Lloyd's Maritime and Commercial Law Quarterly
AUTONOMY—A NULLITY EXCEPTION AT LAST?
Beam Technologies
v. Standard Chartered Bank
Described by Donaldson J in The Bhoja Trader
1
as the “lifeblood of commerce”,2
it is well established that documentary credit transactions are separate from the underlying contract which the documentary credit seeks to finance. This doctrine of autonomy lies at the heart of documentary credit law.3
The general rule is that banks in a documentary credit transaction deal with only documents.4
Upon the presentation of conforming documents by the beneficiary, the confirming/negotiating bank must make payment to the
1. The Bhoja Trader
[1981] 2 Lloyd’s Rep 256.
2. Ibid
., 257.
3. See generally, R. Jack, A. Malek and D. Quest, Documentary Credits
, 3rd edn (2001), chs 3 and 4.
4. This position is enshrined in Art 3 and Art 4 of the Uniform Customs and Practice for Documentary Credits, 1993 Revision (“UCP 500”).
CASE AND COMMENT
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