Christie’s a proposal in which the unpaid artworks, purchased by Bregawn for the IAAAF, will be purchased by Osian’s and/or its Clients in a private treatise agreement provided that the artworks owned by Abraaj are handed over to Abraaj and sufficient time is provided to Osian’s and/or Clients so as to make these purchases. ……………IAAAF, not having raised its required corpus, did not take off, and hence invoicing it would have served no purpose.”
[12]The letter does not dispute the sums which had been advanced. Nor does there appear to be any dispute that Bregawn did not invoice the Fund as it had promised to do. Further, Bregawn stated that the auctioneers had not been paid in respect of artworks purchased at their auctions. The inescapable conclusion is that the sums advanced to Bregawn by Abraaj have not been passed on to the auctioneers. If the monies had been passed on there would have been no need to make alternative proposals to the auctioneers and the artworks would not have been described as “unpaid”. What has happened to the very substantial funds advanced by Abraaj to Bregawn is not stated by Bregawn and so is unknown.[13]The Fund did not purchase the artwork from Abraaj by 15 October 2008.[14]Abraaj has also alleged that, although the artwork was purchased at auction (though not paid for), it was not purchased in Abraaj’s name. This allegation is based upon correspondence between Bregawn and the auctioneers in which Bregawn state that the artwork “currently retained by you and held to our order, listed on the enclosed appendix ….have been sold to [Abraaj].” It is suggested that the words “sold to Abraaj” mean “on-sold to Abraaj”.[15]Bregawn has denied this allegation (in its letter dated 7 October 2009). I am not satisfied on this Part 24 application that the correspondence must necessarily be interpreted in the manner suggested by Abraaj. That correspondence (including the reference in the appendix to Abraaj as the buyer’s name) is at least open to the interpretation that the artwork was purchased by Bregawn without disclosing the name of the purchaser, which name was then disclosed in the correspondence. I am therefore not satisfied on this Part 24 application that such purchases as were made at auction by Bregawn were not made on behalf of Abraaj. Bregawn may have made the purchase without disclosing its principal at the time of purchase. I am not satisfied that so doing was a breach of the Purchasing Agency Agreement.[16]In fact some artwork has been delivered up to Abraaj. Mr. Watson of Allen & Overy, Abraaj’s solicitors, has stated that Bregawn has “delivered up” to Abraaj certain artwork purchased for an amount estimated to be $8,675,9000. He added that Abraaj considers the present market value of that artwork to be significantly less than that price.[17]Arising out of these events Abraaj advances several causes of action. I shall first deal with the claims against Bregawn.

The price

[18]When the application for summary judgment was opened Mr. George McPherson, on behalf of Abraaj, submitted that Abraaj had a claim in debt against Bregawn, namely, the price payable by Bregawn on purchasing the artwork from Abraaj in circumstances where the Fund had failed to purchase the artwork.[19]I do not consider that Abraaj is in a position to make such a claim. Delivery of the goods and payment of the price are concurrent conditions, unless otherwise agreed; see section 28 of the Sale of Goods Act 1979. It was not suggested that it was otherwise agreed. Since Abraaj is not able to deliver the goods, and has not offered to do so, it cannot establish a right to payment of the price. Repayment of a loan in the sum of $1.2m.[20]The loan agreement dated 15 May 2008 requiring repayment in the sum of US$1.2m on or before 30 August 2008 was cancelled by the Amendment Agreement dated 26 August 2008. The sum of $1.2m. was instead included in the sum of $23.7m referred to in clause 3(c)(A) of the Amendment Agreement. It seems to me that the effect of that agreement was that the parties anticipated that when the Fund, alternatively Bregawn, repurchased the artwork from Abraaj the aggregate purchase price would be $23.7m and would include the sum of $1.2m. However, since Abraaj is unable to maintain an action for the price, that remedy is not available.[21]Mr. McPherson submitted that in any event and pursuant to clause 4(c) of the Purchasing Agreement the sum of $1.2m. would not be payable because it had not been “invoiced” to the Fund pursuant to clause 3(d) of the Purchasing Agency Agreement. He submitted that in those circumstances there should be an implied term to the effect the loan was repayable on the revised completion date of 15 October 2008.[22]I am not able to accept that argument. The loan agreement was cancelled by mutual agreement. It was envisaged that the sum of $1.2m. would nevertheless be repaid by the Fund, alternatively Bregawn, paying that sum as part of the purchase price of the artwork from Abraaj. Bregawn was bound to invoice the Fund in respect of that sum pursuant to clause 3(d)(iii) of the Purchasing Agency Agreement as “any other charge payable by the Buyer or the Purchasing Agent to the Seller”. If, as admitted, Bregawn failed to apply the funds advanced to it by Abraaj for the purchase of artwork, Bregawn acted in breach of the Purchasing Agency Agreement for it failed to provide “the Purchasing Services”. It thereby disabled Abraaj from being able to sell the artwork to the Fund, alternatively Bregawn, and thereby recover the sum of $1.2m. The damages recoverable for that breach would in principle, it seems to me, include the non-payment of the sum of $1.2m together with non-payment of the other sums advanced to Bregawn and expected to repaid as part of the price payable on sale of the artwork by Abraaj. I therefore do not accept that there is any business necessity to imply the term suggested by Abraaj to enable the sum of $1.2m. to be recovered as a debt. There is an adequate remedy in damages.[23]I will therefore give judgment in damages for breach of Bregawn’s failure to provide “the Purchasing Services”, such damages to be assessed. Account will have to taken of the value of artwork delivered up to Abraaj. I am satisfied that there is no real prospect of a defence to that claim or any other compelling reason for a trial.

Indemnity pursuant to clause 6(a) of the Purchasing Agency Agreement

(a) of the Purchasing Agency Agreement

[24]Clause 6(a) of the Purchasing Agency Agreement obliges Bregawn to indemnify Abraaj against all losses arising out of any breach by Bregawn in performing its obligations under that agreement. In circumstances where Bregawn has received funds from Abraaj for the purchase of artwork and has not applied them in the purchase of artwork there has been a breach by Bregawn to “provide the Purchasing Services” that is, to purchase the Artwork for and on behalf of Abraaj. This contractual right to an indemnity will cover much the same ground, perhaps all of the same ground, as the common law right to damages.[25]The obligation to indemnify arises within 3 business days of a written demand. The letter dated 17 September 2009 from Allen & Overy complained that Bregawn had not purchased the artwork in the name of Abraaj and that neither the Fund nor Bregawn had purchased the artwork from Abraaj. Allen & Overy said that Abraaj had suffered loss as a result and called upon Bregawn to resolve the claim failing which proceedings would be commenced. I regard the letter dated 17 September 2009 as a sufficient written demand for the purposes of clause 6(a).[26]I am satisfied that there is no real prospect of a defence to this claim and that there is no other compelling reason for a trial. However, the quantum of Abraaj’s losses must be assessed at a subsequent hearing because credit will have to be given for the value of the artwork delivered up to it.

Breach of fiduciary duty and breach of trust

[27]As an agent Bregawn had certain duties as a fiduciary, in particular, to act in good faith in the interests of Abraaj. On the basis of its own admissions Bregawn has not applied the funds it has received from Abraaj to payment of the artwork. It has not stated what it has done with those funds. There therefore appears to be no real prospect of a defence to the claim for breach of fiduciary duty.[28]The sums advanced to Bregawn by Abraaj were advanced for a particular purpose, namely, the acquisition of artwork. On the basis of the same admission there appears to be no defence to the claim for breach of that trust.[29]Judgment in respect of these heads of claim should therefore be given since there is no other compelling reason for a trial.[30]The equitable compensation payable for such breach of duty and trust will have to be assessed at a further hearing to take account, in particular, of the value of artwork delivered up to Abraaj.[31]Since it is not known what has happened to the funds advanced by Bregawn to Abraaj, Bregawn must also account for those funds and for any profit obtained as a result of its breach of duty and trust.[32]Since these claims arise out of illegitimate use of Abraaj’s own funds Abraaj is also entitled to a declaration that it is entitled to trace its monies into any asset purchased by Bregawn using those funds. If and when such assets are identified a further order specific to such assets will be required.

Restitution

[33]This claim is put on the basis that Bregawn has been unjustly enriched at the expense of Abraaj. It is clear that Bregawn has been enriched at the expense of Abraaj. In order to show that it would be unjust to retain that benefit Mr. McPherson accepts that he must show that the consideration for the payment of Abraaj’s funds has wholly failed. There is a difficulty in showing that in circumstances where some artwork has been delivered up. That suggests that the consideration has not wholly failed. Mr. McPherson submitted that this is only a problem where the claimant can no longer restore the benefit he has received from partial performance of the contract; see Goff and Jones, The Law of Restitution 7th.ed.paragraph 1-054. However, I am not satisfied that Bregawn has no real prospect of defending this claim in circumstances where the benefit received from partial performance has not been restored to Bregawn. I therefore do not give judgment for the claim in restitution. There must be a trial of that claim.[34]Mr. McPherson sought an order for compound interest pursuant to the court’s equitable jurisdiction. I consider that all matters relating to interest should be determined when Abraaj obtains a money judgment.[35]Mr. McPherson also sought costs on an indemnity basis pursuant to clause 6(a) of the Purchasing Agency Agreement. I agree that that is appropriate since that clause expressly refers to an indemnity “on a full indemnity basis”.

The claim against Mr. Tuli under the Personal Guarantee

[36]By the end of the oral argument Mr. McPherson sought judgment against Mr. Tuli pursuant to clauses 1(a) and (e) only of the Guarantee.[37]By clause 1(a) of the Personal Guarantee Mr. Tuli guaranteed, inter alia, punctual performance by Bregawn of its obligations under the Purchasing Agency Agreement. He is in breach of that obligation because Bregawn has failed to purchase the artwork by failing to pay the price to the auctioneer for all of the artwork which it bid for. I am satisfied that there is no real prospect of a defence to that claim and that there is no other compelling reason for a trial. I will therefore give judgment for damages to be assessed. Account will have to be taken of the value of the artwork which has been delivered up to Abraaj.[38]By clause 1(e) of the Personal Guarantee Mr. Tuli agreed to indemnify Abraaj in respect of its losses caused by a breach by the Guarantor of its obligations. The clause requires a written demand. The written demand dated 17 September 2009 called upon Mr. Tuli to purchase the artwork (pursuant to clause 1(c) of the guarantee, an obligation no longer relied upon in this application) or, alternatively, “to pay those amounts due in connection with the Agreements in order to secure the release of the Artwork currently held by auction houses so that the subsequent sale of the Artwork to IAAAF/Bregawn/you may proceed.” This latter demand requires Mr. Tuli to honour his obligation in clause 1(a) of the Guarantee. It does not expressly demand payment of the losses caused by the breach of that obligation but I accept that it is a sufficient demand for the purposes of clause 1(e).[39]There is no defence to a claim under clause 1(e) with a real prospect of success and there is no other compelling reason for a trial. I will therefore give judgment for an indemnity under clause 1(e) with damages to be assessed.[40]Matters of interest should await a money judgment but Abraaj is entitled to costs on an indemnity basis pursuant to clause 1(e) of the guarantee.[41]I shall ask counsel to prepare a draft order in each action giving effect to this judgment.