In Winson Oil Trading Pte Ltd v Oversea-Chinese Banking Corp Ltd and another suit[2023] SGHC 220, the General Division of the High Court of Singapore (High Court), in examining the fraud exception to an issuer's obligation to pay under a letter of credit, clarified that a beneficiary would be fraudulent if he made a false representation recklessly, not in the sense of carelessness, but in the sense of being indifferent to the truth. The High Court found, on the facts of this case, that the banks successfully made out the fraud exception. This marks one of the rare occasions where the fraud exception was successfully established by the banks, and clarifies that the fraud exception to letters of credit encompasses recklessness, and what that entails.
Our Tan Chee Meng SC, Tan Kai Yun, Andrew Pflug and Hudson Wong acted for Oversea-Chinese Banking Corporation Ltd, the successful defendant in Suit No 463 of 2020.
This update takes a look at the High Court's decision.
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