National Infrastructure Development Company Ltd v Banco Santander SA

Practice – Summary judgment. The Commercial Court granted the claimant summary judgment on its claim for payment of its demand under the standby letters of credit. The defendant had argued that the law should develop to admit an exception for unconscionable conduct alongside the existing, recognised, fraud exception to the rule that such demands had to be paid by the issuing bank. The court held that the parties had chosen English law and that it was important to apply the law as it was. It held that what really mattered was the belief of the claimant and that it was not seriously arguable that the claimant did not honestly believe in the validity of the demands or that it did not believe that sums were due and owing. Accordingly, notwithstanding ongoing arbitration proceedings and an injunction granted by a court in Brazil, the sums claimed by the claimant had to be paid by the bank.

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