Applicant Accepts Discrepant Documents

[sean]

Good day,

We are the issuing bank. We received discrepant documents presented under our Documentary Credit. We requested waiver from the Applicant who subsequently took up the discrepant documents however upon accepting he advised that he will pay 7 days later than the day which we as the issuing bank calculated the maturity date to be. We are now out of pocket as foreign bank has debited our nostro account however applicant is only going to pay 7 days later. On our acceptance (MT752) to the negotiating bank should we have advised maturity date as per lc payment terms or the date that the Applicant wants to pay as per his acceptance advice to ourselves? For discrepant documents can the Applicant determine any date that he wants to pay?

[shahriar]

Dear sean,

it appeared that you set the maturity date as per the terms of the LC ignoring the conditions of the applicant. once you have communicated your acceptance and have provided a maturity date, the presenting bank has the right to debit your account.

in case of discrepant document, the applicant may impose some extra conditions as a requisite for waiver. what was necessary is to communicate this condition to the presenting bank and obtain their consent and then set the maturity date as per condition of the applicant. im afraid, i see no solution to the case.

[bdesh]

Hi,
Credit was available
1. By Negotiation (120 days from the date of Negotiation).
2. By Deferred Payment (120 days from the date of Shipment).
Question: -
Despite discrepancy in the original documents, can the Negotiating bank claim that maturity date to be counted form the date of Negotiation/Shipment ?
Regards

[berry]

i think it should be the date of of shipment from which the maturity is to be calculated. not sure about negotiation as the presentation was not complying, the negotiation was not valid

[S.Khalili]

I m in total agreement with the answer of M/S Shahriar.