Mizuho Corporate Bank v Woori Bank: Letter of Credit Dispute over 51-Day Negotiation Clause

Mizuho Corporate Bank Limited sued Woori Bank in the High Court of Singapore, seeking payment under four letters of credit. The dispute centered on discrepancies in compliance documents and the interpretation of a '51 days clause' that restricted negotiation before a specified period. Assistant Registrar Vincent Leow granted summary judgment in favor of Mizuho, finding that Woori Bank could not refuse payment based on the alleged discrepancies or the breach of the 51 days clause.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Judgment for Plaintiff

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Mizuho Corporate Bank sued Woori Bank for payment under letters of credit. The court addressed discrepancies in documents and the interpretation of a 51-day negotiation clause.

1.7 Decision Date

8 April 2000

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Mizuho Corporate Bank Limited	Plaintiff	Corporation	Judgment for Plaintiff	Won	Toh Kian Sing of Rajah and Tann Ho Keng Hoong of Rajah and Tann
Woori Bank	Defendant	Corporation	Claim Dismissed	Lost	Tan Mei Yen of Drew and Napier LLC Sandrasegara Manoj Pillay of Drew and Napier LLC

3. Judges

Judge Name	Title	Delivered Judgment
Vincent Leow	Assistant Registrar	Yes

4. Counsels

Counsel Name	Organization
Toh Kian Sing	Rajah and Tann
Ho Keng Hoong	Rajah and Tann
Tan Mei Yen	Drew and Napier LLC
Sandrasegara Manoj Pillay	Drew and Napier LLC

4. Facts

Petaco agreed to purchase gas oil from Nissho Iwai.
Woori Bank opened four letters of credit in favor of Nissho Iwai at Petaco's request.
Mizuho Corporate Bank advised Nissho Iwai on the letters of credit and acted as the confirming and negotiating bank.
The letters of credit contained a '51 days clause' restricting negotiation before 51 days from the bill of lading date.
Nissho Iwai presented the compliance documents to Mizuho before the 51st day, and Mizuho gave value to Nissho Iwai.
Mizuho presented the compliance documents to Woori Bank on or after the 51st day.
Woori Bank refused to accept the compliance documents, citing discrepancies and breach of the 51 days clause.

5. Formal Citations

Mizuho Corporate Bank Limited v Woori Bank, Suit 1259/2003, SIC 1232/2004, [2004] SGHC 219

6. Timeline

Date	Event
2003-01-01	Suit filed (Suit 1259/2003)
2004-01-01	SIC 1232/2004
2004-09-23	Judgment issued

7. Legal Issues

Breach of Contract
- Outcome: The court held that while the plaintiff breached the 51 days clause, this breach did not entitle the defendant to refuse payment.
- Category: Substantive
- Sub-Issues:
  - Interpretation of contract terms
  - Breach of 51 days clause
- Related Cases:
  - [2004] SGHC 219
Compliance with Letter of Credit Terms
- Outcome: The court found that the alleged discrepancies in the compliance documents were minor, inconsequential, or invalid and did not justify the defendant's refusal to pay.
- Category: Substantive
- Sub-Issues:
  - Discrepancies in documents
  - Strict compliance vs. literal compliance
- Related Cases:
  - [1990] SLR 128
  - [1993] 1 SLR 141

8. Remedies Sought

Monetary Damages

9. Cause of Actions

Breach of Contract

10. Practice Areas

Commercial Litigation
Banking Litigation

11. Industries

Banking
Petroleum

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Bhojwani v Chung Khiaw Bank Ltd	Court of Appeal	Yes	[1990] SLR 128	Singapore	Cited for the principle that documents presented under a letter of credit must strictly conform with the requirements under the credit.
Equitable Trust Co of New York v Dawson Partners	N/A	Yes	[1926] 27 Lloyd’s LR 49	N/A	Cited to support the principle that business cannot proceed securely if strict compliance with letter of credit terms is not required.
Indian Overseas Bank v United Coconut Oil Mills Inc	Court of Appeal	Yes	[1993] 1 SLR 141	Singapore	Cited for the principle that strict compliance with letter of credit terms does not require literal compliance and that minor discrepancies can be disregarded.
Bankers Trust Co v State Bank of India	N/A	Yes	[1991] 2 Lloyd’s LR 443	N/A	Cited regarding the reasonable time requirement for rejection and return of compliance documents under UCP 500.
Credit Agricole Indosuez v Banque Nationale de Paris	Court of Appeal	Yes	[2001] 2 SLR 1	Singapore	Cited for the principles applicable to the construction of a letter of credit, including the admissibility of extrinsic evidence to show a special meaning of a term.
Reardon Smith Line Ltd v Yngvar Hansen-Tangen	N/A	Yes	[1976] 1 WLR 989	N/A	Cited for the principle that contracts should be interpreted in their surrounding circumstances.
Indian Bank v Union Bank of Switzerland	Court of Appeal	Yes	[1994] 2 SLR 121	Singapore	Cited for the definition of 'negotiation' in the context of letters of credit and the strict observance of deadlines for negotiation.
Trans Trust S.P.R.L. v Danubian Trading Co Ltd	N/A	Yes	[1952] 2 QB 297	N/A	Cited for the definition of 'condition precedent'.
Mount Elizabeth Health Center Pte Ltd v Mount Elizabeth Hospital Ltd	N/A	Yes	[1993] 1 SLR 1021	N/A	Cited for the definition of 'condition precedent'.
Computer Supermarkets (S) Pte Ltd v Goh Chin Soon Ricky and Others	N/A	Yes	[1997] 3 SLR 501	N/A	Cited for the definition of 'condition precedent'.
Ang Kim Leng v Koh Tze Kad	N/A	Yes	[1996] 3 SLR 41	N/A	Cited for the definition of 'condition precedent'.
Bestland Development Pte Ltd (in liquidation) v Manit Udomkunnatum	N/A	Yes	[1996] 3 SLR 92	N/A	Cited for the definition of 'condition precedent'.
Attica v Ferrostaal	N/A	Yes	[1976] 1 Lloyd’s LR 250	N/A	Cited for principles applicable to construing a clause as a condition precedent.
L. Schuler A.G. v Wickman Machine Tools	N/A	Yes	[1974] AC 235	N/A	Cited for principles applicable to construing a clause as a condition precedent.
Cutter v Powell	N/A	Yes	(1795) 6 Term Rep 320	N/A	Cited for principles applicable to construing a clause as a condition precedent.
Bayerische Vereinsbank v Bank of Pakistan	N/A	Yes	[1997] 1 Lloyd’s LR 59.l	N/A	Cited for principles applicable to construing a clause as a condition precedent.
Antaios Compania Naviera SA v Salen Rederierna AB	N/A	Yes	[1985] AC 191	N/A	Cited regarding the interpretation of contracts.
Lombard North Central Plc v Butterworth	N/A	Yes	[1987] QB 527	N/A	Cited regarding the interpretation of contracts.
Bunge Corp v Tradax Export SA	N/A	Yes	[1981] 1 WLR 711	N/A	Cited regarding the interpretation of contracts.
Barber v NWS Bank plc	N/A	Yes	[1996] 1 WLR 641	N/A	Cited regarding the interpretation of contracts.
BS & N Ltd v Micado Shipping Ltd	N/A	Yes	[2001] 1 Lloyd’s LR 341	N/A	Cited regarding the interpretation of contracts.
Hong Kong FIR Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd	N/A	Yes	[1962] 2 QB 26	N/A	Cited regarding the interpretation of contracts.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute Name	Jurisdiction
Uniform Customs and Practice for Documentary Credits (1993) ICC Publication No. 500	N/A

15. Key Terms and Keywords

15.1 Key Terms

Letter of credit
Negotiation
51 days clause
Compliance documents
Discrepancies
UCP 500
Reimbursement
Condition precedent

15.2 Keywords

Letter of credit
51 days clause
Negotiation
Banking
Singapore
Contract law

17. Areas of Law

Area Name	Relevance Score
Letter of Credit Law	90
Banking Law	80
Banking and Finance	75
Commercial Law	70
Contract Law	65

16. Subjects

Banking
International Trade
Contract Law