Because standbys and demand guarantees often contain automatic extension clauses, ICC Opinion TA954 offers important lessons for practice and the need for sound drafting of such clauses.
The Windsor Township v. Tompkins Financial Corp. case emphasizes the significance of original letters of credit but questions their necessity in modern electronic transactions.
Developer Greth Development secured a letter of credit from Tompkins Financial to ensure completion of a townhouse project for Windsor Township. After project delays and a breach, Windsor sued the developer and demanded payment from Tompkins, who refused.
