Unconscionability in Letters of Credit and Demand Guarantees

Davidson, Alan (2012) Unconscionability in Letters of Credit and Demand Guarantees. International Journal of Technology Policy and Law, 1 2: 183-204. doi:10.1504/IJTPL.2012.050216


Author Davidson, Alan
Title Unconscionability in Letters of Credit and Demand Guarantees
Journal name International Journal of Technology Policy and Law   Check publisher's open access policy
ISSN 1742-4240
1742-4259
Publication date 2012
Year available 2012
Sub-type Article (original research)
DOI 10.1504/IJTPL.2012.050216
Volume 1
Issue 2
Start page 183
End page 204
Total pages 22
Place of publication Bucks, United Kingdom
Publisher Inderscience Publishers
Collection year 2013
Language eng
Formatted abstract
The backbone of the letter of credit is the autonomy principle, which dictates that banks deal with documents and are not concerned with nor bound by any underlying contract. This paper raises the controversial issue that the emerging unconscionability exception to this principle jeopardises the integrity and viability of the letter of credit product. Subsequent cases in Singapore and Malaysian replicate the underlying Australian principle without the legislative platform. The conclusion of the paper is that an understanding of the nature and purpose of letters of credit and the limited application of the fraud exception must lead lawyers in the field to conclude there should be no unconscionability exception.
Keyword Letters of credit; demand guarantees
Unconscionability exception
Fraud exception
Integrity
Viability
Q-Index Code C1
Q-Index Status Provisional Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: Non HERDC
TC Beirne School of Law Publications
 
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Created: Wed, 08 Jan 2014, 15:26:02 EST by Carmen Buttery on behalf of T.C. Beirne School of Law