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Singapore letters of credit

Trafigura Beheer BV v Kookmin Bank Co

[2006] 4 SLR(R) 781
JurisdictionSingapore
CourtSingapore High Court
Year2006
StatusBinding authority

Summary

A letter of credit is autonomous from the underlying contract; the bank's obligation to pay arises solely from compliance with documentary requirements, not actual performance of the sale contract.

Key Principle

The SGHC held that a letter of credit is autonomous from the underlying contract; the bank's obligation to pay arises solely from compliance with the documentary requirements, not the actual performance of the sale contract (the autonomy principle).

Area of Law

shipping

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Singapore Court of Appeal considered maritime liens for necessaries (bunker supply), title to sue under transferred bills of lading, and privity/assignment issues in shipping claims.

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Under a bill of lading governed by the Hague-Visby Rules, a carrier's obligation to properly load and stow cargo is non-delegable.

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