URC522 - Article No.21

[Chi-Wing,VincentWan]

Re :ARTICLE 21 CHARGES AND EXPENSES

Would like to have some point of views to the interpretation of charges and expense of above article.

Recently, I have encountered an argument with banks. In my collection order I have instructed the collecting bank to collect all charges from drawee and must not be waived. However, the proceeds were received with less amount. After clarify with the collecting bank, they informed that my collection order never said expenses are also for account of drawee. So their expenses are for drawer's account. I was astonished by their interpretation. I argue that they are using terminology terms to alter my instructions. It is because I have already an intention to collect the payment in full amount. They cannot by changing the charges to read as "handling expenses / commission' and whatever.

Anybody support my viewpoint?
Is there any distinguish between charges and expenses?
Am I need to incorporate some words in the collection order to aviod future disputes?

[JudithAutié]

I can see that no one has jumped to answer your inquiry rapidly – and I suspect that it is because it’s certainly not that evident.

In my opinion and without any responsibility, I do think that the collecting bank is not acting in good faith as Article 9 of the URC522 requires.

Be that as it may, I would suggest that expenses mean costs disbursed or incurred in relation to the collection whereas charges would cover the price billed for handling the collection. Therefore in my mind the collecting bank should be able to produce vouchers to prove the expenses that were incurred or disbursed, and not just their own bill for “handling and commissions”

Good luck
Judith