1The preliminary injunction also (a) directs Harris to maintain a blocked account in the amount of the letter of credit, $674,035.20, in accordance with the Iranian Assets Control Regulations, 31 C.F.R. § 535.568 (1980), (b) enjoins distribution or removal of any funds from the blocked account, (c) directs the attachment of the blocked account for Harris’s benefit, and (d) continues a bond requirement of $674,035.20. Appellants do not challenge these provisions.
2Upon shipment of the equipment and receipt of the training, NIRT paid 80% of the price and deducted the remaining 20% from the advance payment. As to services, NIRT paid 90% of the invoice price and deducted 10% from the advance. For NIRT’s protection in case the contract terminated prior to full performance, the contract required that Harris obtain a guarantee letter of credit which would provide that advance payment not yet liquidated would be returned to NIRT. The central bank of Iran, Bank Markazi, issued the guarantee in the amount of $1,331,470.40; Harris’s performance has amortized all but $69,559 of the advance payment and the guarantee has been reduced accordingly. That guarantee letter of credit is not involved here. Harris does not seek damages in this action, but it contends that NIRT owes $128,410 for training which was completed in February, 1979. Also, NIRT has not paid for certain transmitters which have been completed but not shipped.
3The agreement is a standby letter of credit; it will be referred to herein as a performance guarantee or a guarantee letter of credit in order more easily to distinguish it from the standby letter of credit issued by Continental Bank in favor of Bank Melli. For an explanation of the operation of standby letters of credit and a comparison of standbys with traditional, commercial letters of credit, see Comment, Enjoining the International Standby Letter of Credit: The Iranian Letter of Credit Cases, 21 Harv. Int'l L.J. 189, 190-200 (1980).
4“The term ‘contract documents’ shall mean the following documents, which shall be deemed as an integral part of this contract: ... [6] the bank guarantees ....”’ Contract.
5The following paragraphs in the contract deal with force majeure and termination of the contract: 11-5 The contractor shall not be liable for any excess cost or for liquidated damage for delay if any failure to perform the contract arises out of force majeure acts of nature, or of government, fires, floods, epidemics, quarantins [sic] restrictions, to [sic] any such causes unless NIRT shall determine that the materials or equipment or services to be furnished by the contractor were obtainable from other source [sic] in sufficient time to permit the contractor to meet the required time schedule, provided that the contractor shall within (10) ten days from the beginning of such delay, notify NIRT in writing of the causes of the delay. NIRT shall ascertain the facts and the extent of the delay and extend the time for completing the work as its judgment and finding justify. In any event the contractor shall make every effort to overcome the causes of delay or to arrange substitute procedure and shall continue to perform his obligations to the extent he can. 11-6 If, arriving at any cause as set forth in paragraph 11-5 above, the contractor finds it impractical to continue operations, or if owing to force majeure or to any cause beyond NIRT’s control, NIRT finds it impossible to continue operations, then prompt notification, in writing, shall be given by the party affected to the other. If the difficulties or delay caused by force majeure cannot be expected to ease or be- come available, or if operations cannot be resumed within (6) six months, then either party shall have the right to terminate the contract upon (10) ten days written notice to the other. In the event of termination of the contract under this paragraph, payment will be made to the contractor as follows: (a) The contractor will be paid for all work completed as shown by the progress reports and for all reimbursable expenses due and unpaid. ‘Reimbursable expenses”’ means all expenses for service, material, equipment completed at the date of notification to terminate the contract and payment of which is pending under normal contractual terms. However, NIRT undertakes to pay for contractual equipment which was delivered, shipped, or ready for shipment, or within the production time, only according to the contract unit prices. (b) The contractor will also be paid for any work done during the said (6) six months period as well as for settlement of any financial commitments made in connection with the proper performance of the contract and not reasonably defrayed by payments under (a) above. (c) NIRT will also release all bonds and guarantee unless the total amount of payment previously paid to the contractor exceeds the final amount due to him, in which case, the contractor shall refund the excess within (60) days after termination, against the release of bonds and guarantee furnished to NIRT.
6President Carter declared a national emergency on November 14, 1979, and blocked the removal or transfer of Iranian assets. Exec. Order No. 12,170, 3 C.F.R. 457 (1980). To implement the blocking order, the Treasury Department promulgated the Iranian Assets Control Regulations, 31 C.F.R. §§ 535.101-904 (1981).
7The contract allowed NIRT to terminate the whole or any part of the contract, by written notice of default to Harris, under the following circumstances: (a) If in the judgment of NIRT the contractor fails to make delivery of material and equipment or to perform installations supervisory work or services within the time specified herein or any extension thereof. (b) If in the judgment of NIRT the contractor fails to perform any of the other provisions of this contract, or so fails to make progress as to endanger performance of the contract or completion of the work within the time specified herein or any extension thereof, and does not remedy such failure within a period of (30) thirty days (or such longer period as NIRT may authorize in writing) after receipt of notice from NIRT specifying such failure. Harris never received notice from NIRT under this provision of the contract.
8Harris states that Melli had already made four improper demands to extend or pay the guarantee in early 1979. Continental Bank advised Harris that the demands were nonconforming, and NIRT officials told Blaha that they were unaware of Melli’s demands. Melli abandoned the prior demands.
9Following entry of the TRO, Harris advised Continental Bank that payment on the letter of credit would aid and abet violation of the restraint imposed on Melli. Continental Bank responded that Harris’s creation of a blocked account “discharged” Continental’s obligation under the letter of credit and that Continental had so advised Melli.
10See p. 1346 & n. 1 supra.
11As indicated, § 1330(a) refers to exceptions to immunity under §§ 1605-1607 and under any applicable international agreement. To some extent, these two sources overlap. Section 1605(a)(1) of the FSIA deals with explicit and implied waivers of foreign immunity by sovereign states, and the House Report accompanying the FSIA contemplates that treaties can constitute explicit waivers: “With respect to explicit waivers, a foreign state may announce its immunity by treaty, as has been done by the United States with respect to commercial and other activities in a series of treaties of friendship, commerce, and navigation..." H.R. Rep. No. 1487, 94th Cong., 2d Sets. 18, reprinted in [1976] U.S.Code Cong. and Ad.News 6604, 6617.
12See pp. 1352-1353 infra.
13The requirement of commercial activity, as opposed to governmental acts, reflects the restrictive theory of sovereign immunity on which the FSIA is based. See House Report at 14, [1976] U.S.Code Cong. and Ad.News at 6613.
14“A ‘commercial activity’ means either a regular course of commercial conduct or a particular commercial transaction or act.” 28 U.S.C. § 1603(d). For an analysis of ‘commercial activity,” see Texas Trading and Milling Corp. v. Federal Republic of Nigeria, 647 F.2d 300, 307- 10 (2d Cir. 1981), cert. denied, 454 U.S. 1148, 102 S.Ct. 1012, 71 L.Ed.2d 301 (1982).
15Those methods were: (1) transmitting by telex to NIRT on June 12, 1980, the summons, notice of suit, and notice that pleadings would be sent by registered mail in English and Farsi transliteration (in accordance with the substitute service order in New England Merchants Nat’l Bank v. Iran Power Generation & Transmission Co., 495 F.Supp. 73 (S.D.N.Y. 1980)); (2) sending the summons, complaint and notice of suit in English and Farsi by registered mail to NIRT in Iran and to the Office of Consular Service for transmittal through diplomatic channels; and (3) delivering copies of the pleadings and preliminary injunction papers to Abourezk, Shack & Mendenhall, P.C., the firm which was coordinating Iranian litigation on behalf of Iran. (The Abourezk firm appeared at the preliminary hearing and represents NIRT in this appeal.)
16Though we find service adequate here, we admonish those seeking to invoke the FSIA to follow the service provisions it contains. Congress has carefully established a flexible framework so that American plaintiffs will have a variety of acceptable methods of service, even when relations with the foreign country in question are strained; at the same time, the framework is designed to insure that foreign defendants will get notice. There is no excuse for departure from the dictates of the statute. Here, the record shows that Harris requested approval of a method of service under § 1608(b)(3)(C) at one time, but it apparently did not pursue that request. Similarly, Harris should have complied more closely with § 1608(b)(3)(B), by getting the clerk of the court to dispatch the registered mail. While this step would not have eliminated the problem of obtaining signed receipts for the mail, it would be better than having only an affidavit stating that the mail was sent.
17Observing that § 1605 requires a connection between the lawsuit and the United States, the appellants assert that Congress, by adopting a special jurisdictional statute, “has authorized the exercise of less than the complete personal jurisdiction that might constitutionally be afforded American courts under traditional concepts of fairness and due process.” Harris v. VAO Intourist, 481 F.Supp. 1056 (1979). However, the appellants’ argument is of no avail at this point, for we have found jurisdiction through § 1605(a)(2). See p. 1351 supra. If the appellants’ argument is correct, it may be that an inquiry into traditional due process requirements is unnecessary once the narrower requirements for subject matter jurisdiction are found. But see Texas Trading, 647 F.2d at 307 (“Congress has only an incomplete power to tie personal jurisdiction to subject matter jurisdiction ... [since] its prerogatives are constrained by the due process clause,” thus a separate due process inquiry is necessary.). We need not resolve this point, for our due process findings would be necessary to validate the exercise of jurisdiction through waiver by treaty. See generally Harris, 481 F.Supp. at 1059-60.
18NIRT’s objection to the court’s exercise of jurisdiction over the parties was limited solely to an attack on service of process, which we have already resolved against it. The objection to service of process does not preserve the issue of personal jurisdiction. Section 1330(b) states that service is necessary to acquire personal jurisdiction, thus making service of process a requisite to personal jurisdiction; however, that is not different from traditional jurisdictional concepts, see generally, eg., C. Wright, Handbook of the Law of Federal Courts, 301 (3d ed. 1976), and challenges to service remain, as always, distinct from challenges to jurisdiction over the person. See Fed.R.Civ.P. 12(b), 12(h)(1).
19As did the parties, we use the “fraud in the transaction” terminology broadly to encompass any type of fraudulent conduct in the letter of credit transaction. (U.C.C. § 5-114(2) uses the term to describe a sort of fraud external to the complying documents presented to an issuer as a part of a demand for payment on a letter of credit.) The U.C.P. is silent on the availability of remedies to a plaintiff alleging that fraud is involved in a beneficiary’s demand on a letter of credit. Nonetheless, we are of the opinion that the “fraud in the transaction” doctrine as it has been developed in commercial law, and as it is now reflected in U.C.C. § 5-114(2), is applicable in a case such as this, where the appellants have not alleged and shown that foreign law controls and makes resort to the doctrine impermissible. Cf. KMW International v. Chase Manhattan Bank, 606 F.2d 10, 15 n. 3 (2d Cir. 1979) (applicability of U.C.P. rather than U.C.C. ‘‘does not ... take away from the point that apparent ‘fraud in the transaction’ or fraudulent documentation may be a defense under Reuther the U.C.C. or the U.C.P."); United Bank Ltd. v. Cambridge Sporting Goods Corp., 41 N.Y.2d 254, 360 N.E.2d 943, 947 N. 2, 392 N.Y.S.2d 265 (1976) ("The Uniform Customs and Practice, where applicable, does not bar the relief provided for in section 5-114 of the code"). Other courts in the United States have consistently reached this result. See Comment, Enjoining the International Standby Letter of Credit: The Iranian Letter of Credit Cases, 21 Harv. Int'l L-J. 189, 202-03 & n. 69 (1980) (criticizing the courts for failing to consider the foreign law might apply).
20See note 5 supra. Melli points out that the provision requires written notice within ten days of force majeure in order to terminate the contract and argues that Harris did not attempt to give such notice to NIRT until July 23, 1980, well after the Iranian revolution and NIRT’s demand on the guarantee. The facts suggest, however, that Harris initially did not consider the force majeure to constitute anything more than cause for delay under the contract. Apparently, only after Harris learned that NIRT had presented Melli with a written declaration of Harris’s default (in June of 1979) did Harris realize that NIRT considered continued operations impossible and determined that force majeure prevented completion of the contract. By that time, of course, NIRT had received notice of force majeure and had apparently acknowledged its existence, see pp. 1347-1348 supra, thus NIRT might be deemed to have waived any further notice required under the contract. This sequence of events sufficiently shows that NIRT’s demand on the guarantee letter of credit was made with actual knowledge of the existence of conditions that excused further performance by Harris.
21The appellants have, of course, cited other cases involving Iranian letters of credit where courts have found that the “fraud in the transaction” exception did not apply. The cases presented, however, do not involve the same, or even a very similar, combination of the beneficiary’s conduct, the terms of the contract, and the terms of the demand document as we have before us. See, e.g., KMW Int’l v. Chase Manhattan Bank, 606 F.2d 10 (2d Cir. 1979) (no demand on the letter of credit); American Bell Int’l, Inc. v. Islamic Republic of Iran, 474 F.Supp. 420, 424-25 (S.D.N.Y.1979) (insuffi- cient showing of fraud where letter of credit provided for immediate payment on demand, without regard to cause); United Technologies Corp. v. Citibank, 469 F.Supp. 473 (S.D.NLY. 1979) (no recognition by beneficiary of any condition excusing contract performance); Balfour Machine Int’l, Ltd. v. Manufacturers Hanover Trust Co., No. 20801/78 (N.Y.Sup.Ct., N.Y. County July 13, 1979) (lacked requisite allegations of fraud). See generally Comment, supra note 19, 21 Harv. Int'l L.J. at 248-52. We reject any implication, purportedly drawn from the opinions in such cases, that an injunction should not be available under the facts of this case.
1The preliminary injunction also (a) directs Harris to maintain a blocked account in the amount of the letter of credit, $674,035.20, in accordance with the Iranian Assets Control Regulations, 31 C.F.R. § 535.568 (1980), (b) enjoins distribution or removal of any funds from the blocked account, (c) directs the attachment of the blocked account for Harris’s benefit, and (d) continues a bond requirement of $674,035.20. Appellants do not challenge these provisions.
2Upon shipment of the equipment and receipt of the training, NIRT paid 80% of the price and deducted the remaining 20% from the advance payment. As to services, NIRT paid 90% of the invoice price and deducted 10% from the advance. For NIRT’s protection in case the contract terminated prior to full performance, the contract required that Harris obtain a guarantee letter of credit which would provide that advance payment not yet liquidated would be returned to NIRT. The central bank of Iran, Bank Markazi, issued the guarantee in the amount of $1,331,470.40; Harris’s performance has amortized all but $69,559 of the advance payment and the guarantee has been reduced accordingly. That guarantee letter of credit is not involved here. Harris does not seek damages in this action, but it contends that NIRT owes $128,410 for training which was completed in February, 1979. Also, NIRT has not paid for certain transmitters which have been completed but not shipped.
3The agreement is a standby letter of credit; it will be referred to herein as a performance guarantee or a guarantee letter of credit in order more easily to distinguish it from the standby letter of credit issued by Continental Bank in favor of Bank Melli. For an explanation of the operation of standby letters of credit and a comparison of standbys with traditional, commercial letters of credit, see Comment, Enjoining the International Standby Letter of Credit: The Iranian Letter of Credit Cases, 21 Harv. Int'l L.J. 189, 190-200 (1980).
4“The term ‘contract documents’ shall mean the following documents, which shall be deemed as an integral part of this contract: ... [6] the bank guarantees ....”’ Contract.
5The following paragraphs in the contract deal with force majeure and termination of the contract: 11-5 The contractor shall not be liable for any excess cost or for liquidated damage for delay if any failure to perform the contract arises out of force majeure acts of nature, or of government, fires, floods, epidemics, quarantins [sic] restrictions, to [sic] any such causes unless NIRT shall determine that the materials or equipment or services to be furnished by the contractor were obtainable from other source [sic] in sufficient time to permit the contractor to meet the required time schedule, provided that the contractor shall within (10) ten days from the beginning of such delay, notify NIRT in writing of the causes of the delay. NIRT shall ascertain the facts and the extent of the delay and extend the time for completing the work as its judgment and finding justify. In any event the contractor shall make every effort to overcome the causes of delay or to arrange substitute procedure and shall continue to perform his obligations to the extent he can. 11-6 If, arriving at any cause as set forth in paragraph 11-5 above, the contractor finds it impractical to continue operations, or if owing to force majeure or to any cause beyond NIRT’s control, NIRT finds it impossible to continue operations, then prompt notification, in writing, shall be given by the party affected to the other. If the difficulties or delay caused by force majeure cannot be expected to ease or be- come available, or if operations cannot be resumed within (6) six months, then either party shall have the right to terminate the contract upon (10) ten days written notice to the other. In the event of termination of the contract under this paragraph, payment will be made to the contractor as follows: (a) The contractor will be paid for all work completed as shown by the progress reports and for all reimbursable expenses due and unpaid. ‘Reimbursable expenses”’ means all expenses for service, material, equipment completed at the date of notification to terminate the contract and payment of which is pending under normal contractual terms. However, NIRT undertakes to pay for contractual equipment which was delivered, shipped, or ready for shipment, or within the production time, only according to the contract unit prices. (b) The contractor will also be paid for any work done during the said (6) six months period as well as for settlement of any financial commitments made in connection with the proper performance of the contract and not reasonably defrayed by payments under (a) above. (c) NIRT will also release all bonds and guarantee unless the total amount of payment previously paid to the contractor exceeds the final amount due to him, in which case, the contractor shall refund the excess within (60) days after termination, against the release of bonds and guarantee furnished to NIRT.
6President Carter declared a national emergency on November 14, 1979, and blocked the removal or transfer of Iranian assets. Exec. Order No. 12,170, 3 C.F.R. 457 (1980). To implement the blocking order, the Treasury Department promulgated the Iranian Assets Control Regulations, 31 C.F.R. §§ 535.101-904 (1981).
7The contract allowed NIRT to terminate the whole or any part of the contract, by written notice of default to Harris, under the following circumstances: (a) If in the judgment of NIRT the contractor fails to make delivery of material and equipment or to perform installations supervisory work or services within the time specified herein or any extension thereof. (b) If in the judgment of NIRT the contractor fails to perform any of the other provisions of this contract, or so fails to make progress as to endanger performance of the contract or completion of the work within the time specified herein or any extension thereof, and does not remedy such failure within a period of (30) thirty days (or such longer period as NIRT may authorize in writing) after receipt of notice from NIRT specifying such failure. Harris never received notice from NIRT under this provision of the contract.
8Harris states that Melli had already made four improper demands to extend or pay the guarantee in early 1979. Continental Bank advised Harris that the demands were nonconforming, and NIRT officials told Blaha that they were unaware of Melli’s demands. Melli abandoned the prior demands.
9Following entry of the TRO, Harris advised Continental Bank that payment on the letter of credit would aid and abet violation of the restraint imposed on Melli. Continental Bank responded that Harris’s creation of a blocked account “discharged” Continental’s obligation under the letter of credit and that Continental had so advised Melli.
10See p. 1346 & n. 1 supra.
11As indicated, § 1330(a) refers to exceptions to immunity under §§ 1605-1607 and under any applicable international agreement. To some extent, these two sources overlap. Section 1605(a)(1) of the FSIA deals with explicit and implied waivers of foreign immunity by sovereign states, and the House Report accompanying the FSIA contemplates that treaties can constitute explicit waivers: “With respect to explicit waivers, a foreign state may announce its immunity by treaty, as has been done by the United States with respect to commercial and other activities in a series of treaties of friendship, commerce, and navigation..." H.R. Rep. No. 1487, 94th Cong., 2d Sets. 18, reprinted in [1976] U.S.Code Cong. and Ad.News 6604, 6617.
12See pp. 1352-1353 infra.
13The requirement of commercial activity, as opposed to governmental acts, reflects the restrictive theory of sovereign immunity on which the FSIA is based. See House Report at 14, [1976] U.S.Code Cong. and Ad.News at 6613.
14“A ‘commercial activity’ means either a regular course of commercial conduct or a particular commercial transaction or act.” 28 U.S.C. § 1603(d). For an analysis of ‘commercial activity,” see Texas Trading and Milling Corp. v. Federal Republic of Nigeria, 647 F.2d 300, 307- 10 (2d Cir. 1981), cert. denied, 454 U.S. 1148, 102 S.Ct. 1012, 71 L.Ed.2d 301 (1982).
15Those methods were: (1) transmitting by telex to NIRT on June 12, 1980, the summons, notice of suit, and notice that pleadings would be sent by registered mail in English and Farsi transliteration (in accordance with the substitute service order in New England Merchants Nat’l Bank v. Iran Power Generation & Transmission Co., 495 F.Supp. 73 (S.D.N.Y. 1980)); (2) sending the summons, complaint and notice of suit in English and Farsi by registered mail to NIRT in Iran and to the Office of Consular Service for transmittal through diplomatic channels; and (3) delivering copies of the pleadings and preliminary injunction papers to Abourezk, Shack & Mendenhall, P.C., the firm which was coordinating Iranian litigation on behalf of Iran. (The Abourezk firm appeared at the preliminary hearing and represents NIRT in this appeal.)
16Though we find service adequate here, we admonish those seeking to invoke the FSIA to follow the service provisions it contains. Congress has carefully established a flexible framework so that American plaintiffs will have a variety of acceptable methods of service, even when relations with the foreign country in question are strained; at the same time, the framework is designed to insure that foreign defendants will get notice. There is no excuse for departure from the dictates of the statute. Here, the record shows that Harris requested approval of a method of service under § 1608(b)(3)(C) at one time, but it apparently did not pursue that request. Similarly, Harris should have complied more closely with § 1608(b)(3)(B), by getting the clerk of the court to dispatch the registered mail. While this step would not have eliminated the problem of obtaining signed receipts for the mail, it would be better than having only an affidavit stating that the mail was sent.
17Observing that § 1605 requires a connection between the lawsuit and the United States, the appellants assert that Congress, by adopting a special jurisdictional statute, “has authorized the exercise of less than the complete personal jurisdiction that might constitutionally be afforded American courts under traditional concepts of fairness and due process.” Harris v. VAO Intourist, 481 F.Supp. 1056 (1979). However, the appellants’ argument is of no avail at this point, for we have found jurisdiction through § 1605(a)(2). See p. 1351 supra. If the appellants’ argument is correct, it may be that an inquiry into traditional due process requirements is unnecessary once the narrower requirements for subject matter jurisdiction are found. But see Texas Trading, 647 F.2d at 307 (“Congress has only an incomplete power to tie personal jurisdiction to subject matter jurisdiction ... [since] its prerogatives are constrained by the due process clause,” thus a separate due process inquiry is necessary.). We need not resolve this point, for our due process findings would be necessary to validate the exercise of jurisdiction through waiver by treaty. See generally Harris, 481 F.Supp. at 1059-60.
18NIRT’s objection to the court’s exercise of jurisdiction over the parties was limited solely to an attack on service of process, which we have already resolved against it. The objection to service of process does not preserve the issue of personal jurisdiction. Section 1330(b) states that service is necessary to acquire personal jurisdiction, thus making service of process a requisite to personal jurisdiction; however, that is not different from traditional jurisdictional concepts, see generally, eg., C. Wright, Handbook of the Law of Federal Courts, 301 (3d ed. 1976), and challenges to service remain, as always, distinct from challenges to jurisdiction over the person. See Fed.R.Civ.P. 12(b), 12(h)(1).
19As did the parties, we use the “fraud in the transaction” terminology broadly to encompass any type of fraudulent conduct in the letter of credit transaction. (U.C.C. § 5-114(2) uses the term to describe a sort of fraud external to the complying documents presented to an issuer as a part of a demand for payment on a letter of credit.) The U.C.P. is silent on the availability of remedies to a plaintiff alleging that fraud is involved in a beneficiary’s demand on a letter of credit. Nonetheless, we are of the opinion that the “fraud in the transaction” doctrine as it has been developed in commercial law, and as it is now reflected in U.C.C. § 5-114(2), is applicable in a case such as this, where the appellants have not alleged and shown that foreign law controls and makes resort to the doctrine impermissible. Cf. KMW International v. Chase Manhattan Bank, 606 F.2d 10, 15 n. 3 (2d Cir. 1979) (applicability of U.C.P. rather than U.C.C. ‘‘does not ... take away from the point that apparent ‘fraud in the transaction’ or fraudulent documentation may be a defense under Reuther the U.C.C. or the U.C.P."); United Bank Ltd. v. Cambridge Sporting Goods Corp., 41 N.Y.2d 254, 360 N.E.2d 943, 947 N. 2, 392 N.Y.S.2d 265 (1976) ("The Uniform Customs and Practice, where applicable, does not bar the relief provided for in section 5-114 of the code"). Other courts in the United States have consistently reached this result. See Comment, Enjoining the International Standby Letter of Credit: The Iranian Letter of Credit Cases, 21 Harv. Int'l L-J. 189, 202-03 & n. 69 (1980) (criticizing the courts for failing to consider the foreign law might apply).
20See note 5 supra. Melli points out that the provision requires written notice within ten days of force majeure in order to terminate the contract and argues that Harris did not attempt to give such notice to NIRT until July 23, 1980, well after the Iranian revolution and NIRT’s demand on the guarantee. The facts suggest, however, that Harris initially did not consider the force majeure to constitute anything more than cause for delay under the contract. Apparently, only after Harris learned that NIRT had presented Melli with a written declaration of Harris’s default (in June of 1979) did Harris realize that NIRT considered continued operations impossible and determined that force majeure prevented completion of the contract. By that time, of course, NIRT had received notice of force majeure and had apparently acknowledged its existence, see pp. 1347-1348 supra, thus NIRT might be deemed to have waived any further notice required under the contract. This sequence of events sufficiently shows that NIRT’s demand on the guarantee letter of credit was made with actual knowledge of the existence of conditions that excused further performance by Harris.
21The appellants have, of course, cited other cases involving Iranian letters of credit where courts have found that the “fraud in the transaction” exception did not apply. The cases presented, however, do not involve the same, or even a very similar, combination of the beneficiary’s conduct, the terms of the contract, and the terms of the demand document as we have before us. See, e.g., KMW Int’l v. Chase Manhattan Bank, 606 F.2d 10 (2d Cir. 1979) (no demand on the letter of credit); American Bell Int’l, Inc. v. Islamic Republic of Iran, 474 F.Supp. 420, 424-25 (S.D.N.Y.1979) (insuffi- cient showing of fraud where letter of credit provided for immediate payment on demand, without regard to cause); United Technologies Corp. v. Citibank, 469 F.Supp. 473 (S.D.NLY. 1979) (no recognition by beneficiary of any condition excusing contract performance); Balfour Machine Int’l, Ltd. v. Manufacturers Hanover Trust Co., No. 20801/78 (N.Y.Sup.Ct., N.Y. County July 13, 1979) (lacked requisite allegations of fraud). See generally Comment, supra note 19, 21 Harv. Int'l L.J. at 248-52. We reject any implication, purportedly drawn from the opinions in such cases, that an injunction should not be available under the facts of this case.