Article 35 And When The Document Is Partly Lost

[gegeeee]

Colleagues hi,

Given below the case:
A Bank issued a credit requiring 3/3 Original BL along with other documents. The nominated
presented the documents to the issuing bank and listed 3/3 Original BL in its forwarding schedule.
But the issuing bank, upon checking, found only one two original BL with the presentation and
refused to honor quoting ‘Two instead of Three original BL presented’. The nominated bank insisted
that it had sent three originals and urged to make payment according to UCP600 Article 35. (Q 9 & 10)
1 B/L was missing, otherwise document were complying.

Question 10: Which of the following statement is correct under the circumstances above?
A. The issuing bank must honor
B. The issuing bank has no obligation to honor
C. UCP does not cover the issue. This is a relationship issue.
D. None of the above

Correct answer showed is C.

If all documents were lost in transit and documents were presented within expiry date at Nominated Banks counters, issuing bank must honor.

But I am interested why article 35 is not applicable in such situation? All documents complied and 1 B/L was lost in transit.

Does anybody have any idea?

Best,
Gega

[picant]

Hi Gegeeee,

if the set of documents arrived and 1/3 bill of lading is missed this is not the intention of Art 35 that covers the loss of the set of documents. If one original is missed, you have to report it to the presenting bank, but having the rest of originals your applicant may take up the goods.
Naturally the applicant will ask the carrier agent sbout the possibility of somebody already took up the goods.
URC are ruling the lacking of documents in a collection.
Ciao

[quang]

I choose C, one of two bank is not telling the truth, so UCP does not cover the issue. This is a relationship issue