In a case where a lending bank against a beneficiary of a letter of credit agrees to acquire an export bill issued by the lending bank as a security for transfer to a guarantee agency for the loan, whether the lending bank is obligated to acquire a legitimate security for transfer by investigating not only the bill of exchange itself but also shipping documents in acquiring an export bill of exchange (affirmative)

An export bill of exchange issued under the terms and conditions of the letter of credit is a bill of exchange issued by the export merchant designated as the beneficiary of the letter of credit, whose rights under the bill of credit and the bill of lading representing goods in transit are secured by the letter of credit and the bill of lading, etc. Accordingly, if a lending bank for the beneficiary of the letter of credit agrees to acquire such export bill of exchange as a security to a guarantee agency for the loan, it is obligated to acquire a legitimate security by investigating, with due care, whether not only the bill of exchange itself is consistent with the terms and conditions of the letter of credit in acquiring the export bill of exchange but also the documents acquired as a security for transfer are contradictory or inconsistent with those of the documents concerned.

Article 428 of the Civil Code, Article 13 of the Uniform Customs and Practice for Documentary Credits (the fifth amended in 1993)

National Bank Co., Ltd., a lawsuit taking over the National Bank of Korea (Law Firm Rate, Attorney Cho Il-young, Counsel for the defendant-appellant)

(Attorney Cho Young-il, Counsel for the defendant-appellant)

Seoul District Court Decision 2000Na21030 Delivered on September 1, 2000

The judgment of the court below is reversed, and the case is remanded to the Seoul District Court Panel Division.

The grounds of appeal are examined.

1. According to the reasoning of the judgment below, the court below, on March 20, 1998, concluded a credit transaction agreement or foreign exchange transaction agreement with the plaintiff, and issued a credit guarantee agreement of 258 million won to the plaintiff on April 4, 1998, with the guarantee principal, 290 million won. The defendant, as a special agreement, issued a credit guarantee agreement to the plaintiff for the same purpose as the export bank's credit guarantee agreement, "loans under this guarantee agreement: L/C No. 98036) can be used for the same purpose as the export bank's credit guarantee agreement to obtain the export bill from the above export bank for the same purpose as that of the export bank's 90 million won." On the other hand, the court below determined that the bank's 90,000 won cannot be used for the same purpose as that of the export bank's 90,000 won export bill for the same purpose as that of the export bank's 198,000 won credit guarantee agreement.

2. However, we cannot accept the above judgment of the court below.

An export bill of exchange issued under the terms and conditions of the letter of credit is a bill of exchange issued by the exporter designated as the beneficiary of the letter of credit, whose rights under the bill of credit and the bill of lading representing goods in transit are secured by the letter of credit and the bill of lading, etc. Accordingly, if a lending bank for the beneficiary of the letter of credit agrees to acquire such export bill of exchange as a security for transfer to a guarantee agency for the loan, it shall be obligated to acquire the bill of exchange in acquisition of the bill of exchange itself as well as the document acquired as a security for transfer is consistent with the terms and conditions of the letter of credit in the face of the letter of credit, and there is any inconsistency or inconsistency between the related documents by investigating with due care.

According to the records, the export bill and shipping documents of this case, which the plaintiff bank acquired through the transfer for security from October 200, are different from the letter of credit or other documents, and the name of the ship indicated in the commercial invoice does not coincide with the other documents, and thus, the plaintiff bank, according to the records of the bank issuing the letter of credit, issued the letter of credit, was supplemented on March 28, 1998, and the shipper stated in the commercial invoice and packing invoice were different from the bill of credit's address and the exporter's address in the letter of credit are different from the other documents' address. Thus, the issuing bank return the documents on the ground of the above defect and decided not to pay the export bill. Thus, if there are such circumstances, the plaintiff bank, as security acquiring the documents provided as the transfer for transfer, neglected its duty to investigate whether the documents provided are inconsistent with the contents of the letter of credit and the documents are inconsistent with or inconsistent with those of the other documents, and thus, violated the matters under the credit guarantee agreement of this case by obtaining legitimate transfer for transfer from the plaintiff.

Nevertheless, the court below's rejection of the defendant's assertion of exemption on the ground that it is merely a collection bank's function to collect export bills from the exporter upon the request of the exporter for collection of export bills, and thus, it is erroneous in the misapprehension of legal principles as to the acquisition of export bills as collateral or the provision of a credit guarantee contract issued in accordance with the export letters of credit export terms. The ground of appeal pointing this out has merit.

3. Therefore, without examining the remaining grounds of appeal, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Cho Cho-Un (Presiding Justice)