SCA 4530419653/2024
This case involved payments due and compensation under a contract. Issues included the use of performance guarantees. The award of related costs was also considered.
Background
The case concerned a commercial dispute arising from a construction contract between two contracting companies. The claimant sought payment of outstanding amounts totalling 1,795,214.00 Saudi riyals for services and work performed under the contract, as well as additional compensation of 2,000,000.00 riyals claimed under the same contract. The dispute primarily revolved around the validity of the claims, the timing of their submission, and the interpretation and application of contractual guarantees, specifically a performance guarantee or letter of guarantee. The claimant argued the defendant had not fulfilled its obligations under the contract and had failed to settle the financial entitlements for completed work, while the defendant contended that the claim was premature and raised issues on the proper execution and receipt of the guarantee documents.