Court rejects authority challenge on £3.5M indemnity
The High Court handed down a judgment on October 27, 2026, finding a cross-company indemnity validly executed and ordering Shapoorji Pallonji Mideast LLC to pay the full £3.5 million cap to Ion Surety Company S.A. The dispute followed the winding up of a UK subsidiary, Shapoorji Pallonji UK Limited, in August 2023, after which Ion Insurance Company Inc settled a project bond claim for £3,657,684.29.
Validation of upfront due diligence for surety providers
SPME had argued that the signatory who signed the indemnity in May 2020 lacked formal written authority under Dubai law, creating what its counsel described as a 'black hole'. The Technology and Construction Court rejected the defence, ruling that a chain of delegated authority existed and that SPME had held the signatory out as authorized. The court noted that Ion had collected founding documents, financial statements, and a board resolution before releasing the bond, validating the surety's upfront due diligence.