[2] The principle of strict conformity with the face of the letter of credit and its exception

[3] In a case where the description of the goods and the description of the goods in the invoice of the letter of credit are identical to all the description of the goods and the indication of the country of origin in transit with that of the country of origin in transit, but the description of the goods in the letter of order is stated as "Korean 0.043% Sulllur", the case holding that the description of the goods in the letter of order is identical to that of the letter of credit because it is expressed in general terms that are not inconsistent with the description of the goods in the letter of credit

[4] In a case where the beneficiary demands a copy of the order of release issued by the beneficiary when claiming for the price of the letter of credit, and the beneficiary partly corrected the description of the goods in the copy of the order of release without authentication, whether the copy of the order of release loses the regularness and status of the document (negative)

[5] Whether the issuing bank may refuse to pay the credit amount by asserting new defects that have not been initially stated after the expiration of the period stipulated in Article 14 (d) (i) of the Uniform Customs and Practice for Documentary Credits (negative)

[6] Where an issuing bank knew, or could have known, that part of the documents related to the credit were subsequently replaced in the course of examining several documents related to the credit received on the same date, whether payment for the credit can be refused on the ground that the documents inconsistent with the conditions of the credit and the revised documents were inconsistent (negative)

[2] It does not mean that the documents attached to a letter of credit must strictly comply with the terms and conditions of the letter of credit. Even if there is a little difference in the letter of credit, if the difference is insignificant and does not cause any difference in the meaning of the letter of credit, or if it can be discovered on the face that it does not entirely harm the terms and conditions of the letter of credit, it shall be deemed that the difference in the terms and conditions of the letter of credit is consistent with the terms and conditions of the letter of credit. The determination should be based on whether the difference in the terms and conditions of the letter of credit is permissible in light of international banking business practices.

[3] In a case where the description of the goods and the description of the goods in the invoice of the letter of credit are identical to all the description of the goods and the indication of the country of origin in transit with that of the country of origin in transit, but the description of the goods in the letter of order is stated as "Korean 0.043% Sulllur", the case holding that the description of the goods in the letter of order is identical to the conditions of the letter of credit, in a case where the description of the goods in the letter of credit and the description of the goods in the invoice are written as "Kore 0.043% Sulpur"

[4] According to Article 15 (1) of the UCP 5th Amendment, the UCP 600 provides that "the bank shall not bear any obligation or responsibility with respect to the form, sufficiency, accuracy, authenticity, forgery, or legal effect of all documents, or with respect to the general conditions and/or special conditions stated or stated in the documents, and Article 10 of the International Standard Banking Practice decided by the International Commercial Conference with the approval of the Bank Committee shall be "other than bills of exchange, which are issued by the beneficiary, and which do not have any similar type of certificate, a correction or alteration is not required for the correction or alteration of the documents issued by the beneficiary at the request of the beneficiary for the delivery of the documents, and even if the beneficiary did not correct or modify the documents, it shall not be deemed that the regular letter of credit does not lose the validity of the corrective order as a copy of the documents issued by the beneficiary."

[5] Article 14 (d) (i) of the Uniform Customs and Practice for Documentary Credits (UCP 500) provides that "in cases where an issuing bank and/or confirming bank (if any) or a designated bank acting therefor decides to refuse documents, it shall promptly notify the issuing bank of the purport of refusal by telegraph or by other prompt means, counting from the date of receipt of the documents until the closing time of the 7 banking business day after the 7 banking day. Such notification shall be given to the bank which received the documents directly from the beneficiary." Paragraph (ii) of the same Article provides that "in cases of giving such notification, banks shall specify all defects for which the documents were rejected, banks shall at the same time specify the issuing bank's first order, and banks shall not otherwise specify whether or not the issuing bank refuses to pay the documents, and banks shall not otherwise specify whether or not the issuing bank refuses to issue the documents, and in cases where the issuing bank refuses to issue the documents within the time limit specified in the first Credit."

[6] An issuing bank is not obligated to examine and examine whether the documents presented to the L/C bank are strictly consistent with the terms and conditions of the L/C on its face, and whether the documents related to the L/C themselves have been altered with the documents related to other L/C. However, it is not allowed under the principle of good faith to refuse payment of the L/C price on the ground that the L/C documents were partially altered in the course of examining upon receipt of several L/C documents on the same day, or that it was easy for the L/C issuing bank to know if it was aware of the fact that some of the documents related to the L/C were altered, or that it was easy

1. Regarding ground of appeal No. 1

Article 37(b) of the Uniform Customs and Practice for Documentary Credits (UCPS and Pact for 193 Uniforms, ICC Pact, No. 500, hereinafter “Rules for the Unification of Credit”) provides that “ Unless otherwise stipulated in the letter of credit, banks may not accept commercial invoices issued in excess of the amount permitted in the letter of credit, and if the price increase or decrease in the unit price of the letter of credit can not be determined separately from the unit price of the letter of credit to the price increase or decrease in the amount stipulated in the letter of credit in accordance with the actual condition of the letter of credit, the price increase or decrease in the amount stipulated in the letter of credit can not be determined separately from the unit price of the letter of credit to the price increase or decrease in the amount stipulated in the letter of credit.”

According to the reasoning of the judgment below, the court below rejected the defendant's assertion that each of the credit of this case issued by the plaintiff (Counterclaim defendant; hereinafter "the plaintiff") is against the conditions of the credit of this case on the ground that the amount of the credit of this case exceeds 800,000 US dollars, the volume and 10% of the amount of the credit of this case, and the amount of the goods purchased by the defendant (Counterclaim plaintiff; hereinafter "the defendant") exceeds 10% of the amount of the credit of this case, but the amount of each of the credit of this case is determined according to the price clause under the additional conditions of each of the credit of this case, and the amount of the credit of this case is automatically increased or decreased without additional revision of the conditions of the credit of this case, considering the circumstances where it is impossible to specify the price of the goods at the time of each of the credit of this case at the time of the issuance of each of the credit of this case.

In light of the above legal principles and records, the above judgment of the court below is just, and there is no error in the misapprehension of the legal principles as to the interpretation of the terms and conditions of credit or the interpretation of the Uniform Customs and Practice

2. As to the grounds of appeal Nos. 2 through 3

Inasmuch as documents attached to a credit must strictly comply with the terms and conditions of the credit, it does not mean that the wording must be completely identical with one another. Even if there is a little difference in the wording, if the difference is insignificant and does not cause any difference in the meaning of the text and language, or if it can be discovered on the face that it does not entirely impair the conditions of the credit, it shall be deemed that the difference in the terms and conditions of the credit is consistent with the conditions of the credit. The determination shall be based on whether the difference in the terms and conditions of the credit can be acceptable in light of international banking practices (see, e.g., Supreme Court Decision 2004Da34158, May 12, 2006): Provided, Article 37(c) of the Uniform Customs and Practice for Documentary Credits provides that “The description of the goods in the invoice shall be identical with the description of the goods in all other documents may be expressed in general terms not inconsistent with the description of the goods in the credit, and thus, it shall not be deemed that the description of the goods, other than commercial invoice and other documents, are inconsistent with the credit’s. 985.

According to the reasoning of the judgment below and the evidence duly admitted by the court below, the product description of the letter of credit of this case and the product description of the invoice in the invoice are identical to all the product description and the country of origin in transit to "Saman Mai Do" or "Saman Do". However, the product description of each of the letter of delivery of this case is described as "Kean 0.043% Sulll 043% Sulhur", and the product description of the above product is indicated as "0.043% Sulhur", and in the oil industry, it is known that "Kean 0.043% Sul 0 Sulphur" is used as a transit that has been determined in accordance with the Korean quality standards.

Examining the above facts in light of the legal principles as seen earlier, if the negotiating bank examines the description of the goods in the invoice, it shall be consistent with the description of the letter of credit, but if the description of the goods in each of the instant order does not mutually connect the description of the goods in the letter of credit or conflict with the contents of the letter of credit, it shall be deemed as a document that is consistent with the terms and conditions of the letter of credit. Since the goods description of each of the instant order is interpreted as "Kean Lats 0.043% Sulhur" in the goods description of each of the instant order of release, it shall be interpreted as being refined in accordance with the quality standards of Korea ordinarily used in the oil industry, which is the meaning ordinarily used in the oil industry, and therefore, it shall not be interpreted as "Kean Lats" in the goods description as "Korea via Korea." In addition, even if there is no indication of origin like the description of the goods in the letter of credit, it shall not be contradictory to the description of the goods in the letter of credit.

Therefore, although the court below erred in excluding an indication of origin from the list of goods of other documents including the indication of origin stated in the item column of the letter of credit of this case on the ground that it is a non-documentary condition, it is just in rejecting the plaintiff's assertion that the copy of the letter of delivery was expressed as a general term which is not inconsistent with the description of goods of each of the letter of credit of this case and that the copy of the letter of delivery is not inconsistent with the contents of the letter of credit of this case. There is no error in the misapprehension of the Supreme Court's decision or the misapprehension of legal principles in the application of the Uniform Customs and Practice for Documentary Credits as alleged in the ground of appeal

3. As to the fourth ground for appeal

According to Article 15(1) of the Uniform Customs and Practice for Documentary Credits, “the Bank shall not be obligated or liable for all documents in its form, sufficiency, accuracy, authenticity, forgery, or legal effect, or with respect to the general conditions and/or special conditions specified or stated in the documents.” Article 10 of the International Commercial Conference’s “International Standard Bank Practice (ISBP)” provides that “The International Commercial Conference shall not, upon request by the beneficiary, request the correction or modification of the documents issued by the beneficiary, and even if a copy of the documents issued by the beneficiary cannot be deemed to have been withdrawn from the documents issued by the beneficiary, the correction or modification of the documents issued by the beneficiary cannot be deemed to have been made without the beneficiary’s request for correction or modification of the documents issued by the beneficiary.”

According to the reasoning of the judgment below, the court below acknowledged facts as stated in its reasoning, and determined that each of the correction parts of the order for release related to the letter of credit Nos. 4 through 9 of this case could not be deemed to have changed to the content itself, since it is difficult to view that the omission of the signature or seal of the person holding the authority to prepare each of the correction parts of the order for release did not have the regularness and condition of the document.

In light of the above legal principles and records, the above judgment of the court below is just, and there is no error in the misapprehension of legal principles as to the violation of the Supreme Court precedents or the application of the Uniform Customs and Practice for Documentary Credits.

4. As to grounds of appeal Nos. 5 and 7

Article 14 (d) (i) of the Uniform Customs and Practice for Documentary Credits provides that "if an issuing bank and/or a confirming bank (if any) decides to refuse documents, or a nominated bank acting therefor, the issuing bank shall, without delay, notify the bank of the purport of refusal to pay the credit amount for reasons of defects of the credit and its related documents by no later than the end of the 7 banking business day immediately following the date of receipt of the documents, and if the bank which received the documents directly from the beneficiary, it shall do so to the beneficiary." Further, Article 14 (d) (ii) provides that "if it receives the same notification as above, the bank shall specify all defects of the documents refused, and at the same time, the bank shall state whether it is keeping the documents in custody or in return." In light of the purport of the above provision, if the issuing bank, which received the credit amount and its related documents from the negotiating bank, refuses to reject the payment of the credit amount for reasons of defects of the credit amount, the issuing bank shall, unless otherwise agreed, notify the bank of the refusal to do so within 2016.

According to the reasoning of the judgment below and the records, the plaintiff notified the seller of the defect notification related to the letter of credit Nos. 1 and 3 of this case that "the description of the goods stated in the seller's order of removal differs from the description of the letter of credit and the commercial invoice," and notified the seller of the defect that the description of the goods in the commercial invoice was omitted, or that the description of the goods in the commercial invoice is different from the description of the letter of credit." As to the letter of credit Nos. 4 and 9 of this case, the plaintiff notified the seller of the defect that "the date stated in the seller's order of removal is earlier than the date of the confirmation of the defendant." The plaintiff did not notify the seller that the date

In light of the above facts in light of the legal principles as seen earlier, unlike the defect contents of the plaintiff's notification clearly stated, the product description of the commercial invoice related to the letter of credit Nos. 1 and 3 of this case was omitted, or the letter of credit Nos. 4 through 9 of this case cannot be refused to pay the price of the letter of credit because the seller's letter of credit was issued prior to the date of approval of the condition of the letter of credit, or the goods were removed. Therefore, the judgment of the court below to the same purport is just, and there is no violation of the Supreme Court precedents as to the notification of defects

5. Regarding ground of appeal No. 6

An issuing bank of a letter of credit may, on its face, examine the documents presented to the bank on its face, with due care as to whether the documents presented to the bank are strictly consistent with the conditions of the letter of credit, and it is not obligated to examine and examine whether the documents related to the letter of credit themselves were altered with the documents related to other letters of credit. However, in the course of examining the documents related to the letter of credit received on the same day, the issuing bank knew that some of the documents related to the letter of credit were altered, or could have been easily known if he paid due attention, it is not allowed to refuse payment of the amount of the letter of credit on the ground that the documents presented to the bank

According to the reasoning of the judgment below, the court below acknowledged the facts as stated in its reasoning. Gap evidence No. 8-1 alleged by the plaintiff as a copy of the order of release No. 8-2 of this case is the related documents of the letter of credit No. 2 of this case, and Gap evidence No. 8-2 of this case asserted by the plaintiff as a copy of the order of removal No. 2 of this case can be sufficiently estimated, and as long as the copy of the order of removal was sent from the defendant on the same day to the plaintiff, the plaintiff was merely replaced by the copy of the above order of removal, and it was merely replaced by the other documents that are inconsistent with the product quantity of each commercial invoice, or by exercising due care, it could be sufficiently known if the plaintiff knew that the copy of the above order of removal was not a document that is inconsistent with the product quantity of each commercial invoice, and thus, it could not be refused to pay the price of the letter of credit.

In light of the above legal principles and records, the above judgment of the court below is just, and there is no error in the misapprehension of the legal principles as to the application of the Supreme Court precedents or the Uniform Customs and Practice for Documentary Credits.

6. Conclusion

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Ahn Dai-hee (Presiding Justice)