Non-performance of an unconditional L/C

SharifElkasaby · Post by **SharifElkasaby** » Tue Feb 06, 2001 12:00 am

In this case, the Buyer will issue an unconditional L/C payable after one day and one year. The Seller, will issue a L/G and his bank will also provide a Bank Warrenty. My question is, if the Seller fails to perform the contract will the buyer be able to cancel the Unconditional L/C? What are the ICC rules in such an event?

ALISTAIRO · Post by **ALISTAIRO** » Tue Feb 06, 2001 12:00 am

If the L/C is irrevocable as it will be, it cannot be cancelled without the agreement of all the parties involved.

A word of caution - L/Cs are rarely termed unconditonal and a period of one year and one day is suspicious - frauds are often set up like this.

vobrien · Post by **vobrien** » Thu Apr 12, 2001 1:00 am

The term unconditional LC issued subject to UCP 500 does not make sense.

Article 9 A. "An irrevocable Credit constitutes a definite undertaking of the Issuing Bank, provided (on condition) that the stipulated documents are presented "

Vincent O'Brien
vob@obrico.com

T.O.Lee · Post by **T.O.Lee** » Wed May 23, 2001 1:00 am

If "unconditional", "absolute", "independent", "indivisible" LC is also issued by a "prime Bank" valid for "one year and one day", there is a high probability of trade frauds. Nearly all the jargons highlighted above are typical terminologies used by the Nigerian school of fraudsters. The enquirer should check with ICC Commercial Crime Services in London for prudency reasons.

I am from www.tolee.com

[edited 6/14/01 8:52:19 PM]