ALYK (H.K.) Limited v Caprock Commodities Trading Pty Limited and Anor [2012] NSWSC 1558

Supreme Court New South Wales

Medium Neutral Citation: ALYK (H.K.) Limited v Caprock Commodities Trading Pty Limited and Anor [2012] NSWSC 1558 Hearing dates: 5 October 2012 Decision date: 13 December 2012 Before: Slattery J Decision: Permanent injunction not granted. Interlocutory injunction dissolved. But orders stayed until 5.00pm on Wednesday, 19 December 2012 at 5.00pm. Proceedings otherwise dismissed. Submissions invited in relation to any special orders for costs. Catchwords: CONTRACT - contract for the sale and shipment of iron ore fines over three years - the plaintiff purchaser arranges a standby letter of credit (standby LC) from the second defendant Bank pursuant to the contract - the first defendant vendor calls on the standby LC - whether the first defendant has a right to make demand under the standby LC - whether the contract between the plaintiff and the first defendant contains an implied negative stipulation limiting the circumstances in which the first defendant may call upon the standby LC - whether the plaintiff may restrain the second defendant bank's payment under the standby LC to the first defendant HELD:- the first defendant may make demand on the standby LC - the sale and shipment contract does not contain an implied negative stipulation limiting the first defendant's capacity to call on the standby LC Cases Cited: Barclay Mowlan Construction Ltd v Simon Engineering (Australia) Pty Limited (1991) 23 NSWLR 451 BP Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266 Clough Engineering Ltd v Oil and Natural Gas Corporation Ltd [2008] FCAFC 136 Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 Fletcher Constructions Australia Ltd v Varnsdorf Pty Ltd [1998] 3 VR 812 Lucas Stuart Pty Limited v Hemmes Hermitage Pty Limited [2010] NSWCA 283 Olex Focas Pty Ltd v Skodaexport Co Ltd [1998] 3 VR 380 Reed Construction Services Pty Ltd v Kheng Seng (Aust) Pty Ltd (1999) 15 BCL 158 Rejan Constructions Pty Limited v Manningham Medical Centre Pty Limited [2002] VSC 579 Toll (FGCT) Pty Limited v Alphapharm Pty Limited (2004) 219 CLR 165 Urquhart Lindsay & Co Ltd v Easter Bank Ltd [1922] 1 KB 318 Wood Hall Ltd v The Pipeline Authority (1979) 141 CLR 443 Texts Cited: Schmitthoff, Law and Practice of International Trade, 12th Edition, 2012, Thomson Reuters, London Category: Principal judgment Parties: Plaintiff: ALYK (H.K.) Limited First Defendant: Caprock Commodities Trading Pty Limited Second Defendant: China Construction Bank Corporation Representation: Plaintiff: J. Hogan-Doran First Defendant: A. Stewart Second Defendant: J. A. Steele Plaintiff: Greg Couston, Middletons First Defendant: Danella Wilmshurst, HWL Ebsworth Second Defendant: David Benjamin Goldman, Norton Rose Australia File Number(s): 2012/280396 Publication restriction: No