Voest-Alpine Trading Co. v. Bank of China

Bank of China (the defendant) issued a letter of credit to finance Jiangyin Foreign Trade Corporation’s (JFTC) purchase of goods from Voest-Alpine Trading USA Corporation (the plaintiff). The letter’s terms were subject to the Uniform Customs and Practice for Documentary Credits (UCP) 500. Additionally, the letter erroneously listed the beneficiary’s name as “Voest-Alpine USA Trading Corp.” and misspelled the destination port. The plaintiff shipped the goods and presented the documents specified in the letter of credit to the defendant. Subsequently, the defendant notified the plaintiff of several discrepancies between the letter of credit and the presentation documents. This included the inversion of “Trading” and “USA” in the beneficiary’s name; an additional misspelling of the destination port; and the addition of a “3” in the letter-of-credit number listed in one location in one of the documents. The defendant also represented that it was contacting JFTC to see if they wished to waive the discrepancies. Later, the defendant returned the documents to the plaintiff and refused to honor the letter of credit. The plaintiff sued.