Mizuho Corporate Bank v Cho Hung Bank: Forum Non Conveniens & Letter of Credit Dispute
Mizuho Corporate Bank Ltd Singapore branch (MCB) sued Cho Hung Bank (CHB) in Singapore after CHB rejected documents under a letter of credit. CHB applied for a stay of proceedings, arguing South Korea was a more appropriate forum. The High Court of Singapore dismissed CHB's appeal, finding that CHB failed to establish that South Korea was a clearly more appropriate forum than Singapore. The court considered factors such as the governing law of the contract, the parties' connections to the forums, and the availability of witnesses. The claim was related to a letter of credit.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Appeal Dismissed
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court dismisses Cho Hung Bank's stay application, finding Singapore the appropriate forum for a letter of credit dispute with Mizuho Corporate Bank.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Mizuho Corporate Bank Ltd | Respondent | Corporation | Appeal Dismissed | Won | Toh Kian Sing, Ian Teo |
| Cho Hung Bank | Appellant | Corporation | Appeal Dismissed | Lost | Chou Sean Yu |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Tan Lee Meng | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Chou Sean Yu | Wong Partnership |
| Toh Kian Sing | Rajah and Tann |
| Ian Teo | Rajah and Tann |
4. Facts
- CHB issued a letter of credit for the purchase of gas oil.
- MCB was the confirming bank for the letter of credit.
- Nissho Iwai Petroleum (Singapore) Pte Ltd was the beneficiary of the letter of credit.
- MCB presented documents to CHB seeking payment of US$1,715,699.15.
- CHB rejected the documents, citing discrepancies.
- MCB commenced legal proceedings in Singapore against CHB.
- CHB commenced proceedings in South Korea for a declaration of non-liability.
5. Formal Citations
- Mizuho Corporate Bank Ltd v Cho Hung Bank, Suit 66/2004, RA 105/2004, [2004] SGHC 159
6. Timeline
| Date | Event |
|---|---|
| CHB issued letter of credit no M1655308NS00057 | |
| Letter of credit amended | |
| MCB despatched documents to CHB | |
| CHB received documents | |
| CHB rejected the documents | |
| Assistant registrar dismissed CHB’s application | |
| Appeal dismissed |
7. Legal Issues
- Forum Non Conveniens
- Outcome: The court held that South Korea was not a clearly more appropriate forum than Singapore and dismissed the appeal for a stay of proceedings.
- Category: Procedural
- Related Cases:
- [1998] 1 SLR 253
- [1987] 1 Lloyd’s Rep 1
- [1992] 2 SLR 776
- Letter of Credit Dispute
- Outcome: The court did not make a final determination on the merits of the letter of credit dispute, as the issue was whether the case should be heard in Singapore or South Korea.
- Category: Substantive
8. Remedies Sought
- Declaration of Non-Liability
- Monetary Damages
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Commercial Litigation
- Banking Litigation
11. Industries
- Banking
- Finance
- Oil and Gas
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Oriental Insurance Co Ltd v Bhavani Stores Pte Ltd | Court of Appeal | Yes | [1998] 1 SLR 253 | Singapore | Cited for the principles governing the stay of proceedings based on a more appropriate forum. |
| The Spiliada | N/A | Yes | [1987] 1 Lloyd’s Rep 1 | England | Cited for the approach to determining whether to grant a stay of proceedings based on a more appropriate forum. |
| Brinkerhoff Maritime Drilling Corp & Anor v PT Airfast Services Indonesia and another appeal | Court of Appeal | Yes | [1992] 2 SLR 776 | Singapore | Cited for the application of the principles in The Spiliada regarding stay of proceedings. |
| European Asian Bank AG v Punjab and Sind Bank Ltd | N/A | Yes | [1981] 2 Lloyd’s Rep 651 | England | Cited for the principle that the governing law of a contract between an issuing bank and a confirming bank is the place where the confirming bank carries on business. |
| Kredietbank NV v Sinotani Pacific Pte Ltd | N/A | Yes | [1999] 3 SLR 288 | Singapore | Cited for the principle that the governing law of a contract between an issuing bank and a confirming bank is the place where the confirming bank carries on business. |
| Credit Agricole Indosuez v Banque Nationale de Paris | Court of Appeal | No | [2001] 2 SLR 1 | Singapore | Cited regarding the admissibility of surrounding circumstances in construing a letter of credit, but distinguished on the facts. |
| The Volvox Hollandia | N/A | No | [1988] 2 Lloyd’s Rep 361 | England | Cited for the caution with which claims for negative declarations must be viewed in conflicts of jurisdiction. |
| Sohio Supply Co v Gatoil (USA) Inc | Court of Appeal | No | [1989] 1 Lloyd’s Rep 588 | England | Cited regarding the disapproval of actions for negative declarations commenced to avoid proceedings in another jurisdiction. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Letter of Credit
- Forum Non Conveniens
- UCP 500
- Confirming Bank
- Issuing Bank
- Discrepancies
- Governing Law
- Stay of Proceedings
15.2 Keywords
- Letter of Credit
- Singapore
- South Korea
- Forum Non Conveniens
- Banking
- Mizuho
- Cho Hung
16. Subjects
- Conflict of Laws
- Banking
- International Trade
- Civil Procedure
17. Areas of Law
- Conflict of Laws
- Banking Law
- Civil Procedure
- International Trade Law