Judicial Remedy Of Fraud In Letter Of Credit

Letter of credit plays an important role in today's sale of goods across internationalborders. But meanwhile, there is more and more fraud in the transaction with the letterof credit; this of course will damage the interests of the bank or the seller in suchtransaction. So, judicial remedies against fraud become necessary.This article includes one preamble, four chapters and one conclusion section, there isabout 51,000 words in total, in which 36,000 is the main body.Preamble: The preamble mainly introduce the general concepts regarding letters ofcredit, fraud of letters of credit, and judicial remedy of fraud of letters of credit, thecurrent theories and practices in China, and explained the value of research in thisarea.Chapter I: This chapter introduces the conceptions and characteristics of fraud in letterof credit and judicial remedy as well as the necessity of applying such remedy onfraud in letter of credit. This chapter also briefly introduced the historicaldevelopment phases of the judicial remedies of the fraud of letters of credit, inconclude that they can be divided into three phases, including the "pay first and suelater" phase, "conditional recognition of judicial remedy" phase, and "strictly limitingthe judicial remedy" phase.Chapter II: This chapter introduces the various theories regarding the judicial remedyof the fraud of letters of credit, such as "no court intervention theory", "fraudexception theory", and "the exemption of fraud exception theory". Each theory's basic contents, background, and merits and demerits are also discussed. Chapter III: The chapter introduces the practice of judicial remedies in detail, including various aspects of the judicial remedy for fraud in letters of credit, such as the methods, the determination of existence of fraud, the pre-conditions of granting judicial remedies, etc. In the analysis, the common grounds and the difference between Common Law system and Continental Law system in this regard was also compared and commented.Chapter IV. This chapter first introduced the current status of China's legislation regarding the judicial remedies for the fraud in letters of credit, then, major shortcomings and flaws in Chinese legal system concerned with the prevention of fraud in letter of credit are pointed out, the article also commented on the latest draft of judicial interpretation by the Supreme Court, based on which various reform suggestions are made.Conclusion: The conclusion section summarized the main points of this paper in an nut shell.