For refusal of the contractor to replace the expired Bank guarantee it is possible to collect the penalty
The company has overdue delivery of works under the contract. By that time, the Bank guarantee that ensured the execution of the contract had expired. For failure to provide new security, the customer demanded a penalty, the court supported him. The delay in performance of works arose due to the fault of the contractor. Under the terms of the contract, he had to replace the collateral within 10 working days.
Recall, from July 1, the contract should be a condition to replace the Bank guarantee, if the Bank revoked the license. The obligation arises after the customer has notified the supplier of the need to provide security. The replacement is given a month from the date of notification. For non-compliance with the deadline, penalties are charged as for late performance of obligations.
Document: Resolution of the Arbitration court of the North-Western district of 24.09.2019 in the case N A56-141584/2018