Mexico Infrastructure Finance LLC v Corporation of Hamilton

Guarantee – Power to grant guarantee. The respondent Corporation of Hamilton's grant of a guarantee to support a loan borrowed by a private developer in connection with the development of a car park was ultra vires and unenforceable, because it was not for a 'municipal purpose' within the true meaning of s 23(1)(f) of the Municipalities Act 1923 of Bermuda. The Privy Council , in dismissing the guarantor's appeal, held that the word 'municipal' in s 23(1)(f) meant that a purpose had to be aimed at the provision, by the Corporation, of a service for the benefit of inhabitants of Hamilton and that the guarantee was not capable of being brought within the scope of the Corporation's powers in that regard.

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