Page:Harvard Law Review Volume 32.djvu/68

34 its terms, in the absence of any representation of them in the notification; and as that contract would probably simply be one to pay what should accrue to the addressee under the terms of the then existing buyer-seller contract, in which, as a mercantile contract, time would be an essential element, any modification as to time would thus seem to be a new contract between buyer-holder and seller-addressee to which the contract between buyer-holder and issuer for the benefit of the addressee would not be applicable. On the theory of money received and held to the use of addressee on condition, the issuer would seem to be in the position of a stakeholder for buyer-holder and seller-addressee according to their respective interests, subject to such conditions as the letter may contain. If so, no conditions as to time being imposed, the parties should be able to fix those interests between themselves by further contract, if they choose. In Japanese forms, where no time is fixed, it is not uncommon to find a provision that "this letter expires by limitation." This presumably originates in a provision of the Japanese law, taken from German law, requiring express reservations of power of revocation and express provisions for lapse. It effects nothing that would not take place in our law without such clause, so that what has just been said would apply.

We should also consider the question of inability to perform the conditions, and the effect of supervening events (e. g., government embargo, fire, strikes, etc.) upon the obligations incurred by the letter. It may well be that the buyer-seller contract will contain provisions as to these things and yet they will not be provided for in the letter of credit. No doubt in general, the parties being agreed in desiring the execution of their contract, extensions of credit would be arranged in such cases. But should the buyer-holder be desirous of withdrawing from his contract he might take advantage of the impossibility of performance of the conditions of the credit and, by trying to cancel, seek to embarrass the seller-addressee by compelling him to pursue his remedy for breach of the contract in a foreign land. In such a case, it would seem clear that on the offer theory of a letter, nothing short of the performance of the