because it was an attempt to take unilateral action with respect to modification of the terms, of an irrevocable letter of credit, which is impermissible without the consent of the beneficiary. See Uniform Commercial Code Comment, 12A P.S. § 5-106.
Mellon next argues that Encar did, in effect, consent to this provision by not objecting to its inclusion in Amendment number 15. Mellon further notes that subsequent amendments also contained the notice provision and no objection was raised. Therefore, Mellon claims it justifiably relied on this silence to mean that Encar consented to this provision. While this is not totally against all reason, we do not agree. We believe the better view, and one which will facilitate stability and certainty in the commercial world, is that any modification of the underlying agreement between buyer and seller, or any modification of the letter of credit, should not affect the letter of credit unless the beneficiary explicitly consents to the modification of the letter. See Asociacion de Azucareros de Guatemala v. United States National Bank of Oregon, 423 F.2d 638 (9th Cir. 1970). In order for this provision of Amendment number 15 to be effective, the explicit consent of Encar was necessary. Since there is no evidence that Encar did so consent, the notice provision of Amendment number 15 was ineffective.
We believe this interpretation of the Code's section concerned with modification of letters of credit is consistent with and will help to promote the general stability associated with letters of credit.
Mellon advances the theory that Banco became a confirming bank within the meaning of U.C.C. § 5-103(1)(a) and, in addition, paid Encar at its peril, thereby forfeiting any right of reimbursement from Mellon. This argument assumes, of course, that the notice provision was required before any bank whether an issuer, or a confirming bank, could release payment against the remaining documents. Since Banco did not wrongfully honor Encar's draft, it is entitled to reimbursement from Mellon. Cf. Chase Manhattan Bank v. Equibank, 550 F.2d 882 (3d Cir. 1977).
For all of the foregoing reasons, we hold that summary judgment in favor of Banco is appropriate. The amount of recovery is the face amount of the draft 0148-IG, plus interest. We decline to award attorneys' fees to Banco. See Data General Corp. v. Citizens National Bank, 502 F. Supp. 776 (D. Conn. 1980).
An appropriate order will issue.
AND NOW, this 11th day of March, 1983, IT IS ORDERED that the Motion for Summary Judgment filed by the plaintiff, Banco Nacional de Desarrolla, is GRANTED, the Motion filed bu defendant, Mellon Bank, N.A., is DENIED, and that judgment is entered in favor of the plaintiff, Banco Nacional de Desarrola, and against the defendant, Mellon Bank, N.A., in the amount of $ 43,387.50 with interest at the rate of.06 per annum from February 19, 1981 to the date of this Order, and said judgment shall be subject to post-judgment interest at the rate of.0899 per annum until the judgment is satisfied. Costs, other than attorney fees, are to be paid by the defendant.