WJ Alan & Company Ltd v El Nasr Export & Import Co [1972] EWCA Civ 12 (03 February 1972)

WJ Alan & Company Ltd v El Nasr Export & Import Co [1972] EWCA Civ 12 (03 February 1972)

By accepting and drawing on the non-conforming letter of credit in sterling, the sellers either varied the contract or irrevocably waived their right to payment in Kenyan shillings. Payment under the confirmed, irrevocable letter of credit in sterling, once honoured, discharged the buyers' liability under the contract. The sellers cannot claim the difference caused by the devaluation of sterling.

Citation
[1972] EWCA Civ 12
Parties
Seller: W. J. Alan & Co. Ltd.; Buyer: El Nasr Export & Import Co.
Jurisdiction
England and Wales
Judgment Date
03 February 1972
Procedural Posture
Civil Appeal / Appellate
Outcome
appeal allowed
Legal Topics
Letters of Credit, Variation and Waiver of Contract, Currency of Account, Payment Under Sale of Goods Contracts, Effect of Devaluation on Contracts
Contract Law Commercial Law Banking Law Letters of Credit Variation and Waiver of Contract Currency of Account Payment Under Sale of Goods Contracts Effect of Devaluation on Contracts

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Parties

W. J. Alan & Co. Ltd.

Seller

El Nasr Export & Import Co.

Buyer

Procedural Posture

Civil Appeal / Appellate

Legal Issues

  1. 1 What was the currency of account under the contract of sale?
  2. 2 Did the acceptance of a non-conforming letter of credit in sterling constitute a variation or waiver of the original contractual requirement for payment in Kenyan shillings?
  3. 3 Does payment under a confirmed, irrevocable letter of credit discharge the buyer's liability under the contract of sale?

Ratio Decidendi

By accepting and drawing on the non-conforming letter of credit in sterling, the sellers either varied the contract or irrevocably waived their right to payment in Kenyan shillings. Payment under the confirmed, irrevocable letter of credit in sterling, once honoured, discharged the buyers' liability under the contract. The sellers cannot claim the difference caused by the devaluation of sterling.

Court Disposition

appeal allowed

Orders

  • Judgment entered for the defendants (buyers).
  • Sellers' claim for additional payment dismissed.