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On 20 February mario entered into contract with Daniel for the purchase of some goods and he has agreed to pay by international credit transfer.Mario uses the National bank of Erehwon(NBE) and Daniel uses the National bank of Nova(NBN)
On 15 march Mario instructs NBE to initiate a payment order to NBN sending all appropriate paperwork to NBN on same day.
On 16 march NBE credits the relevant amount to their own account with NBN and NBN transfer those funds to daniel account on 17 march.
Question
Transfer is accepted by NBN on 16 march.
True or false.Sir my answer was false as i thought transfer is accepted on 17 march
Can you explain me please as the answer given is trueTechnically, and to be a total pedant, the correct response should be “Yes” or “Correct” because it is a fact that the transfer IS or IS NOT accepted on 16 March so the entirety of possible answers is covered by the two possibles, “true or false”.
Poor wording of a question 🙁
I believe the crucial element here (and it’s not emphasised in the question) is that NBE credited the amount to their account at NBN on 16th March. Even though the funds didn’t find their way into Daniel’s account until 17th March, NBN had control over the funds with effect from 16th.
Now, I’ve asked you this before! What are the grounds / justifications for you to think that the transfer is accepted on 17th March? What authority are you claiming / relying upon?
Sir the un convention on international credit transfer has a particular article that states various points which relates to the fact that when the acceptance will be indicated.
Of all the points it is not mentioned that acceptance is indicated by the fact that the sending bank has credited the account of receiving bank.That’s why the payment order will be accepted on 17th march when nbn has credited the account of beneficiary.
Also sir it is given that when receiving bank has an account at the sending bank and when the sending bank credits the account of receiving bank the payment occurs when the credit is used or if available to use, on the banking day following the day when the credit is available and the receiving bank is aware of the fact
So in this regard the receiving bank has used the amount on 17 march.I asked you to give me the authority on which you have based your answer. The reason that I ask is not for you to simply say “There is an article ….” but for you to give me a reference to that article / authority so that I may look it up.
There are 154 pages on my computer related to the Uncitral rules on funds transfer.
I am not prepared to plough through them.
Give me a specific reference and I’ll look it up!
OK?
Sir based on article 9 of un convention on international credit transfer
I am not able to understand how the answer is 16 marchI still maintain that the answer to the question is ‘true’ in that Article 9 states …
“(1) The beneficiary’s bank accepts a payment order at the earliest of the
following times:
(a) when the bank receives the payment order, provided that the sender and the bank have agreed that the bank will execute payment orders from
the sender upon receipt;”and the question asks …
“On 16 march NBE credits the relevant amount to their own account with NBN and NBN transfer those funds to daniel account on 17 march.
Question
Transfer is accepted by NBN on 16 march. True or false”The question is asking when the BANK accepts the payment order and that question in no way relates to the existence or entitlements of Daniel.
OK?
Sir based on your reference to article the sending bank has send the appropriate paperwork on 15th
So answer should be 15Doesn’t it say somewhere in the Convention (and DON’T ask me which article!) that the end bank (or intermediary if such is involved) should process no later than the day after receipt?
I’m happy with 16th. can you be happy too?
Ahhh!!!!!!
Yes sir it says
Now i got it completely
Thanks sir for sticking with me on this
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