1) Does an insurance document need to identify the company name of the countersigning party or is an unidentified signature acceptable? (Sometimes these documents are countersigned by the beneficiary, a forwarder or an agent/broker. It cannot be determined.) The question relates to cases where the certificate is on the insurance company's letterhead with their pre-printed signature and an indication for a countersignature. That request may or may not be accompanied by the phrase "not valid unless countersigned by a duly authorized representative of the company or the assured". Can one deduct from article 34 that it needs to be identified?
2) the credit required "insurance policy/certificate in one original". The beneficiary presented a certificate headed "original" and another headed "duplicate" both originally signed. The insurance document made no reference to the number of originals issued. Surely the simplest solution would be to not accept the copy headed "duplicate" but my query relates to the consequences of accepting that document. Article 34b states IF the document indicates that it has been issued in more than one original then all originals must be presented. Here the document does not state the number of originals. Would the documents be considered compliant as only one "original" was presented and the copy headed "duplicate" be considered just that, a copy.
All opinions are welcomed.
does the insurance need to identify the countersigning party
does the insurance need to identify the countersigning party
Hello Simon J,
For your two queries on cargo insurance, we have the following comments made before we leave Toronto today for DC, BL & Frauds workshops in Hong Kong for about two or three weeks.
QUERY1
From your description, it appears that you have mixed up two kinds of insurance documents, the insurance policy and the insurance declaration under an open cover (Article 34 (d)), which work on different practices. So there is no one-size-to-fit-all answer here.
Please bear in mind that although the terms “endorsed” and “counter-signed” are use interchangeably in the marketplace, due to parties in general are not clear that these two terms are different, they mean different things academically. To countersign is a process mainly to validate the insurance document that needs this process. It may not mean ALSO to pass the “right to claim” to another party, which “endorsement” is all about. Endorsement may not mean, “to validate”.
Hence the more we know, the more we don’t know (what you really mean). Before you determine that is a discrepancy or not, you have to make sure whether the signature is for endorsement or for countersigning. Otherwise you would lose the case if it were resolved in a court of law. This again demonstrates that document examination needs basic knowledge on insurance. Mere banking knowledge cannot do, we are afraid.
In general a policy needs endorsement to pass the “right to claim” to the applicant. A declaration under open cover needs a countersignature to make it validate, as expressly stated in certain such documents.
QUERY 2
If the DC asks for one original insurance document, and one original insurance document is presented, from common sense point of view, we find it difficult to establish a discrepancy FOR THIS REASON ALONE. Reasons? The specific requirement of the DC would override the UCP 500 Articles.
Article 34 (b) only says “IF” and not “MUST”, concerning an insurance document stating the number of originals being issued. There is no such requirement mentioned in the ISBP either. So if the beneficiary asks you: “Which Article of the UCP 500 or ISBP that I have violated?” Then it is difficult for you to answer this question – according to Canadian banking practice?
See you all in middle of December.
DISCLAIMER: Comments made above are solely for discussion purpose. Parties, including Simon J, have to consult a competent lawyer or expert before they rely or act upon our opinions. We are not responsible for any consequences whatsoever.
[edited 11/29/02 4:48:59 PM]
[edited 12/3/02 5:19:54 PM by sean (Moderator)]
[edited 12/3/02 5:20:56 PM by sean (Moderator)]
For your two queries on cargo insurance, we have the following comments made before we leave Toronto today for DC, BL & Frauds workshops in Hong Kong for about two or three weeks.
QUERY1
From your description, it appears that you have mixed up two kinds of insurance documents, the insurance policy and the insurance declaration under an open cover (Article 34 (d)), which work on different practices. So there is no one-size-to-fit-all answer here.
Please bear in mind that although the terms “endorsed” and “counter-signed” are use interchangeably in the marketplace, due to parties in general are not clear that these two terms are different, they mean different things academically. To countersign is a process mainly to validate the insurance document that needs this process. It may not mean ALSO to pass the “right to claim” to another party, which “endorsement” is all about. Endorsement may not mean, “to validate”.
Hence the more we know, the more we don’t know (what you really mean). Before you determine that is a discrepancy or not, you have to make sure whether the signature is for endorsement or for countersigning. Otherwise you would lose the case if it were resolved in a court of law. This again demonstrates that document examination needs basic knowledge on insurance. Mere banking knowledge cannot do, we are afraid.
In general a policy needs endorsement to pass the “right to claim” to the applicant. A declaration under open cover needs a countersignature to make it validate, as expressly stated in certain such documents.
QUERY 2
If the DC asks for one original insurance document, and one original insurance document is presented, from common sense point of view, we find it difficult to establish a discrepancy FOR THIS REASON ALONE. Reasons? The specific requirement of the DC would override the UCP 500 Articles.
Article 34 (b) only says “IF” and not “MUST”, concerning an insurance document stating the number of originals being issued. There is no such requirement mentioned in the ISBP either. So if the beneficiary asks you: “Which Article of the UCP 500 or ISBP that I have violated?” Then it is difficult for you to answer this question – according to Canadian banking practice?
See you all in middle of December.
DISCLAIMER: Comments made above are solely for discussion purpose. Parties, including Simon J, have to consult a competent lawyer or expert before they rely or act upon our opinions. We are not responsible for any consequences whatsoever.
[edited 11/29/02 4:48:59 PM]
[edited 12/3/02 5:19:54 PM by sean (Moderator)]
[edited 12/3/02 5:20:56 PM by sean (Moderator)]
does the insurance need to identify the countersigning party
Briefly, and without liability/responsibility, re:
1) I do not see sub-Art34a as being relevant. To me it is a simple matter of any required signature having to indicate on whose behalf it is given. Therefore, where an insurance document indicates it requires the counter-signature of the insured in order to be valid, I believe that that counter-signature must expressly indicate it is given on behalf of the insured, for example by the use of the insured’s company name.
2) In my experience, often insurance certificates marked ‘duplicate’ appear to be as legally effective as insurance certificates marked ‘original’. In other words, these ‘duplicates’ are not ‘non-negotiable’ copies, but ‘originals’. Therefore, how the document you described would be considered would I believe depend on its apparent legal status. To me, if the ‘duplicate’ appeared, from its terms, to be an ‘original’ -in other words the document could apparently be used to make a claim or to transfer the right to make a claim- then it would have to be treated as such and consequently rejected in the case of the credit you describe.
[edited 11/29/02 4:53:28 PM]
1) I do not see sub-Art34a as being relevant. To me it is a simple matter of any required signature having to indicate on whose behalf it is given. Therefore, where an insurance document indicates it requires the counter-signature of the insured in order to be valid, I believe that that counter-signature must expressly indicate it is given on behalf of the insured, for example by the use of the insured’s company name.
2) In my experience, often insurance certificates marked ‘duplicate’ appear to be as legally effective as insurance certificates marked ‘original’. In other words, these ‘duplicates’ are not ‘non-negotiable’ copies, but ‘originals’. Therefore, how the document you described would be considered would I believe depend on its apparent legal status. To me, if the ‘duplicate’ appeared, from its terms, to be an ‘original’ -in other words the document could apparently be used to make a claim or to transfer the right to make a claim- then it would have to be treated as such and consequently rejected in the case of the credit you describe.
[edited 11/29/02 4:53:28 PM]
does the insurance need to identify the countersigning party
Jeremy,
HOW TO EAT AN ELEPHANT? ONE SMALL PIECE AT A TIME TO AVOID CHOKING
Simon J has not specified clearly whether the insurance documents in Query 1 and Query 2 are one and the same or different document. If the insurance document in Query 1 WERE a policy, it should not need a counter-signature. We are therefore confused.
In fact, not all insurance documents are properly issued. Never assume. We have dealt with one fire policy issued in Hong Kong to the holding company covering a fire risk of its subsidiary, a hydrocarbon plant located in China. But the pre-printed words in that fire policy said that the insured in China was required to meet the Hong Kong Fire Services Regulations! When we went to the “kitchen”, we found that the clerk used a “Hong Kong” fire policy form instead of a “China” fire policy form. It went through the busy manager who signed it. The insured just filed it after receipt. This error never surfaced until being placed before us.
To avoid doubts like this, it is better for an enquirer to ask one query/one case/one issue in one posting. As a consultant, we are trained by the cases we deal with not to assume, because the price would be very high.
For Query 2, it is clear that a certificate of insurance is presented, but not known in Query 1. We also heard some people say “counter-sign” to mean ” endorse”. This is particularly so when they use a language other than English because the translations may further confuse these two terms.
For example, in Chinese, "counter-sign" means literally "adding a signature" whereas "endorse" means "sign on the back side".
Article 19 of ISBP regards a duplicate as an original.
I am about to go to the Airport.
[edited 11/29/02 9:47:31 PM]
[edited 12/3/02 5:21:42 PM by sean (Moderator)]
HOW TO EAT AN ELEPHANT? ONE SMALL PIECE AT A TIME TO AVOID CHOKING
Simon J has not specified clearly whether the insurance documents in Query 1 and Query 2 are one and the same or different document. If the insurance document in Query 1 WERE a policy, it should not need a counter-signature. We are therefore confused.
In fact, not all insurance documents are properly issued. Never assume. We have dealt with one fire policy issued in Hong Kong to the holding company covering a fire risk of its subsidiary, a hydrocarbon plant located in China. But the pre-printed words in that fire policy said that the insured in China was required to meet the Hong Kong Fire Services Regulations! When we went to the “kitchen”, we found that the clerk used a “Hong Kong” fire policy form instead of a “China” fire policy form. It went through the busy manager who signed it. The insured just filed it after receipt. This error never surfaced until being placed before us.
To avoid doubts like this, it is better for an enquirer to ask one query/one case/one issue in one posting. As a consultant, we are trained by the cases we deal with not to assume, because the price would be very high.
For Query 2, it is clear that a certificate of insurance is presented, but not known in Query 1. We also heard some people say “counter-sign” to mean ” endorse”. This is particularly so when they use a language other than English because the translations may further confuse these two terms.
For example, in Chinese, "counter-sign" means literally "adding a signature" whereas "endorse" means "sign on the back side".
Article 19 of ISBP regards a duplicate as an original.
I am about to go to the Airport.
[edited 11/29/02 9:47:31 PM]
[edited 12/3/02 5:21:42 PM by sean (Moderator)]
does the insurance need to identify the countersigning party
1) Item 1 refers to "certificates" at no point was a policy or open cover referred to.
2) The issue in item 1 refers to the "countersignature" to validate the insurance. No mention was made to "endorsement" so please let us not bring that into the equation.
3) My opinion mirrored that of Jeremy"s yet I could not back it up with ICC500 nor with ISBP.
4)Item 1 and 2 are two separate topics not relating to the same document. However, to avoid future confusion, I shall address one issue per topic posted.
5)ISB article 19 does state that "duplicate" will be regarded as an original but it also states 'DOCUMENTS ISSUED IN MORE THAN ONE ORIGINAL MAY BE..." The question here is how to approach it if the certificate does not state that it was issued in more than "one original". If there is no mention then we take it that there is only a sole original.
6) TOTLEE, have a good trip
2) The issue in item 1 refers to the "countersignature" to validate the insurance. No mention was made to "endorsement" so please let us not bring that into the equation.
3) My opinion mirrored that of Jeremy"s yet I could not back it up with ICC500 nor with ISBP.
4)Item 1 and 2 are two separate topics not relating to the same document. However, to avoid future confusion, I shall address one issue per topic posted.
5)ISB article 19 does state that "duplicate" will be regarded as an original but it also states 'DOCUMENTS ISSUED IN MORE THAN ONE ORIGINAL MAY BE..." The question here is how to approach it if the certificate does not state that it was issued in more than "one original". If there is no mention then we take it that there is only a sole original.
6) TOTLEE, have a good trip
does the insurance need to identify the countersigning party
Re your:
3); I would not expect this to be covered by ISBP or UCP; to me it is a routine matter of law.
5); I would agree with the last sentence.
3); I would not expect this to be covered by ISBP or UCP; to me it is a routine matter of law.
5); I would agree with the last sentence.
-
larryBacon
- Posts: 689
- Joined: Fri Apr 05, 2019 5:26 pm
does the insurance need to identify the countersigning party
Article 34b requires all originals unless otherwise authorised in the credit. The wording stated in the initial posting called for one original to be presented. It did not indicate whether or not more than one original was to be issued. Therefore the duplicate should be regarded as an additional document and treated as such.
Laurence
Laurence