New Jersey Statutes 12A:5-112. Transfer of letter of credit
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Terms Used In New Jersey Statutes 12A:5-112
- Issuer: means a bank or other person that issues a letter of credit, but does not include an individual who makes an engagement for personal, family, or household purposes. See New Jersey Statutes 12A:5-102
- Letter of credit: means a definite undertaking that satisfies the requirements of 12A:5-104 by an issuer to a beneficiary at the request or for the account of an applicant or, in the case of a financial institution, to itself or for its own account, to honor a documentary presentation by payment or delivery of an item of value. See New Jersey Statutes 12A:5-102
12A:5-112. Transfer of Letter of Credit.
a. Except as otherwise provided in 12A:5-113, unless a letter of credit provides that it is transferable, the right of a beneficiary to draw or otherwise demand performance under a letter of credit may not be transferred.
b. Even if a letter of credit provides that it is transferable, the issuer may refuse to recognize or carry out a transfer if:
(1) the transfer would violate applicable law; or
(2) the transferor or transferee has failed to comply with any requirement stated in the letter of credit or any other requirement relating to transfer imposed by the issuer which is within the standard practice referred to in subsection e. of 12A:5-108 or is otherwise reasonable under the circumstances.
a. Except as otherwise provided in 12A:5-113, unless a letter of credit provides that it is transferable, the right of a beneficiary to draw or otherwise demand performance under a letter of credit may not be transferred.
b. Even if a letter of credit provides that it is transferable, the issuer may refuse to recognize or carry out a transfer if:
(1) the transfer would violate applicable law; or
(2) the transferor or transferee has failed to comply with any requirement stated in the letter of credit or any other requirement relating to transfer imposed by the issuer which is within the standard practice referred to in subsection e. of 12A:5-108 or is otherwise reasonable under the circumstances.
L.1997,c.395,s.1.