The Court of Appeal has handed down its judgment in NIDCO v Banco Santander. NIDCO had sought enforcement by way of summary judgment of four letters of credit worth over US38 million issued in its favour by Santander. Although ordered by Knowles J in the Commercial Court to pay NIDCO’s demands, the bank appealed, alleging that the High Court had applied the wrong test and that the demands made by NIDCO were fraudulent. The Court of Appeal dismissed the bank’s appeal, holding that even if the test applied in the Commercial Court was too lenient, there was no evidence to support the bank’s allegations of fraud in relation to the demands. The judgment clarifies the law as to the proper test to be applied on summary judgment applications by beneficiaries under letters of credit.
A copy of the judgment may be found here.
Anneliese Day QC of Fountain Court, leading Hugh Saunders of 4 New Square, represented NIDCO, instructed by Simon Tolson and Claire King of Fenwick Elliott LLP.
