Gian Singh & Co Ltd v Banque de L'Indochine

• Jurisdiction: Singapore
• Judge: Choor Singh J
• Judgment Date: 11 February 1972
• Neutral Citation: [1972] SGCA 1
• Date: 11 February 1972
• Docket Number: Civil Appeal No 13 of 1971
• Published date: 19 September 2003
• Defendant Counsel: AP Godwin and R Sharma (Donaldson & Burkinshaw)
• Court: Court of Appeal (Singapore)
• Plaintiff Counsel: J Grimberg (Drew & Napier)

The facts relevant for the determination of this appeal have been fully set out in the judgment of Choor Singh J but although I am in entire agreement with him that the trial judge ought, on all the evidence, to have held that the appellant had proved that the certificate in question was a forgery, I am unable to agree with him that the certificate produced to the negotiating bank in Taiwan was not in strict compliance with the condition stipulated in the letter of credit.

The condition is that there was to be produced to the negotiating bank in Taiwan `a certificate signed by Balwant Singh holder of Malaysian passport E13276 certifying that the vessel has been built according to specifications and is in fit and proper condition to sail. In the absence of such a certificate the letter of credit is not to be allowed negotiation`. The certificate that was produced to the bank in Taiwan was typed on the letter-head of the appellant and was in the following terms:

Reference to the letter of credit No 2693, US$45,000, issued by the Bank of Banque de L`Indochine Singapour, covering shipment of one fishing boat `M/V Wei Ching No 6` gross tonnage 80 tons, main engine five cylinders diesel engine, horsepower 220, built in wood.

I, Balwant Singh, holding the Malaysian passport no E13276, certify that the fishing boat had been inspected and built according to the specifications and in the fit and proper conditions to sail.

I, agreed Messrs Thai Lung Ship Machine Manufactory, no 51, Third Chung Cheng Road, Keelung, Taiwan to negotiate the letter of credit no 2693 without any objection.

Yours faithfully,

I, Balwant Singh,

Passport no E13276

Issued at 11 Nov 1964

GIAN SINGH & CO LTD

Sd Balwant Singh

Director.

It is settled law that where a letter of credit calls for the production of specific documents, its requirements in that regard must be exactly and strictly complied with, there being no room for any degree of inexactitude. The negotiating bank in Taiwan must therefore conform strictly to the instructions which it receives.

In the present case, it is necessary in the first place to determine what the condition stipulated in the letter of credit means exactly and having done so to determine whether the certificate produced to the negotiating bank in Taiwan complied exactly and strictly with the exact meaning of the condition. In my judgment the condition laid down in the letter of credit means exactly that the bank could only allow negotiation of the letter of credit if there is produced to the bank a certificate certifying that the vessel described in the letter of credit has been built according to the specifications and is in fit and proper condition to sail and which certificate is signed by a person whose name is `Balwant Singh` and who holds a Malaysian passport E13276.

The certificate that was produced to the bank contained everything that was required by the condition but in addition it was typed on a piece of paper which is a letter paper of the appellant and it had the words `Gian Singh & Co` and the word `Director` stamped on it by means of a rubber stamp. By reason of the letter-head and the additional stamped words appearing in the certificate, it is contended by the appellant that the certificate was not in strict and exact compliance with the condition stipulated by the appellant in the letter of credit. It is submitted that the letter-head and the additional words rendered the certificate that was produced to the bank a certificate of Gian Singh & Co Ltd and not the certificate of Balwant Singh. In my judgment, this argument is fallacious because the requirement is not the production of a certificate of Balwant Singh but the production of ` a certificate signed by Balwant Singh ` (the italics is mine). Looking at the certificate that was produced to the bank there can be no doubt at all that to the question `Is this certificate signed by Balwant Singh?` the answer must be in the affirmative. It seems to me that had the condition stipulated in the letter of credit required `a certificate signed by Balwant Singh in his personal capacity` there would be much force in the contention put forward on behalf of the appellant or, had the condition required `a certificate of Balwant Singh`, it would be difficult, having regard to the authorities referred to in the judgment of Choor Singh J to hold that the certificate produced to the bank complied strictly with the condition in the letter of credit.

In my opinion the condition stipulated in the letter of credit authorises the bank to allow negotiation if there is produced to the bank the requisite certificate signed by a person whose name is `Balwant Singh`, and who is the holder of Malaysian passport E13276. The condition, on its proper construction, does not and is clearly not intended to mean that the only acceptable and valid certificate is a certificate signed by Balwant Singh, holder of Malaysian passport E13276 in his personal capacity and in no other capacity. In other words, it is the identity of the person who is to certify which is of importance and this requirement must be strictly adhered to.

In my judgment the certificate that was produced complied exactly and strictly with the condition stipulated in the letter of credit and the bank conformed strictly to the instructions it received. Accordingly I am of the opinion that the trial judge was right in dismissing the appellant`s claim and I would dismiss the appeal with costs.

Tan Ah Tah J:

In this appeal which concerns, inter alia, the signature on a certificate which was produced to the defendant bank`s agent in Taiwan in connection with a letter of credit, it is contended by counsel for the plaintiff company that the signature which purported to be that of Balwant Singh was a forgery and that the trial judge erred in finding that the signature was not a forgery. It is abundantly clear from the surrounding circumstances that a fraud was perpetrated on the plaintiff company and that Balwant Singh was an innocent party in the transaction. In my view, the finding of the trial judge that the signature was not a forgery was against the weight of evidence. I have reached the conclusion that the plaintiff company has proved that the signature on the certificate was a forgery.

However, the fact that the signature on the certificate was not the genuine signature of Balwant Singh does not avail the plaintiff company as in the circumstances of this case the defendant bank`s agent in Taiwan, ie the paying bank was in no position to be aware of the forgery.

The crucial question to be decided in this appeal is whether the certificate which was tendered to the paying bank complied with the terms of the letter of credit.

One of the special conditions contained in the letter of credit was that there was to be produced to the paying bank in Taiwan `a certificate signed by Balwant Singh holder of Malaysian passport E13276 certifying that the vessel has been built according to specifications and is in fit and proper condition to sail. In the absence of such a certificate the letter of credit is not to be allowed negotiation`.

The certificate which was duly produced to the paying bank in Taiwan was typed on the letter-head of the plaintiff company and was in this form:

Reference to the letter of credit no 2693, US$45,000, issued by the Bank of BANQUE DE L`INDOCHINE Singapore, covering shipment of one fishing boat `M/V WEI CHING NO 6` gross tonnage 80 tons, main engine 5 cylinders diesel engine, horsepower 220, built in wood.

I, Balwant Singh, holding the Malaysian passport no E-13276, certify that, the fishing boat had been inspected and built according to the specification and in the fit and proper conditions to sail.

I, agreed Messrs Thai Lung Ship Machine Manufactory, no 51 Third Chung Cheng Road, Keelung, Taiwan to negotiate the letter of credit No 2693 without any objection.

Yours faithfully,

I, Balwant Singh,

Passport No E 13276

Issued at 11 November 1964

GIAN SINGH & CO LTD

Sd Balwant Singh

Director.

The name `Gian Singh & Co, Limited` and the word `Director` were stamped on the certificate by means of a rubber stamp. The signature `Balwant Singh` was in writing.

In the judgment of Choor Singh J a number of cases are referred to in which it has been laid down that the law requires strict and exact compliance with the stipulated conditions in a letter of credit. It is contended by counsel for the plaintiff company that the certificate does not comply with the special condition in this case in that the certificate although bearing the signature `Balwant Singh` should be regarded in law as the certificate of Gian Singh & Co Ltd and not that of Balwant Singh. In view of this argument put forward by counsel for the plaintiff company, it is necessary to remind oneself that the stipulated condition requires a certificate signed by `Balwant Singh holder of Malaysian passport E13276`. The reference to the passport number means that the certificate is to be signed by that particular person named Balwant Singh who is the holder of Malaysian passport E13276 and not any other person whose name happens to be Balwant Singh.

When the certificate and passport were produced to the paying bank in Taiwan it would have been clear and obvious, in the view of the officers of that bank, that the certificate had been signed by Balwant Singh holder of Malaysian passport E13276. In my opinion, the fact that the name `Gian Singh & Co Ltd` and the word `Director` were stamped on the certificate by means of a rubber stamp does not lead to the conclusion that the certificate was not signed by Balwant Singh holder of Malaysian passport E13276. It follows that there has been strict and exact compliance with the special condition contained in the letter of credit.

I would accordingly dismiss the appeal with...