ASSN, Ffop & IN THE SUPREME COURT OF JUDICATURE COURT OF APPEAL (CIVIL DIVISION) ON APPEAL FROM THE HIGH COURT OF JUSTICE QUEEN’S BENCH DIVISION COMMERCIAL COURT (MR_JUSTICE SAVILLE) Royal Courts of Justice Wednesday 28th October 1992 Before: LORD JUSTICE LLOYD LORD JUSTICE STUART~SMITH LORD JUSTICE BELDAM SEACONSAR_FAR EAST LIMITED ve BANK_MARKAZI_JOMHOURI_ ISLAMI IRAN (Body Corporate) (Transcript of The Association of Official Shorthandwriters Limited, Room M104, Royal Courts of Justice, and 2 New Square, Lincoln’s Inn, London, WC2A 3RU.) MR ANTHONY CLARKE Q.C. and MR SIMON RAINEY, instructed by Messrs Clyde & Co., appeared for the Appellants (Plaintiffs). MR NICHOLAS CHAMBERS Q.C. and MR MARK HAPGOOD, instructed by Messrs Stephenson Harwood, appeared for the Respondents (Defendants) . JUDGMENTASSN, 7 LORD JUSTICE LLOYD: In this case we have been concerned with the course of business under a commercial letter of credit. By a contract dated 30th June 1986 the plaintiffs agreed to sell a large quantity of artillery shells to the Iranian Ministry of Defence. The total price was $193M. Payment was to be made by letter of credit. n 15th January 1987 the defendants opened an unconfirmed letter of credit in favour of the plaintiffs. It provided for payment at the counter of Bank Melli Iran in London against presentation of documents. On 29th September 1987 the plaintiffs shipped the first instalment of goods from Setubal, Portugal. The invoice value was $3.1M, less 9 per cent retention. By letter dated 30th September 1987 the plaintiffs remitted a full set of documents. They arrived on 1st October Bank Melli carried out the usual checks. They identified certain discrepancies. As a result there was a meeting on Monday 5th October at Bank Melli‘s offices between Mr Appiano of the plaintiffs and Mr Mansouri of Bank Melli. There is a dispute as to what was said at that meeting. One thing is clear. Bank Melli never paid against the documents. Nor did Bank Markazi. On ist December 1987 the plaintiffs shipped another consignment of goods. This time the invoice value was $4.526M, less 9 per cent retention. The documents were remitted the same day, and received by Bank Melli on 3rd December. Once again the documents were checked and found to contain discrepancies. On 8th December Bank Melli sent a telex to the plaintiffs, listing the discrepancies, and informing the plaintiffs that the documents were held at the plaintiffs’ disposal. Although the telex was sent to the address indicated in the plaintiffs’ covering letter, it appears that the plaintiffs had changed their 2(d telex number without informing Bank Melli. As a result the plaintiffs did not receive a copy of the telex until it was handed over at a meeting on 10th December, attended, as before, by Mr Appiano and Mr Mansouri. Thereafter Bank Melli telexed Bank Markazi requesting authority to pay against the documents, notwithstanding the discrepancies. They received no reply. The two consignments have presumably arrived in Iran. But the plaintiffs have never been paid. The balance of the contract has been cancelled. In those circumstances the plaintiffs commenced proceedings against Bank Markazi in respect of both presentations. They were granted leave ex parte to serve out of the jurisdiction by Hobhouse J. On the inter partes hearing Saville J. set aside leave in respect of the second presentation, but upheld leave in respect of the first presentation. On the second presentation he held that the plaintiffs’ case was insufficiently strong on the merits. The plaintiffs now appeal against Saville J.’s decision in respect of the second presentation, and the defendants cross-appeal in respect of the first presentation. The Appeal It is common ground that the plaintiffs’ claim falls within one or other of the heads of R.S.C. Order 11, rule 1. It is also common ground that England is an appropriate forum. The plaintiffs would say that it is clearly the most appropriate forum. The case thus turns on whether, as the evidence stands, the plaintiffs have established a sufficiently strong case on merits. There were two matters for the judge to consider on the merits; first, whether the documents conformed to the credit, and secondly whether the telex of sth December was a valid rejection. 3ASSN. i Regrettably the judge did not give a formal judgment. We only have a note of various issues which he decided as the argument proceeded, and other issues on which one side or the other was stopped. As to the second question he held that the telex was a valid rejection, and that the contrary was unarguable. As to the first question, he held that the plaintiffs had failed to establish on the balance of probabilities that the documents conformed with the contract. Mr Clarke, for the plaintiffs argues that this was to impose too high a standard of proof at the interlocutory stage. Mr Chambers does not argue the contrary. The explanation for the judge’s error must be that he misunderstood something said by the Court of Appeal in Attock Cement Co. Ltd. v. Romanian Bank for Foreign Trade [1989] 1 W.L.R. 1147, In that case Staughton L.J. said at 1155: “Save in the speech of Lord Tucker [in Vitkovice Horni a Hutni Tezirstvo v. Korner [1951] A.C. 869], which deals with a special problem, I cannot find in the decision any express consideration of the balance of probability. Nevertheless I conclude that, where there is a disputed question of fact which is essential to the application of R.S.C., Ord. 11, r.1, the judge must reach a provisional or tentative conclusion that the plaintiff is probably right upon it before he allows the service to stand. The nettle must be grasped, and that is what I take to be meant by a good arguable case". But that case was concerned with the standard of proof required to bring a case within one of the heads of Order XI, rule i, It does not touch directly on the merits. In Overseas Union Insurance Ltd. v. Incorporated General Insurance Ltd. [1992] 1 Lloyd’s Rep. 439 Gatehouse J. made the same mistake as Saville J. But his mistake was corrected by the Court of Appeal at page 442. Since Saville J. applied the wrong standard of proof in relation to one of the matters which he had to consider in exercising his discretion, it is clear, as Mr Chambers concedes 41a that his decision cannot stand, and we must exercise our discretion afresh. Did the documents conform? I start with the letter of credit. It is contained in a telex dated 15th January 1987 from Bank Markazi in Iran to Bank Melli in London. So far as relevant it reads: "This telex is to be considered as our credit instrument and is subject to Uniform Customs and Practice for Documentary Credits 1983 Revision I.C.c. Publication No. 400. At the request of Deputy Ministry of Defence for Logistics of IRI we open our irrevocable L/C No. 106808/4 in favour of M/S: Seaconsar Far East Ltd. 8th Floor Printing House Central Hong Kong for the sum of not exceeding U.S. Dollars 18,600,000.-(for value) valid until March 17-88 at the counter of Bank Melli Iran, LDN covering special equipments as per contract No. 11/284 DD.30-6-86 and its relevant addendum No. 1. Available by sight payment at the counter of Bank Melli Iran London against presentation of the original set of the following docs: Signed commercial invoice in 4 copies... Full set of clean on board B/L marked freight collect issued or endorsed to our order... Certificate of origin in 4 copies issued by the local Chamber of Commerce confirming goods originated in France... Packing list in 4 copies Inspection certificate of goods issued by [the beneficiary as] manufacturer who will be advised you later on and confirmed by orderer’s rep. Certificate of quality and perfect performance of goods issued by quality control department of manufacturing company. Delivery schedule will be advised you later on. Process verbal of goods confirmed by orderer’s authorized rep. who will be fully identified later on. Kindly notify the beneficiary accordingly. Other conditions: Only 91 per cent of the value of each cargo is payable against presentation of relevant required documents. The remaining 9 per cent is kept as good performance guarantee...(3 Please debit our account for payment. Our LC No. and our principal’s name should appear on all documents and packages..." The documents were, as I have said, received on 3rd December. They were checked on 3rd and 4th December. The Document Checking Record shows four discrepancies. We are only concerned with one. It relates to the Proces Verbal. It was a requirement of the credit that all the documents should bear the letter of credit number and the name of Bank Markazi’s principal that is to say, the Deputy Ministry of Defence for Logistic. The Proces Verbal reads: "We certify, that: 7,300 pieces of ‘SPECIAL EQUIPMENT’ Shipped [on] the M-V ‘IRAN NAHAD’ are on board and in accordance with [the] terms of contract no. 11/284 dated 30th June 1987." It is signed by Mr Mohammad Eskandari, who, as appears from an amendment to the letter of credit, was the "orderer’s representativ: It is also signed by the plaintiffs. But it does not bear the letter of credit number and it does not bear the name "Deputy Ministry of Defence for Logistic", as do all the other documents, such as the Certificate of Inspection and the Certificate of Quality, in the top right-hand corner. Curiously the checkers failed to notice a further discrepancy, that the Proces Verbal refers to a contract dated 30th June 1987 instead of 1986. But nothing now turns on that discrepancy. There is no dispute between the parties as to the doctrine of strict compliance, and the reasons for it. They are to be found in the speech of Viscount Sumner in Equitable Trust Company of New York v. Dawson Partners, Itd. (1926) 27 Lloyds List Reports 49, and the judgments of Parker J. and Sir John Donaldson 6ASSN. 4 M.R. in Banque de 1’Indochine et de Suez S.A. v. J.H. Rayner (Mincing Lane) Ltd [1983] 1 Q.B. 711. It is no good asking why the credit required the letter of credit number and the buyer's name to appear on each of the documents. As Lord Diplock said in Commercial Banking Co. of Sydney Ltd v. Jalsard Pty. Ltd. (1973] A.C. 279 at 286: "The banker is not concerned as to whether the documents for which the buyer has stipulated serve any useful commercial purpose or as to why the customer called for tender of a document of a particular description. Both the issuing banker and his correspondent bank have to make quick decisions as to whether a document which has been tendered by the seller complies with the requirements of a credit..." Mr Clarke relies on the observation of Parker J. in the Banque de 1’Indochine case at page 721: "I accept...that Lord Sumner’s statement cannot be taken as requiring rigid meticulous fulfilment of precise wording in all cases. Some margin must and can be allowed..." He argues that the absence of the letter of credit number and the buyer’s name was an entirely trivial feature of the document. I do not agree. I cannot regard as trivial something which, whatever may be the reason, the credit specifically requires. It would not, I think, help to attempt to define the sort of discrepancy which can properly be regarded as trivial. But one might take, by way of example, Bankers Trust Co. v. State Bank of [1991] 2 Lloyd’s Rep. 443 where one of the documents gave the buyer’s telex number as 931310 instead of 981310. The discrepancy in the present case is not of that order. Mr Clarke further argues that the discrepancy, even if it cannot be regarded as trivial, can be cured by reference to the other documents, such as the Certificate of Inspection and the Certificate of Quality, with which it is clearly linked. Again he relies on a sentence of Parker J. in the Banque de 1’Indochine 7[o- case at p. 721 where he said: "I have no doubt that so long as the documents can be plainly seen to be linked with each other, are not inconsistent with each other or with the terms of the credit, do not call for inquiry and between them state all that is required in the credit, the beneficiary is entitled to be paid". But in that case Parker J. was dealing with an argument that the tender was bad because some of the documents could not be linked with each other. He was not saying that a deficiency in one document could be cured by reference to another. It was held by the Court of Appeal that linkage, as such, was not necessary provided each of the documents referred unequivocally to the goods. Here, by contrast, there is an express requirement that the documents should be linked in the sense that each of them should contain the letter of credit number and the name of Bank Markazi‘s principal. Whatever the reason for this. the requirement is clear. I do not see how Bank Melli could ignore that requirement. It may be that the Proces Verbal in fact related to the same goods, and that one can see this by inference from the other documents. But the absence of the letter of credit number and the name of Bank Markazi’s principal on the Proces Verbal called for some explanation. The bank was therefore entitled to reject. It is an odd feature of the case that the Proces Verbal was never amended, as other documents were, and as it could have been at any time up to the expiry of the credit on 17th March 1988. But the fact is that it never was. To hold that it is even arguable that the documents as presented were a valid tender under the credit would, I suspect, cause surprise among bankers and risk upsetting the ordinary course of business. In my judgment the tender was clearly bad.ASSN. Ue Was there a valid rejection? I turn to the telex of 8th December. The judge held that it was plainly a rejection of the documents on the ground that they did not conform to the credit, and that the contrary was not arguable. I agree. I can give no other meaning to the words “documents held by us at your risk and disposal". It is to be noted that the plaintiffs themselves treat the telex as a rejection in their points of claim. So does the affidavit sworn on behalf of the plaintiffs for the purpose of obtaining leave to serve out. Mr Clarke argues that in the light of the conversations which took place between Mr Appiano and Mr Mansouri on 5th October and again on 10th December, the telex should be regarded as not meaning what it clearly says. There is little evidence as to what took place at the meeting on 10th December. I shall return later to the meeting on 5th October when I consider the cross-appeal. At this stage I would only say that in my judgment it is not even arguable that the context and background on which Mr Clarke relies could affect the plain meaning of the telex. It is of course very common for discussions to take place between the parties after the documents have been rejected to see if the buyer is willing to waive any discrepancies. That would explain Bank Melli’s telexes of 11th December 1987 and 6th January 1988 in which they ask Bank Markazi whether they may pay against the documents notwithstanding the stated discrepancies The telexes are entirely consistent with the documents having already been rejected. Mr Clarke advanced a further argument that Bank Melli, as advising or "nominated" bank (to use the language of Article 11 of the Uniform Customs and Practice) had no authority to reject 9ASSN, the documents. According to Mr Clarke, Bank Melli had authority to pay against the documents if they conformed, and authority not to pay if they did not conform, but no authority to reject. I suppose it would be theoretically possible to draw a distinction between not taking up the documents, and rejecting them. But there is no hint that such a distinction has ever been drawn before, whether in any reported case or in any of the textbooks: and in practice it would defeat or prejudice an important objective of commercial credits, which is that documents should be taken up or rejected promptly. They should not be left in limbo. I would therefore have been astonished if there had been evidence in the present case that Bank Melli had authority to take up the documents if they conformed but not to reject them if they did not. In fact the evidence is the other way. There is an affidavit from Mr Mansouri of Bank Melli which describes the relationship between the two banks. In paragraph 7 he says: “Where a Markazi credit requires documents to be presented at the counters of Melli, it is Melli which carries out the first process, namely examination of the documents. This appears to be accepted by the Plaintiffs. As regards the second process, both Melli and Markazi have always acted on the basis that Melli’s authority to pay against conforming documents carries with it the authority to reject discrepant documents". This is exactly what I should have expected. Mr Abdollah Emadi-Allahyari, a director of the Foreign Exchange Transactions Department, makes the same point on behalf of Bank Markazi. The fact that Bank Melli have not been able to produce a document in which the agency is spelt out in terms is beside the point. Many agencies are created by long continued course of business, as was the agency in the present case. The only evidence the other way is the affidavit of Mr Appiano. In paragraph 7 he says 10is "Mr Mansouri made it clear during our conversation that he was not purporting to speak on behalf of the Bank Markazi which was the issuing bank and the only party competent to take up the documents and effect payment..." If this means that Bank Melli had no authority to waive the discrepancies, then it is understandable and no doubt correct. But if it means that Bank Melli had no authority to reject the documents in the meantime, then I find it frankly incredible. Mr Clarke’s last argument on authority turns on Article 16 of the Uniform Customs. Even if, contrary to his argument, Bank Melli would have had authority to reject the documents if the Uniform Customs had not been incorporated, nevertheless the effect of Article 16 is, he says, to exclude such authority. I need not repeat the terms of Article 16 verbatim. Paragraphs (b)-(f) set out the obligation of the issuing bank to examine the documents and to determine, on the basis of the documents alone, whether to take them up or refuse them. If the issuing bank decides to refuse the documents it must do so without delay. There is nothing in Article 16 which entitles any bank other than the issuing bank to refuse the docunents. Therefore, says Mr Clarke, the authority of Bank Melli to refuse the documents is expressly, or at any rate by implication, excluded. He prays in aid the judgment of Saville J. who observed that the Uniform Customs did not confer on Bank Melli, as advising bank, the authority to reject on behalf of Bank Markazi. I do not accept Mr Clarke’s argument. It may be the case that the Uniform Customs do not positively confer authority on the advising bank to reject the documents. But where authority is conferred dehors the Uniform Customs, there is nothing in Article 16 to negative such authority. It is curious - as Mr 11{q Raymond Jack Q.C. points out in his book on Documentary Credit at page 84 - that Article 16 nowhere refers to the confirming bank. Yet the Article, if it is to make sense in the case of a confirmed credit, must apply to the confirming bank in the same way as it applies to the issuing bank, even though the confirming bank is not mentioned. Similarly it must apply to the advising bank in the case of an unconfirmed credit, where the advising bank has been authorised to pay, and is therefore "nominated bank" under Article 16(b). Mr Clarke argued that in every case where an unconfirmed credit is subject to the Uniform Customs it is necessary to confer express authority on the nominated bank to reject non-conforming documents, and to secure the consent of the beneficiary for that purpose. I cannot agree. A decision to that effect would, I suspect, cause great concern. The lacuna in Article 16 (for that is all it is) does not compel us to reach so inconvenient a result. Was the rejection in time? The final argument on the merits is that the rejection on 8th December was not in time. The plaintiffs accept that the documents were not received until Thursday 3rd December, and that Bank Melli was entitled to five working days in which to check the documents. Allowing for the weekend, a telex sent on 8th December was clearly in time. Unfortunately the telex was sent to a number which the plaintiffs no longer used, although it was the number shown on the plaintiffs’ letter of 1st December 1987 and all their correspondence. However Mr Appiano was told that the rejection telex had been sent in the course of a telephone conversation with Mr Mansouri on 9th December, and he received a copy at the meeting on Thursday 10th December. If Bank Melli were entitled to five working days in which to check the 12oo documents the telex received on Thursday 10th December would have been just in time. But in any event the plaintiffs had notice of the rejection on 9th December, which was clearly in time. It is therefore unnecessary to consider the effect of the plaintiffs having misled Bank Melli as to the correct telex number. That deals with all Mr Clarke’s arguments on the merits in relation to the second presentation. I conclude that the plaintiffs have shown (i) that the claim comes within Order 11, rule 1 (this was common ground) and (ii) that England is clearly the appropriate forum, But they have failed to show a good arguable case on the merits. Applying the traditional approach, therefore, I would reach the same result as Saville J., and set aside leave. But Mr Clarke has a further argument. It was introduced by an amendment of the original grounds of appeal. Paragraphs 4 and 5 now read: "(4) That the Learned Judge should have held that the requirement that a Plaintiff has to show a good arguable case on the merits of his substantive claim requires only that the Plaintiff, once he has established that England is the appropriate forum for his claim, establishes a claim worthy of consideration by the Court. (5) That the Learned Judge should have held that the standard to be applied in relation to the requirement of a ‘good arguable case’ under RSC Order 11 is the same as that laid down by the Court of Appeal in Overseas Union Insurance v. Incorporated General Insurance". This is the fifth case in as many years in which the Court of Appeal has considered the principles which ought to govern the exercise of the court’s discretion under Order 11, rule 4(2) in those cases where the claim falls within one or other of the heads of Order 11, rule 1. In each of the previous cases the court has been guided by the decision of the House of Lords in vitkovice Horni a Hutni Tezirstvo v. Korner [1951] A.C. 869. 134i Although the test of "good arguable case" owes its origin to the argument of Sir Andrew Clark in that case, and its adoption by Lord Simonds at page 880 and by Lord Radcliffe at pages 884-885 where he treats "strongly arguable" and “good case for argument" as synonymous, it has now been shown that, with the exception of Lord Tucker, and possibly Lord Oaksey, the House of Lords were in that case concerned exclusively with the question of jurisdiction. I have not been able to discover when good arguable case was first used in relation to the merits. But it had already become the established test by the time of the decision of the Court of Appeal in Metall und Rohstoff A.G. v. Donaldson Lufkin & Jenrette Inc. [1990] 1 Q.B. 391, and probably long before. In Metall und Rohstoff Slade L.J. said by way of elucidation: “While the court cannot at this stage determine whether the plaintiff, if given leave, will succeed, it must be satisfied that the plaintiff has a good chance of doing Mr Clarke accepts that good arguable case is the correct test on the merits, but argues that it means no more than a case which merits consideration, and that this is "a very low and an intentionally low threshold". The purpose of the exercise in relation to the merits is, he said, "the identification of plainly hopeless cases". I profoundly disagree. In the first place, a threshold which was intended only to exclude the unarguable, would never have been described as a good arguable case. The question would have been whether the case was arguable, not whether it had a good chance of success. Secondly, to set the threshold as low as Mr Clarke suggests would be to disregard numerous statements of the highest authority that the jurisdiction under Order 11 14ASSN. Lk ought to be exercised with caution. To require a foreigner to answer a claim in our courts it is not enough that the claim, if sound, can conveniently, or most conveniently be tried in England. Nor is it enough that the conditions of order 11, rule l are satisfied. The claim itself must be of a certain strength. Traditionally the standard has been set as a good arguable case. I can see no justification for lowering that standard, just because the court is persuaded that the other matters which fall for consideration on an application for leave to serve out have been fulfilled. I respectfully agree with the observation of Mustill L.J. in Societé commerciale de Reassurance v. Eras International Ltd. [1992] 1 Lloyd’s Rep. 570 at 588 that the stages of what he calls the three-stage enquiry are linked. This is most obvious in the case of contract, where the ground for bringing the case within Order 11 is that the contract was made (or broken) within the jurisdiction, and the defence on the merits is that the defendant never entered into any contract at all. In such a case the existence of the contract is relevant both to jurisdiction and to merits. Clearly the standard of proof must be the same for both purposes. But in other cases the issues which go to jurisdiction and the issues which go to the merits may be distinct. This explains how Lord Tucker in Vitkovice Hor Korner was able to agree with Lord Radcliffe as to the principles to be applied in granting leave under Order 11, and yet hold that the cogency of the evidence may vary with regard to the different matters which fall for consideration. Failure to appreciate that some issues may go to more than one element in the three- stage enquiry may have led to some misunderstanding of what was actually decided in Korner’s case. 15ad I also agree with Mustill L.J. that "good arguable case" is a flexible concept, which is not to be applied rigidly, or over- analysed. But neither the flexibility of the concept, nor the linking of the three stages, justifies us in lowering the standard which has hitherto been required of the plaintiffs, if they are to establish a good arguable case on the merits. What then are the authorities on which Mr Clarke relies? The first is Overseas Union Insurance Ltd v. Incorporated General Insurance Ltd, [1992] 1 Lloyd’s Rep. 439. In that case Parker L.J. held at page 445 that the plaintiffs had established a good arguable case on the merits. But he went on to analyse the speeches in Korner’s case. At 448 he said: “As to standard of proof, Lord Oaksey’s view must, as it seems to me, be right. Suppose for example that it is common ground between the parties, or there is overwhelming evidence that, if the case is to be tried at all, England is the appropriate forum and that, on the merits, the plaintiffs’ case is worthy of serious consideration, I can see no reason why he should be forced to have his action for breach of contract tried in an inappropriate forum because e.g. his contention that the contract was governed by English law does not persuade the Judge that that is probably the case, or that there is a strong probability that that is the case". As to that paragraph I would comment as follows: {1) In holding that the plaintiffs need not show a probability that the case comes within one of the heads of Order 11, Parker L.J. was departing from the unanimous decision of the Court of Appeal in the Attock Cement Co. case. (2) Parker L.J.’s reliance on Lord Oaksey’s speech is open to question, since that speech cannot be reconciled with the other speeches in Korner’s case. Lord Oaksey said: "Even if there were only the slightest evidence as to the breach of the pensions agreement having been committed within the jurisdiction, the evidence as to forum conveniens is, in my opinion, such as to make it sufficiently to appear that the case is a proper one for service out of the jurisdiction". 16a Lord Oaksey was alone in thinking that the slightest evidence could ever suffice to bring the case within one of the heads of Order 11, rule 1. (3) If the paragraph is to be taken as lowering the traditional standard of proof in relation to the merits, then it was obiter. Parker L.J. had already decided in favour of the plaintiffs on the ground that they had a good arguable case. (4) Mann L.J. decided the case on the basis that the plaintiff must show a good arguable claim on the merits. Though he agreed generally with Parker L.J., he did not associate himself with the concluding part of Parker L.J.’s judgment The other authority on which Mr Clarke relied is Banque Paribas v. Cargill International S.A. [1992] 2 Lloyd’s Rep. 19 In that case Parker L.J. summarised the plaintiffs’ case on the merits by holding that it was "worthy of consideration", an expression which he culled from Lord Tucker’s speech in Korner’s case. But it is clear from the context that Parker L.J. did not regard the expression as being synonymous with arguable. This is because he had already held that the plaintiffs’ case was arguable. He then went on to consider whether it was sufficiently arguable to make it proper to give leave to serve out. He held that it was. There is, therefore, no reason to suppose that in using the expression, "worthy of consideration" Parker L.J. was intending to lower the standard, or to depart from what Slade L.J. had said in the passage which I have already quoted from Metall und Rohstoff, a passage which Parker L.J. had himself quoted in the earlier part of his judgment. If Parker L.J. had been intending to depart from Slade L.J.‘s formulation, no doubt Sir Christopher Slade, who was a party to the decision would have added a judgment of his own. 17ASSN. BB My conclusion is that good arguable case on the merits, or good chance of success, should continue to be used as the standard for granting leave to serve out of the jurisdiction. If "worthy of consideration" means the same as good arguable case, there is no problem, except that I can see no good purpose in substituting different language to describe the same concept. If, on the other hand, it was intended to lower the threshold, so as to exclude only the plainly hopeless case, as Mr Clarke contends, I would respectfully dissent. on the facts I would hold that, so far as the second presentation is concerned, the plaintiffs have failed to show a good arguable case on the merits. But if I am wrong about the threshold, I would if necessary hold that the plaintiffs had failed to show that their claim is worthy of consideration. Cros: ppeal I can deal with the cross-appeal very shortly. Mr Chambers argued that Saville J. should have set aside leave in relation to the first presentation. But the facts of the first presentation were different in a crucial respect. Bank Melli never sent a telex of rejection. The defendants rely instead on an oral rejection by Mr Mansouri at the meeting with Mr Appiano on Sth October. Since there is a dispute as to what occurred at that meeting, Saville J. was entitled to hold that the plaintiffs have at least a good arguable case that the documents were never rejected, or were not rejected in time, in which case the defendants are precluded from arguing that the documents did not conform: see Article 16(e). Mr Chambers has an alternative argument. He submits that time never began to run against the defendants, since the documents were never remitted by Bank Melli to Bank Markazi. In 18ASSN, && other words, Bank Markazi had a second opportunity to take up or refuse the documents when Bank Melli failed to take them up on Sth October. He relies on Article 16(d), which provides: "If the issuing bank decides to refuse the documents, it must give notice to that effect without delay by telecommunication or, if that is not possible, by other expeditious means, to the bank from which it received the documents (the remitting bank), or to the beneficiary, if it received the documents directly from him". If I have understood the argument correctly, it is the converse of the argument which Mr Chambers advanced successfully on the appeal. If Bank Melli had authority to accept or reject the documents as agent of Bank Markazi, how could Bank Markazi have an independent right to reject the documents as principal? Of course it was open to Bank Markazi to waive the discrepancies, if so instructed by the buyers. But that is an altogether different matter. For the reasons which I have given in relation to the appeal, I regard the cross-appeal as unarguable. Conclusion Mr Clarke had a final argument, not advanced below. Seeing that the plaintiffs have leave to serve out of the jurisdiction in respect of the first presentation, and seeing that one of the issues which will be canvassed is Bank Melli’s authority to reject the documents on behalf of Bank Markazi, it is just and convenient that that issue should be tried in respect of both presentations at the same time in the same court. otherwise there might be inconsistent judgments. 0n receiving some encouragement from the court, he then put the argument on a broader ground. It could not be right, he said, to subject the plaintiffs to the expense of bringing two sets of proceedings when the defendants will in any event be obliged to come here to defend the plaintiffs’ claim on the first presentation. 19ASSN, x7 I can of course see that multiplicity of proceedings is undesirable. But there is a danger in these cases of looking at matters through English eyes. The defendants might, for all we know, decide not to defend the plaintiffs’ claim on the first presentation. Ought we to bring them here to defend the claim on the second presentation, when the plaintiffs have not shown a good arguable case, or even a case worthy of consideration? I would answer that question in the negative. The cost and inconvenience of two sets of proceedings are certainly factors to be taken into account in the exercise of the discretion. No doubt Saville J. will have had them well in mind, when exercising his discretion, although the point was not argued, so we do not have the benefit of his views. In my judgment the additional cost and inconvenience of two sets of proceedings do not make up for the essential weakness of the plaintiffs’ case on the second presentation. I would therefore dismiss both the appeal and the cross-appeal. LORD JUSTICE STUART-SMITH: The question in this appeal is whether the plaintiffs’ case on the merits in relation to the second presentation of documents on 3rd December 1987 is sufficiently arguable to make the case a proper one to give leave to serve out of the jurisdiction. The answer to this question depends upon two further questions. First, what is the appropriate test of sufficiency and secondly, whether the plaintiffs’ arguments meet that test. Before turning to a consideration of these questions it is important to set out certain matters which are either common ground or can be taken as established. 1. It is not disputed that the claim in relation to the second presentation falls within the provisions of order 11, rule 1(e 20ASSN. a (breach of contract within the jurisdiction) and probably also Order 11, rule 1(d) (iii) (contract governed by English law). There is therefore no issue on jurisdiction. 2. England is the forum conveniens. This has never been in issue. Mr Chambers Q.C. submits that Iran is an equally appropriate forum. Mr Clarke Q.C. submits that it is the most appropriate forum. I agree with Mr Clarke. The case depends largely on the proper construction of the Uniform Customs and Practice for Documentary Credits (1983 Revision) (the UCP), and the contract is one which is governed by English law; the two most important witnesses, Mr Appiano and Mr Mansouri, appear to be resident in this country; the case in relation to the first presentation will be tried in this country; some of the same issues and the same witnesses are common to both causes of action. This is a matter to which I shall return. 3. The plaintiffs have shown a sufficiently arguable case in relation to the first presentation for it to be a proper case for service out of the jurisdiction. The judge so held, applying a high standard of sufficiency. Although the defendants have cross-appealed on this issue, I would dismiss the cross-appeal for the reasons given by Lloyd L.J. with which I agree. 4. It is conceded by Mr Chambers that the judge applied too high a standard in relation to the sufficiency of the plaintiff’s argument on merits. He said that the plaintiff had to show that it would probably win; in so doing he misdirected himself in purporting to follow Attock Cement Co. Ltd. v. Romanian Bank for Foreign Trade Ltd [1989] 1 W.L.R. 1147, a case concerned with jurisdiction as opposed to merits. That this is the wrong test is now established in Overseas Union Insurance Ltd. v. Incorporated General Insurance Ltd. [1992] 1 Lloyd’s Rep. 439 21ASSN. v4 (the OUI case), which was decided after the judge gave his decision in this case. This being so, it is also conceded by Mr Chambers that it is now for this court to exercise its discretion afresh to decide whether the case is a proper one for service out. What is the test of a sufficiently arguable case on the merits? This is a question which has been the subject of discussion and decision in three recent cases in this court. The first is the OUI case, the second is Societé Commerciale de Reassurance. Eras International Ltd. [1992] 1 Lloyd’s Rep. 570 (the Eras Eil case) and the third is Banque Paribas v. Cargill International S.A. [1992] 2 Lloyd’s Rep. 19. It might have been thought that these cases, and particularly the Banque Paribas case, had finally determined the question, at least so far as this court is concerned. In dealing with the merits of the plaintiffs’ claim in that case Parker L.J., with whose judgment McCowan L.J. and Sir Christopher Slade agreed, said this at p.25 "I see great force in the defendants’ submission but as the evidence stands I do not regard the plaintiffs’ case as being unarguable. On both points involved in this part of the case I consider that the plaintiffs’ case is arguable. The question is then whether it is sufficiently arguable to make it proper to give leave to serve out. If the two points went to jurisdiction I would conclude that the point on governing law was not, but that, albeit with hesitation, the point under Dicey’s r.121 was. They do not however go to jurisdiction. The jurisdiction is in my view present and the question is therefore whether the plaintiffs’ case is sufficiently arguable to justify subjecting the defendants to a jurisdiction which is to them foreign. In my judgment the answer to this question is in the affirmative. The plaintiffs’ case is in my judgment worthy of consideration by the Court..." In the OUI case Parker L.J. again gave the leading judgment, with which I and Mann L.J. agreed, though Mann L.J. added a short 22ASSN. DO judgment of his own. At page 447 after considering the speeches of their Lordships in Vitkovice Horni v. Korner [1951] A.C. 869 (Korner’s case) Parker L.J. said: "It is clear from the above that the majority took the view that there was only one question to be answered, namely ‘Is the case a proper one?’ It is also clear that Lord Oaksey took the view that, if England was plainly the appropriate forum the standard of proof that one of the qualifying conditions was met would be reduced. As to the standard of proof opinions differed but in my view it is important to note that Lord Tucker was of the opinion that, on merits, all that was required was that a case meriting consideration should be shown and that it was unnecessary to go into the question whether a defendant had a valid set-off which might even extinguish the claim. Where then does all this lead? It leads in my view to this, that there is only one requirement, namely that it shall be made sufficiently to appear that the case is a proper one. There is one overall scheme of which the elements are a case on the merits, fulfilment of one or more of the qualifying conditions, and England being the most appropriate forum in the sense that England is the forum in which the case can most suitably be tried in the interests of all the parties and for the ends of justice. As to the last see Spiliada Maritime Corporation v. Cansulex Ltd., [1987] 1 Lloyd’s Rep. 1; [1987] A.C. 460 As to standard of proof, Lord Oaksey’s view must, as it seems to me, be right. | Suppose for example that it is common ground between the parties, or there is overwhelming evidence that, if the case is to be tried at all, England is the appropriate forum and that, on the merits, the plaintiffs’ case is worthy of serious consideration, I can see no reason why he should be forced to have his action for breach of contract tried in an inappropriate forum because e.g. his contention that the contract was governed by English law does not persuade the Judge that that is probably the case, or that there is a strong probability that that is the case." The Eras Eil case is important because it shows that the standard of sufficiency on the merits is not a rigid one, but is flexible and interlinked with the questions of jurisdiction and forum, though a minimum standard must be reached. After referring to the judgment of Slade L.J. in Metall und Rohstoff A.G. v. Donaldson Lufkin & Jenrette Inc. [1990] 1 Q.B. 391 at 434, to which I shall have to refer later, Mustill L.J. giving the judgment of the court said at p.587: 23Assn. 31 "It will be observed that of the three tests prescribed by this formulation, only the second relates directly to jurisdiction in the strict sense. The lettered paragraphs of 0.11, r.1 state conditions, one at least of which must be shown to exist before the Court can contemplate the exercise of the discretion to permit service abroad. However obviously justified the claim, however obviously sensible it may be to have it tried in England, the Court must not grant leave unless the case falls within the lettered paragraphs. It is therefore to be expected that a stricter test will be applied when deciding whether the claim does so fall, than in regard to the first and third stages, which are not concerned with formal jurisdiction. This is indeed what we find. A further consequence follows. The first and third requirements, unlike the second, do not spring directly from the words of the rule, but are the creation of precedent. It seems to us that the first, as well as the third, must derive ultimately from the existence of the discretion to permit service, once the second requirement is fulfilled. Where it is being considered whether the foreigner should be brought here to answer a claim away from his home forum, one factor must obviously be the likelihood that the claim is ill-founded, and it would appear that as a matter of common sense this requirement and the other factors which do or do not show that England is a proper forum must be inter-related. The more conspicuous the presence of one element the less insistent the demands of justice that the other should also be conspicuous. (See the observations of Lord Oaksey in Korner’s case [1951] A.C. at pp.881-882). This is not to say that there is no minimum level of conviction about the soundness of the claim. This would not be consistent with the authorities, nor would it be right. If the claim is too weak, it would be wrong to put the foreigner to the trouble and expense of coming to England to answer it. But we do emphasize that although the traditional three-stage enquiry is convenient for the purpose of analysis it should not be allowed to disguise the fact that the stages are linked. The exercise does not consist of a series of gates of which the first, once negotiated, can be put entirely out of mind. If this is right, one would not expect, and does not find, that the test at the first stage is entirely hard-edged to be applied rigorously in complete isolation from all other aspects of the case. That this is so is evident from the criterion of ‘good arguable case’, already cited. As so often happens in the common law, a useful turn of phrase has come, by judicial repetition, to be treated as if it were part of a statute or rule of Court; and attention is then shifted to an argument about what it means. The expression ‘good arguable case’, mystifying a foreigner, conveys an impression with which the English lawyer is familiar. But it will not yield to dissection. What is the difference between the probabilities of success demanded by a ‘good arguable case’ and a prima facie case? What is the distinction between a ‘good 24ASSN. 3m case’ and a ‘good arguable case’? And so on. The enquiry is unprofitable. The imprecision of the test reinforces the opinion that the grant of leave under 0. 11 should be looked at in the round, and not over-analysed". The reference to the three tests are to the merits, the jurisdiction and the forum conveniens in that order. Basing himself on these authorities Mr Clarke submitted that the appropriate test was "worthy of consideration by the Court", “arguable and not unarguable" (see the Banque Paribas case) or “yorthy of serious consideration" (see the OUI case) and that the matters which I have set out in paragraphs numbered 1-3 in relation to jurisdiction and forum conveniens can be prayed in aid by the plaintiffs so that the court should conclude that as a matter of discretion the case is a proper one for service out As against this Mr Chambers submitted that the test as to merits was a good arguable case, bearing the meaning that the court must be satisfied that the plaintiffs have a good chance of success. In support of this submission he relied upon a number of arguments. First, that this was so stated by Slade L.J. giving the judgment of the court in Metall und Rohstoff in the passage commented upon by Mustill L.J. in the passage quoted above from the Eras Eil case. At page 434G he said: "ord. 11, r.4(2) provides that leave to serve a defendant out of the jurisdiction shall not be granted ‘unless it shall be made sufficiently to appear to the court that the case is a proper one for service out of the jurisdiction’ under the Order. This imposes a three-fold burden on a plaintiff seeking leave. First he must show that the claim he wishes to pursue is a good arguable claim on the merits. While the court cannot at this stage determine whether the plaintiff, if given leave, will succeed, it must be satisfied that the plaintiff has a good chance of doing so. Secondly, the plaintiff must show a strong probability that the claim falls within the letter and the spirit of the sub-head or sub-heads of Ord.11, r.1(1) relied upon. This requirement is treated strictly, since if leave is given (and, if challenged, upheld) it will never thereafter be investigated: Vitkovice Horni A Hutni 25ASSN, 33 Tezirstvo v. Korner [1951] A.C. 869, 889, per Lord Tucker. It is, furthermore, an established principle that a foreigner resident abroad will not lightly be subjected to what is, to him, a foreign jurisdiction. Thirdly, the plaintiff must persuade the court that England is the forum in which the case can most suitably be tried in the interests of all the parties and for the ends of justice. This calls for the making of a judgment, the nature of which has recently been comprehensively reviewed in Spiliada Maritime Corporation v. Cansulex Ltd [1987] A.C. 460, to which we revert below..." Mr Chambers submitted that this statement was binding on the court, and presumably therefore the passage in Parker L.J./s judgment in the OUI case which I have cited (which Mr Chambers submitted was obiter) was wrong and also the decision in the Banque Paribas case was wrong. I do not accept this submission. In Metall und Rohstoff, save in respect of one matter, the court was concerned with jurisdiction and not merits. That matter related to the claim in conspiracy. The plaintiffs had not pleaded or presented evidence that in making the alleged agreement and performing pursuant to the alleged agreement the acts which caused the damage to them, the defendants had the sole or predominant purpose of injuring them. This was a necessary ingredient in the tort of conspiracy as laid down in Lonrho Ltd v. Shell Petroleum Co. Ltd. (No.2) [1982] A.C. 173; the claim was therefore not arguable by any standard. See pp. 466H to 467B. What is said therefore by the court as to the meaning of good arguable case is, in my opinion, obiter. Moreover I do not see how Sir Christopher Slade could have agreed with Parker L.J. in the Banque Paribas case if he thought otherwise. In the light of that decision I do not think it is profitable to consider whether Parker L.J.’s observations in the OUI case which I have quoted were obiter or a matter of decision; nor whether Mann L.J. in his judgment in that case, put a different gloss on the matter; he expressly agreed with Parker L.J.’s judgment. 26ASSN. 3A Secondly Mr Chambers submitted that on a correct analysis of the speeches in Korner’s case their Lordships were laying down a similar test for jurisdiction and merits, and that that test was "good arguable case" per Lord Simonds at p.880 (with whose opinion Lord Normand agreed) or "strong argument" per Lord Radcliffe at p.885. I do not agree with this submission. I do not propose to set out the relevant extracts of their Lordships’ speeches again: these can be found in Parker L.J.’s judgment in the OUI case. I would merely make the following comments. 1. Korner’s case was not concerned with the merits, it was concerned with jurisdiction. 2. Apart from a possible reference in the speech of Lord Radcliffe at the bottom of p.883, none of their Lordships except Lord Tucker, dealt with the question of the merits as opposed to jurisdiction. I do not think the passage in Lord Radcliffe’s speech assists the defendants here; even if he is referring to merits as opposed to jurisdiction, he is dealing with the question which arises when the same issue goes both to jurisdiction and merits, for example whether a contract was made. Quite plainly in such a situation the plaintiff has to satisfy the higher threshold of sufficiency necessary to establish jurisdiction. At p.889 Lord Tucker said, referring to Lord Goddard’s judgment in Malik v. National Bank of Czechoslovakia 176 L.T. 136: “As I read Lord Goddard’s words, he is saying no more than that before it is ‘made sufficiently to appear to the court’ that notice of a writ should be served out of the jurisdiction the court will require more cogent evidence with regard to those matters which may not thereafter be the subject of any further investigation than in the case of those issues which will necessarily be fought out at the trial. Take for example a case of tort under r.1(ee). Suppose it is sought to serve notice of a writ 27ASSN. be out of the jurisdiction in respect of a collision at sea alleged to have taken place within the jurisdiction, the court will not be concerned to enter into the question of the negligence of the defendants provided the affidavits disclose a case which appears to merit consideration at the trial, but, assuming negligence, it should in ny opinion require cogent evidence pointing to a strong probability that the collision occurred within the jurisdiction before it will allow service out of the jurisdiction, this being an issue which may never arise at the trial, and which, if it does arise and if it be proved that the collision took place outside the jurisdiction, will not divest the court of the jurisdiction it has wrongly assumed. The Fagernes is an example of such a case." This passage affords cogent support for the views of this court in the OUI and Banque Paribas cases. 4. It is now firmly established that there is a higher threshold on the question of jurisdiction than on merits. This is clear from the three recent cases and Metall und Rohstoff. 5. Accordingly I agree with Mr Clarke’s submission that the correct test of sufficiency is whether the plaintiffs’ arguments on merits are worthy of consideration (or serious consideration! by the court and in deciding the overall question whether the case is a proper one for service out of the jurisdiction consideration of forum conveniens can be prayed in aid by the plaintiffs in this case. In my judgment this conclusion is consonant with common sense and policy. It seems to me to be wholly inappropriate once the question of jurisdiction and forum are established for there to be prolonged debate and consideration of the merits of the plaintiffs’ claim at the interlocutory stage. There cannot be trial on affidavit, it may be difficult to draw proper inferences from such facts as are established at the interlocutory stage. Complex questions of construction or law cannot conveniently be decided. I turn then to consider the plaintiffs’ argument; subject to some points that the defendants have not been able to argue at 28ASSN. 3b this stage, if the plaintiffs succeed in any one of them at the trial they should win the action. 1. No discrepancy in the documents The only argument at this stage relates to the "Proces Verbal". One of the documents which had to be presented was "proces verbal of goods confirmed by orderer’s authorised rep. who will be fully identified later on". It was so signed by Mr Eskandari. But under the heading “other conditions", the letter of credit stated, "our LC no. and our principal’s name should appear on all docs. and packages." Neither the letter of credit number nor the name of the MOD for Logistics appeared on the Proces Verbal. Mr Clarke submits that this omission was trivial. Notwithstanding the rule of strict compliance is required, and Viscount Sumner’s dictum in Equitable Trust Company of New York v. Dawson Partners, Ltd. (1926) 27 Lloyd’s List Reports 49 at 52, that "there is no room for documents which are almost the same, or which will do just as well", some margin is allowed. In Banque de 1’Indochine et de Suez S.A. v. J.H. Rayner (Mincing Lane) Ltd. [1983] Q.B. 711 at 721E Parker L.J. said: "I have no doubt that so long as the documents can be plainly seen to be linked with each other, are not inconsistent with each other or with the terms of the credit, do not call for inquiry and between them state all that is required in the credit, the beneficiary is entitled to be paid.” In my opinion it can be properly argued that the Proces Verbal fulfils this test. It was submitted under cover of the letter of 1st December 1987 together with the other documents there set out. It identified the goods and the contract and was signed by the orderer’s representative. A glance at accompanying documents reveals that it relates to the same matter 29ASSN, 37 there referred to from which the Lc number and the principal’s name can be discovered without inquiry. As against this Mr Chambers argues that unlike the Banque de 1/Indochine case, these requirements are specifically referred to in the letter of credit; that although it is difficult to see what purpose they serve on the document since there cannot be any doubt that it relates to the goods in question, documents of this nature are checked at a low level in the bank and the task is almost a mechanical one, not calling for any judgment on the part of the checker. I see the force of these points. But I do not consider they render the plaintiffs’ case unarguable or unworthy of consideration. 2. No authority on part of Bank Melli to reject The defendants rely on the telex of 8th December 1987 as constituting a rejection of the documents. The plaintiffs’ argument depends first of all on the construction of the UCP. Mr Clarke submits that the effect of Articles 2, 11 and particularly 16 of the UCP makes it plain that it is only the issuing Bank Markazi, and not the nominated or paying Bank Melli that can reject the documents. Bank Melli are authorised to pay provided the documents conform exactly to the letter of credit, but the decision to take up or reject the documents is the decision of the issuing bank only, who, after consulting their customer, alone can waive any discrepancies. Consequently non-payment by Bank Melli does not constitute rejection of the documents by the defendants. This argument found favour with Saville J. such that he thought the plaintiffs were likely to win applying the Attock test. Mr Chambers does not challenge this preliminary view by a cross-notice; I do not see therefore how we can say that the plaintiffs do not have a sufficient case on it, 30Assn, 3S whatever standard is adopted. But the judge adjourned the case for the defendants to adduce evidence of actual authority. A further affidavit was sworn by Mr Mansouri and an affidavit was put in from Mr Emadi-Allahyari from the defendant bank; the effect of these affidavits is that there was no express authority given by the defendants to Bank Melli, but authority arose from a course of dealing. Having regard to this evidence the judge thought the plaintiffs could not discharge the onus of showing that they would probably win on the issue. But Mr Clarke seeks to counter this evidence in a number of ways. First he submits that on the construction of the UCP favoured by the judge the duty of deciding whether to reject or accept the documents was non-delegable; it rested with the defendant and could not, at least without the consent of the plaintiffs, be delegated to Bank Melli. Secondly, that in the case of an unconfirmed letter of credit, the defendants cannot rely on a course of conduct which is at variance with the terms of the UCP. He points out that there is nothing special in the relationship between the defendants and Bank Melli, since Mr Emadi-Allahyari’s evidence is that precisely the same situation would pertain with Lloyds or any other nominated bank; he submits that the evidence is based on a misconstruction of the UCP. Thirdly, he relies upon the evidence of Mr Appiano as to what was said at the meeting with Mr Mansouri on 5th October 1987, when he claims that the latter told him that the Bank Melli could not decide whether to reject the documents, this was a matter for the defendants. This they were asked to decide by the telex of 6th October 1987 requesting them to authorise payment notwithstanding discrepancies; but the defendants never answered. Further he submits that although there is a dearth of evidence as to what 31transpired between these two gentlemen on 10th December following the second presentation, it is to be inferred, at least for the purpose of the present proceedings, that the matter was treated in the same way. This is borne out by the telex of 11th December 1987 from Bank Melli to the defendants which is in similar terms to that of 6th October and by a further telex dated 6th January 1988 in which Bank Melli treat the two presentations in a similar manner asking for the defendants’ decision. It is unlikely in the extreme that the parties would have treated the two presentations differently. Mr Appiano’s evidence as to what was said on Sth October is disputed by Mr Mansouri; we cannot resolve that dispute. Mr Mansouri says nothing about the meeting on 10th December, but it does seem that the telex of sth December from Bank Melli to the plaintiffs upon which the defendants rely as a rejection, did not reach the plaintiffs because of the wrong telex number; that following a telephone call on 9th December Mr Appiano attended at the bank, was handed the telex and the matter was discussed with the result that the telex of the 11th was sent to the defendants. For my part I do not see how the untested further evidence of Mr Mansouri and Mr Emadi-Allahyari and the language of the telex of 8th October can deliver such a knock-out blow to these arguments that they are no longer worthy of serious consideration by the court. I consider the plaintiffs cross the threshold of sufficiency on this issue. No rejection The plaintiffs contend that the telex of 8th October was not a rejection, but simply a notice that Bank Melli would not pay because of the discrepancies. This point was not taken initially; indeed both the pleadings and Mr Glencross’s affidavit in support of the application under Order 11 assert that it was a 32ASSN Ao rejection; so the plaintiffs are in some difficulty. But there appears to have been a lack of communication between Mr Appiano Mr Laprade and the plaintiffs’ solicitors as to the meetings between Mr Appiano and Mr Mansouri on 5th October and 10th December; though no doubt these matters will be fertile ground for cross-examination if the case goes for trial, they are not I think fatal to the plaintiffs’ case. A more serious objection is the language of the telex itself and particularly the use of the words, "Meanwhile documents held by us at your risk and disposal", which is certainly consistent with the language of rejection. On this issue I think the defendants are on firmer ground, and if this argument had stood alone and in the absence of further considerations on forum conveniens to which I shall refer in due course, I do not think I would regard the Plaintiffs’ case as sufficiently strong. This point is to some extent bound up with the previous one. I do not regard it as hopeless or unarguable. No rejection in time For the purpose of the appeal the plaintiffs accept that the documents were presented to Bank Melli on 3rd December, although they reserve the right at trial to contend that it took place on 1st December. Initially the plaintiffs asserted that five days was a reasonable time under Article 16(c) of the UCP in which the defendants should decide whether to accept or reject. on this basis Mr Clarke submits that since the telex was not received until the 10th it was not in time. I am not greatly impressed by this argument. Had it been received on the 8th when it was sent, it would have been in time. It was not the bank’s fault that it was wrongly addressed; it seems to me that in a situation like this an extension of the usual time should be given, so that 33