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Copyright © International Chamber of Commerce (ICC). All rights reserved. ( Source of the document: ICC Digital Library )
1999 LC CASE SUMMARIES No. 97-6430, 1999 U.S. App. LEXIS 27338 (10th Cir. 26 October 1999)
Topics:
Article
Bankruptcy; Voidable Preference; New Value to Antecedent Debt
Note: In an action by a bankruptcy trustee against an issuing bank to avoid as preferential a payment under a standby letter of credit to bonding companies to cover premiums and collateral payments for the account of the applicant for required reclamation performance bonds, the U.S. Court of Appeals for the 10 th Circuit affirmed a grant of summary judgment in favor of the issuing bank by the U.S. District Court for the Western District of Oklahoma. The court noted that although the credit was issued to pay an antecedent debt of the applicant and, thus, may constitute a preference for the beneficiary, the issuer did give new value for the credit and did not receive a voidable preferred payment by realizing on the collateral it received for issuance of the standby.
©2000 INSTITUTE OF INTERNATIONAL BANKING LAW & PRACTICE
COPYRIGHT OF THE INSTITUTE OF INTERNATIONAL BANKING LAW & PRACTICE
The views expressed in this Case Summary are those of the Institute of International Banking Law and Practice and not necessarily those of ICC or the other partners in DC-PRO.