In Crédit Agricole Corporate & Investment Bank, Singapore Branch v PPT Energy Trading Co Ltd and another appeal [2023] SGCA(I) 7, the Singapore Court of Appeal clarified the scope of the fraud exception in the context of letters of credit, and rejected an issuer’s attempt to challenge the validity of a letter of credit on grounds of a fraud perpetrated by the buyer, its customer, which the beneficiary was not party to.
Notwithstanding the above, the Court of Appeal overturned the decision of the Singapore International Commercial Court at first instance, finding that the beneficiary had breached its warranty of having marketable title to the cargo at the time property passed. The beneficiary was therefore liable, under a letter of indemnity presented to the issuer in lieu of bills of lading for payment under the letter of credit, for losses resulting from that breach.
This update takes a look at the Court of Appeal’s decision.
If you would like information and/or assistance on the above or any other area of law, you may wish to contact the Partner at WongPartnership whom you normally work with or the following Partner:
TAN Kai Yun
Partner – Restructuring & Insolvency
and Special Situations Advisory
d +65 6416 6869
e kaiyun.tan@wongpartnership.com
Click here to view Kai Yun’s CV.