Petrosaudi Oil Services (Venezuela) Ltd (a body corporate) V Novo Banco S.A. and Others

Contract – Payment. The Commercial Court held in favour of the second defendant company in a dispute as to whether payments should be made by the first defendant bank following the decision of an arbitral tribunal in a dispute over the rate of payment for drilling work done by the claimant company. The court held that, among other things, the claimant had been fraudulent within the meaning of the so-called 'fraud exception' (the fraud exception) to the 'autonomy principle' of the law of documentary credits, which provided for payment to be made pursuant to a documentary credit following a compliant presentation as a separate contract, unaffected by any dispute between the parties to the underlying contract.

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