JKB stores (‘JKB’) is a franchisee of Zike International (‘Zike’). Under their franchise agreement, JKB has provided Zike with a bank guarantee of rupees 2,000,000 issued in favour of Zike by Friendly Bank (‘Bank’). Since then the following events have occurred:(a) JKB has defaulted and Zike has requested the Bank for the encashment of the guarantee in its favour.(b) The Bank has refused on the ground that it did not receive any consideration from Zike for providing the guarantee, therefore, Zike should approach JKB.Required:Analyse the situation from the perspective of contract law and advise Zike as to its future course of action. (10 marks)
