MASTER FEEDS LTD,. V. PEOPLE?S BANK

MASTER FEEDS LTD,. V. PEOPLE'S BANK

SUPREME COURT
AMARATUNGE, J.
EKANAYAKE, J. AND
PRIYASATH DEP., PC. J.
S. C. (CHC) NO. 11/2002
H.C. CIVIL 150/98(1)
AUGUST 29, 2011

Letters of Credit - Questions of fact - Question of law - Prescription

The plaintiff, a banking corporation, at the request of the Defendant issued three irrevocable letters of credit to the defendant to facilitate its imports. The Defendant collected the documents related to the letters of credit sent by the exporter's bank (seller's bank) from the Plaintiff Bank and got the goods released from the shipper. The Defendant having obtained the release of goods, failed and neglected to pay monies due to the Plaintiff Bank contrary to the terms and conditions of the agreements relating to the issuing of the letters of credit.

As the Defendant failed to pay the amounts due under the three letters of credit, the Plaintiff Bank instituted this action against the Defendant.

The Defendant in its answer admitted inter alia that he was a customer of the Plaintiff-Bank and was granted banking facilities. The Defendant also averred that the plaint does not disclose a cause

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