Page:Harvard Law Review Volume 32.djvu/57

23 LETTERS OF CREDIT 23 firmed," or "irrevocable," or sometimes "confirmed and irrev- ocable letters of credit." This raises at once the question whether the text of the instrument is not an informal attempt to express a transaction of another sort rather than that indicated by the text taken alone — a transaction weU known to the commercial world by the name given it. Lastly there is a fourth type drawn apparently with no theory in mind other than the business imderstanding of a "confirmed and irrevocable letter of credit," and on the assumption that the written promise of a business man in the course of business is self sufficient.^ Here it will be observed there are no words suggesting the holding of money to the use of the addressee, and unless some meaning is attributed to the very words "confirmed letter of credit" which will bring it within the theory of a representation of money held to the use of addressee or the theory of an offer, the addressee must bestir himself to show a consideration by proof that the letter was issued in exchange for his then and there en- tering into a contract with the holder, or something of the sort. Either that or we must go outside common-law theory and look to the law merchant to uphold such letters. As the matter stands in the decisions, the first type, from the standpoint of the exporter, is clearly the most satisfactory. In view of commercial usage, the understanding of the business world, and the decisions of the New York courts in Johannessen v. Mun- roe ^ and Krakauer v. Chapman ^ it may well be contended, and it is submitted, that courts which are reluctant to go further should hold, as the minimum of progress demanded, that use of the words " For example this form: Irrevocable Letter of Credit [No.] [Date] [Addressee] : At the request of [holder] we hereby open an irrevocable letter of credit, [No. ] . in your favor to the extent of [amount of credit] against [terms and purposes of credit} available imtil [expiration date] under the contract between yourselves and [holder]. We hereby agree and promise to pay you the amount above mentioned upon presen- tation of the documents in comphance with the terms of this credit. [Signature of Issuer] • Other variations of these forms may be found in Hough, Practical Exporting, 544/- » 158 N. Y. 641, 53 N. E. 535, 9 App. Div. 409, 41 N. Y. Supp. 586 (1899). ^ 16 App. Div. 115, 45 N. Y. Supp. 127 (1897).