From our involvement in DC disputes on discrepancies around the world, we often meet this problem, whether to determine discrepancies solely on the face of the documents or to speculate the intentions of the Applicant in his special instructions in the DC.
In fact, the backbone doctrines of document examination are reflected by Articles 13 and 14 of the UCP 500. However, what bankers understand and how they behave are two different matters.
Members' inputs are welcome.
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Should a document examiner speculate the intentions of the A
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larryBacon
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Should a document examiner speculate the intentions of the A
In theory, DC checkers should be able to determine discrepancies on the basis of documents presented. However, in practice, DCs are often advised without careful examination by the issuing bank, advising bank and beneficiary. Experience has taught me to respect Murphy's Law and this has particular relevance to wording in DCs which may be interpreted in more than one way.
Sometimes you cannot allow for ridiculous interpretations such as happened to me some years ago when an Irish nominated bank refused to accept a C/O showing "Ireland" in a box titled "Origin", because the DC required "Irish origin". Thankfully this has since been resolved by an official opinion. Even so, one should examine DCs from the viewpoint of the "Devils' Advocate"! If it can be misinterpreted, chances are that it will be.
Only in circumstances where there is a multiplicity of interpretations should a DC checker contemplate the intention of the applicant. However, if documents have been presented, he does not have the luxury of seeking the opinion of the applicant at that time. If, however, before advising the DC, he requested clarification, the problem may be "nipped in the bud".
Laurence
Sometimes you cannot allow for ridiculous interpretations such as happened to me some years ago when an Irish nominated bank refused to accept a C/O showing "Ireland" in a box titled "Origin", because the DC required "Irish origin". Thankfully this has since been resolved by an official opinion. Even so, one should examine DCs from the viewpoint of the "Devils' Advocate"! If it can be misinterpreted, chances are that it will be.
Only in circumstances where there is a multiplicity of interpretations should a DC checker contemplate the intention of the applicant. However, if documents have been presented, he does not have the luxury of seeking the opinion of the applicant at that time. If, however, before advising the DC, he requested clarification, the problem may be "nipped in the bud".
Laurence