Key point:

The independent guarantee letter claim case should fully respect and apply the international transaction rules agreed upon by the parties, accurately define the rights and obligations of the parties, and ensure the normal transaction order of the independent guarantee letter.

Brief of case:

AA Company in South Korea signed a supply contract with BB Company in Zhejiang. BB Company in Zhejiang applied to Industrial and Commercial Bank of China for the issuance of an irrevocable demand guarantee, also known as an independent guarantee, as the payment method for the basic transaction. The independent letter of guarantee issued by Industrial and Commercial Bank of China to AA Company in South Korea states that when AA Company claims, it is required to submit a copy of the clean ocean bill of lading marked with freight on delivery as instructed and notified to the applicant. Afterwards, AA Company in South Korea issued multiple claims to Industrial and Commercial Bank of China through a certain bank in South Korea. Industrial and Commercial Bank of China refused payment and issued a notice of refusal to AA Company in South Korea on the grounds of discrepancies in the submitted documents. Therefore, AA Company of South Korea sued and asked ICBC to repay the amount under the guarantee and pay Late fee.

Judgement Result:

After trial, the Hangzhou Intermediate People's Court found that the guarantee agreement in the case is applicable to the Uniform Rules for Demand Guarantees published by the International Chamber of Commerce No. 758, and this agreement is valid. According to the provisions of this rule, when the terms and conditions of the letter of guarantee are clear and clear, the guarantor only needs to consider whether the documents and the terms and conditions of the letter of guarantee are superficially consistent. The performance of the basic contract is not a factor that should be considered during document review. The copy of the registered bill of lading submitted by AA Company in South Korea is significantly different from the copy of the instruction bill of lading required by the letter of guarantee in the case, and there are differences in the type of bill of lading in international trade and maritime transportation. Therefore, the inconsistency claimed by Industrial and Commercial Bank of China is valid. For the claims of AA Company in South Korea, Industrial and Commercial Bank of China issued a refusal notice within the review period. In addition, sending an acceptance notice to a bank in South Korea by Industrial and Commercial Bank of China does not mean that it has gone through the document review process or confirmed the documents under the guarantee, and does not have the legal effect of document compliance with the bank's review. Based on this judgment, the entire application of AA Company in South Korea was rejected. This case has been tried in the second instance and the original judgment has been upheld.

Typical significance:

This case is the first batch of typical cases involving the construction of the "the Belt and Road" by the Supreme People's Court. With important functions such as transaction guarantee, qualification confirmation and financing support, independent letter of guarantee has become an indispensable financial guarantee tool for Chinese enterprises in the process of "going global" and "the Belt and Road" construction. The court should fully respect and apply the international transaction rules agreed upon by the parties in the trial of independent guarantee letter claims, accurately define the rights and obligations of the parties, and ensure the normal order of independent guarantee letter transactions. This case is based on the Uniform Rules for Demand Guarantees of the International Chamber of Commerce, which specify the application of the letter of guarantee. The principle of strict conformity and surface conformity is applied. Based on the presentation of the document itself, the document is reviewed to determine whether it strictly follows the terms and conditions of the letter of guarantee, and the existence of discrepancies is determined. This fully demonstrates the court's ability to accurately apply international transaction rules. The judgment in this case clearly states that a seemingly consistent conclusion cannot be drawn based on the performance of the basic contract, reflecting full respect for the principles of independent letter of guarantee document transactions and independence, and effectively ensuring the order of independent letter of guarantee transactions.