Parties

Initiator: Company T (the "Initiator")

Respondent 1: Bank C (the "First Respondent")

Respondent 2: Bank U (the "Second Respondent")

Issues

1. Whether the First Respondent, acting as issuing bank, should be held liable towards the Initiator, acting as beneficiary, for instructing the Second Respondent, acting as negotiating bank, to cease negotiation as a result of two attachment orders delivered against the First Respondent;

2. Whether the Second Respondent, acting as negotiating bank, should be held liable towards the Initiator, acting as beneficiary, for having suspended negotiation in compliance with the instructions sent by the First Respondent.

The Initiator claimed that its loss due to the temporary suspension of negotiation amounts to USD 1,782,633 plus interest (not determined).

Documentation

- Request by the Initiator dated 22 September 2003 to ICC International Centre for Expertise, Paris, requesting a DOCDEX Decision.

- Answer by the First Respondent, acting through its attorneys based in Country F, dated 16 December 2003, addressed to ICC International Centre for Expertise, Paris, received by the Centre on 16 December 2003, requesting a DOCDEX Decision and underlining the non-binding character of such decision.

- No answer was submitted by the Second Respondent.

- Copy of the Applicant's order of the consignment addressed on 19 March 1997 to the Initiator, copy supplied by the Initiator.

- Copy of documentary credits No. 123456 dated 2 February 1998 and No. 78910 dated 26 March 1997 issued by the First Respondent upon the instruction of Company H, Country F (the "Applicant") in favour of the Initiator for an amount of respectively USD 500,000 and USD 1,000,000, both available by negotiation (the "documentary credits"), copies supplied by both the Initiator and the First Respondent.

- Copy of drafts drawn under the documentary credits, copy supplied by the First Respondent.

- Copy of two messages addressed by the First Respondent to the Applicant listing the discrepancies found in the documents presented by the Initiator and transmitted by the Second Respondent, copy supplied by the First Respondent. The discrepancies are irrelevant for the purpose of this DOCDEX case as, first, they were waived by the Applicant and second, they are not referred to in the Request.

- Copy of a first notice of attachment notified by bailiff to the First Respondent, dated 23 April 1998, freezing the sums due to the Initiator under the documentary credits, copy supplied by the First Respondent.

- Copy of a second notice of attachment notified by bailiff to the First Respondent, dated 14 May 1998, freezing the sums due to the Initiator under the documentary credits, copy supplied by the First Respondent.

- Copy of a SWIFT message dated 15 May 1998 sent by the First Respondent to the Second Respondent informing it of the attachments and instructing it to cease further negotiation under the documentary credits, copy supplied by the Initiator and the First Respondent.

- Copy of a decision rendered by the commercial court of City R, Country F on 25 May 1998 discharging the attachments and rendering the documentary credits available again for negotiation, copy supplied by the First Respondent.

- Copy of a SWIFT message dated 5 July 1999 addressed by the First Respondent to the Second Respondent concerning an 11th presentation under the documentary credits, copy supplied by the First Respondent. The ground for the dispute under this 11th presentation is unclear, although the First Respondent refers to fraud. Whether or not the 11th presentation is fraudulent, it should be considered outside the scope of this DOCDEX case, as the Initiator does not refer to that specific presentation in the Request.

- Copy of a claim filed by the Initiator with the commercial court of City R, Country F against the Applicant, copy supplied by the First Respondent which indicated that the proceeding is currently pending.

Issues

1. Whether the First Respondent, acting as issuing bank, should be held liable towards the Initiator, acting as beneficiary, for instructing the Second Respondent, acting as negotiating bank, to cease negotiation as a result of the attachment orders delivered against the First Respondent by the commercial court in City R, Country F.

According to ICC DOCDEX Rules, ICC Publication No.811, Article 1, "[DOCDEX] is available in connection with any dispute related to a documentary credit incorporating the ICC Uniform Customs and Practice for Documentary Credits (UCP), and the application of the UCP ... Its objective is to provide an independent, impartial and prompt expert decision (DOCDEX Decision) on how the dispute should be resolved on the basis of the terms and conditions of the documentary credit ... and the applicable ICC Rules."

Whether or not a bank having issued an irrevocable documentary credit has the duty to comply with a court-ordered attachment prohibiting it from making payment under the documentary credit is a matter not covered in the UCP. Accordingly, the liability of the First Respondent for having complied with the attachment orders and having instructed the Second Respondent to cease negotiation in compliance with attachment orders delivered by a court of law is an issue which is outside the UCP and has instead to be determined by a court of law acting according to the applicable law.

2. Whether the Second Respondent, acting as negotiating bank, should be held liable towards the Initiator, acting as beneficiary, for having suspended negotiation in compliance with the instructions sent by the First Respondent.

For the reasons indicated under the first issue above, and absent any confirmation by the Second Respondent of the documentary credits, the liability of the Second Respondent towards the Initiator is a matter not covered by the UCP either and has to be determined by a court of law acting according to the applicable law.

Decision

This Panel unanimously decides to reject the Initiator's Request because all the issues identified in the Request are outside the scope of ICC DOCDEX Rules.