DOCDEX 385
Issuing bank issued a credit subject to UCP 600 with a condition that a penalty would be deducted from payment in case of delayed shipment.
Documents were submitted included a bill of lading indicating delayed shipment.
Subsequent to the applicant's waiver of discrepancies, the issuing bank advised the beneficiary that no amount was payable due to the penalty clause.
The beneficiary claimed that:
It was concluded that the penalty clause was not non-documentary due to its linkage to the shipment date on the bill of lading.
Furthermore, beneficiary's approval was not required as the penalty condition applied and no instructions from the beneficiary were received before issuing bank's agreeing to applicant's waiver of discrepancies as per UCP 600 sub-article 16 (c) (iii) (b).
DOCDEX 386
The issuing bank issued an advance payment guarantee and, subsequent to a demand under the guarantee, rejected the claim.
The beneficiary was of the opinion that, because it had made a compliant demand, the rejection was invalid. It further considered that, on the basis of URDG 758, the issuing bank was precluded from raising any discrepancy to a compliant demand.
However, the issuing bank responded that since the original SWIFT Message Text Field 40C "APPLICABLE RULES" stated "NONE", the guarantee was not subject to any rules, and that DOCDEX had no jurisdiction.
Having reviewed all the submitted documentation, it was established that the relevant SWIFT message actually did mention the guarantee was subject to URDG 758, with the result that the rules not only applied to the guarantee, but also that DOCDEX did had jurisdiction to opine based upon ICC rules.
It was concluded that the demand was compliant and that, in any event, the issuing bank was precluded from raising any discrepancy eight business days after receiving the demand. The rejection notice was not valid and the issuing bank was liable to honour the demand.
DOCDEX 387
Same as DOCDEX 386
DOCDEX 388
Same as DOCDEX 386
DOCDEX 389
Same as DOCDEX 386