Article 10 (c)
Posted: Tue Jan 05, 2010 12:00 am
Hi all,
Your comments on the following are appreciated.
The issuing bank issued an LC for USD100,000.00, with partial shipments not allowed. Later the issuing bank issued an amendment to decrease the LC amount from USD100,000.00 to USD50,000.00.
The beneficiary did not give notification of acceptance of the amendment but he presented a set of documents for USD50,000.00 which was equal to the new LC amount after amendment.
The issuing bank refused the documents stating the discrepancies: (i) C/O: C/O FORM A PRESENTED I/O C/O FORM E; (ii) B/L: LACK OF LC NO AND DATE, and returned the documents to the presenter.
Later the beneficiary presented a new set of documents for USD100,000.00. However, the issuing bank refused the documents stating the discrepancy “overdrawn” based on the amendment. The issuing bank reasoned that according to Article 10 (c) the amendment was deemed to have been accepted by the beneficiary as of the time the first presentation was made.
The presenter rejected the discrepancy raised by the issuing bank reasoning that the first presentation was refused and the discrepant documents were returned to the beneficiary, hence, it could not be deemed to be notification of acceptance by the beneficiary of the amendment. The issuing bank must honour as the new presentation was complying with the original LC
I tend to support the presenter’s view.
Thanks and regards,
N.H.Duc
[edited 1/5/2010 6:34:57 AM]
Your comments on the following are appreciated.
The issuing bank issued an LC for USD100,000.00, with partial shipments not allowed. Later the issuing bank issued an amendment to decrease the LC amount from USD100,000.00 to USD50,000.00.
The beneficiary did not give notification of acceptance of the amendment but he presented a set of documents for USD50,000.00 which was equal to the new LC amount after amendment.
The issuing bank refused the documents stating the discrepancies: (i) C/O: C/O FORM A PRESENTED I/O C/O FORM E; (ii) B/L: LACK OF LC NO AND DATE, and returned the documents to the presenter.
Later the beneficiary presented a new set of documents for USD100,000.00. However, the issuing bank refused the documents stating the discrepancy “overdrawn” based on the amendment. The issuing bank reasoned that according to Article 10 (c) the amendment was deemed to have been accepted by the beneficiary as of the time the first presentation was made.
The presenter rejected the discrepancy raised by the issuing bank reasoning that the first presentation was refused and the discrepant documents were returned to the beneficiary, hence, it could not be deemed to be notification of acceptance by the beneficiary of the amendment. The issuing bank must honour as the new presentation was complying with the original LC
I tend to support the presenter’s view.
Thanks and regards,
N.H.Duc
[edited 1/5/2010 6:34:57 AM]