Uniloy Milacron Inc. v. PNC Bank, N.A.
United States District Court for the Western District of Kentucky
2008 U.S. Dist. LEXIS 33063 (2008)
- Written by Tammy Boggs, JD
Facts
Uniloy Milacron Inc. (Uniloy) (plaintiff) contracted to manufacture two bottling machines for MAB, LLC (defendant) for a total price of over $1.3 million. MAB was required to provide a letter of credit for $388,000 of the purchase price. PNC Bank, N.A. and related entities (collectively, the bank) (defendants) issued a letter of credit to Uniloy on behalf of MAB. The letter of credit expired on July 31, 2006. To obtain payment, Uniloy was required to present: (1) a dated, signed certification that Uniloy had not received payment from MAB within 60 days of shipment of two blow molding machines of model number UR8X7-7PNE CBTR and serial numbers N01A010088 and N01A0100089; (2) unpaid invoices for the machines; and (3) bills of lading evidencing the shipping date. On May 3, 2006, Uniloy shipped the machines to MAB, and MAB failed to pay the remaining $388,000. On July 31, 2006, the bank received Uniloy’s demand for payment under the letter of credit (draw request) with a cover letter dated July 28, 2006. Uniloy’s compliance documents included: (1) a signed but undated certification of MAB’s nonpayment; (2) unpaid invoices for the machines, but with one serial number noted as N01A0100088; and (3) bills of lading for the machines with serial numbers N01A0100088 and N01A0100089 and model descriptions noted as “Uniloy R2000 B.M.M.” The bank refused to honor the letter of credit due to discrepancies between Uniloy’s draw request and the letter of credit. Uniloy sued MAB and the bank, seeking declaratory judgment that the bank could not refuse to honor the letter of credit. The parties filed cross-motions for summary judgment on the declaratory-judgment claim.
Rule of Law
Issue
Holding and Reasoning (Simpson III, J.)
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