Silent Confirmation Agreement Meaning

Home > Banking > Acckreditive: Silent confirmations do not deprive a bankrupt bank of its rights as a named bank according to UCP 600 An implicit conceptual solution is also not satisfactory, as the defendant`s lawyers are undoubtedly already busy re-elaborating the standard agreement to exclude implicit conditions. The implicit solution is probably a one-size-fits-all solution. The confirmation bank refers to the bank that adds its confirmation to a credit at the request or authorization of the issuing bank. A silent confirmation letter resembles a formal letter of credit. It also has the protection of a foreign bank that supports a national bank, but the national bank has the opportunity to negotiate terms and prices with the seller. Costello J also responded to the applicant`s allegation that the defendant had breached the tacit terms of the agreement. He acknowledged that there were implicit conditions, that the defendant would take all necessary steps to obtain payment in the event of default by the BOI.13 Instead of following this simple and effective procedure, designated banks sometimes choose to enter into separate agreements with the beneficiary that purport to "confirm" the loan under certain conditions. The conditions are always unfavourable to the beneficiary and the procedure is called "silent confirmation". "Silent confirmation", although usually, is a dangerous and dangerous device. This is illustrated by Greenhill International Pty Ltd v Commonwealth Bank of Australia [2013] SADC 7.

Instead of simply informing the recipient that they agreed to negotiate the loan, the CBA entered into an agreement called "silent confirmation."