Conclusion
Soft clauses in letters of credit may be an example of the maxim: ‘Fool me once, shame on 3.36 you; fool me twice, shame on me.’ Any beneficiary who does not object to the presence of a soft clause in a letter of credit may find itself in a similar position to the beneficiaries in the Messiniaki Tolmi, Marino Industries, and Nareerux cases, struggling to achieve a complying presentation in circumstances where it is impossible for them to cure any documentary non-conformity themselves.
Presumably, any beneficiary who suffers through this experience will vow never to put itself in such a weak position again—unless it has to because the nature of the trade means that the applicant can dictate the terms. As for the applicant, even if it originally has a legitimate reason for including the soft clause, a change in market conditions may put it in the situation of the fictional Lord Darlington in Oscar Wilde’s play Lady Windermere’s Fan: ‘I can resist anything except temptation.’3.37 It seems that little can be done to alleviate the position of the beneficiary if the applicant becomes uncooperative in production of the documents required by the soft clause—indeed, some would say that nothing should be done to remove the rod that the beneficiary put on its own back. To date, courts have been stern in their application of the doctrine of strict compliance in soft clause cases to rebuff beneficiaries who have tried to present documents that are ‘almost the same’.[313] Perhaps the creeping intrusion of fairness at the expense of commercial certainty may see a change in letter of credit law in the future,[314] but unless and until there is some relaxation in the standards of strict compliance, either generally or specifically in relation to soft clauses, exporters would be well advised to suggest an alternative method of payment if their importers propose inclusion of a soft clause.