Even if a financier held a bank guarantee on constructive trust, the mere holding of the guarantee does not give rise to an obligation on the part of the financier to take steps to bring into existence other property that would then be impressed with a trust, such as by drawing down on its customer's facility.
A financier who accepts delivery of and retains custody of a bank guarantee provided as substitute security under a building contract does not thereby become a trustee de son tort of the retention moneys trust, and the equitable maxim that equity regards as done that which ought to be done cannot be invoked to treat retention moneys as having been set aside on trust where no funds were ever appropriated. The maxim operates only where the agreement is specifically enforceable and cannot be used as a substitute for transparent legal reasoning. A promisor is not to be regarded as 'controlling' the chose in action constituted by its own contractual promise so as to become a trustee de son tort.
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Judicial Consideration (Chronological)