Maine Revised Statutes Title 11 Sec. 5-1111 – Remedies
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(1). If an issuer wrongfully dishonors or repudiates its obligation to pay money under a letter of credit before presentation, the beneficiary, successor or nominated person presenting on its own behalf may recover from the issuer the amount that is the subject of the dishonor or repudiation. If the issuer’s obligation under the letter of credit is not for the payment of money, the claimant may obtain specific performance or, at the claimant’s election, recover an amount equal to the value of performance from the issuer. In either case, the claimant may also recover incidental but not consequential damages. The claimant is not obligated to take action to avoid damages that might be due from the issuer under this subsection. If, although not obligated to do so, the claimant avoids damages, the claimant’s recovery from the issuer must be reduced by the amount of damages avoided. The issuer has the burden of proving the amount of damages avoided. In the case of repudiation, the claimant need not present any document.
[PL 1997, c. 429, Pt. A, §2 (NEW); PL 1997, c. 429, Pt. A, §4 (AFF).]
Terms Used In Maine Revised Statutes Title 11 Sec. 5-1111
- Adviser: means a person who, at the request of the issuer, a confirmer or another adviser, notifies or requests another adviser to notify the beneficiary that a letter of credit has been issued, confirmed or amended. See Maine Revised Statutes Title 11 Sec. 5-1102
- Applicant: means a person at whose request or for whose account a letter of credit is issued. See Maine Revised Statutes Title 11 Sec. 5-1102
- Confirmer: means a nominated person who undertakes, at the request or with the consent of the issuer, to honor a presentation under a letter of credit issued by another. See Maine Revised Statutes Title 11 Sec. 5-1102
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- Document: means a written draft or other demand, document of title, investment security, certificate, invoice or other record, statement or representation of fact, law, right or opinion that: (i) Is presented in a written or other medium permitted by the letter of credit or, unless prohibited by the letter of credit, by the standard practice referred to in section 5?1108, subsection (5); and(ii) Is capable of being examined for compliance with the terms and conditions of the letter of credit. See Maine Revised Statutes Title 11 Sec. 5-1102
- 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 Maine Revised Statutes Title 11 Sec. 5-1102
- Letter of credit: means a definite undertaking that satisfies the requirements of section 5?1104 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 Maine Revised Statutes Title 11 Sec. 5-1102
- Litigation: A case, controversy, or lawsuit. Participants (plaintiffs and defendants) in lawsuits are called litigants.
- Nominated person: means a person whom the issuer:
(i) Designates or authorizes to pay, accept, negotiate or otherwise give value under a letter of credit; and(ii) Undertakes by agreement or custom and practice to reimburse. See Maine Revised Statutes Title 11 Sec. 5-1102- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Presentation: means delivery of a document to an issuer or nominated person for honor or giving of value under a letter of credit. See Maine Revised Statutes Title 11 Sec. 5-1102
(2). If an issuer wrongfully dishonors a draft or demand presented under a letter of credit or honors a draft or demand in breach of its obligation to the applicant, the applicant may recover damages resulting from the breach, including incidental but not consequential damages, less any amount saved as a result of the breach.[PL 1997, c. 429, Pt. A, §2 (NEW); PL 1997, c. 429, Pt. A, §4 (AFF).]
(3). If an adviser or nominated person other than a confirmer breaches an obligation under this Article or an issuer breaches an obligation not covered in subsection (1) or (2), a person to whom the obligation is owed may recover damages resulting from the breach, including incidental but not consequential damages, less any amount saved as a result of the breach. To the extent of the confirmation, a confirmer has the liability of an issuer specified in this subsection and subsections (1) and (2).[PL 1997, c. 429, Pt. A, §2 (NEW); PL 1997, c. 429, Pt. A, §4 (AFF).]
(4). An issuer, nominated person or adviser who is found liable under subsection (1), (2) or (3) shall pay interest on the amount owed from the date of wrongful dishonor or other appropriate date.[PL 1997, c. 429, Pt. A, §2 (NEW); PL 1997, c. 429, Pt. A, §4 (AFF).]
(5). Reasonable attorney’s fees and other expenses of litigation must be awarded to the prevailing party in an action in which a remedy is sought under this Article.[PL 1997, c. 429, Pt. A, §2 (NEW); PL 1997, c. 429, Pt. A, §4 (AFF).]
(6). Damages that would otherwise be payable by a party for breach of an obligation under this Article may be liquidated by agreement or undertaking, but only in an amount or by a formula that is reasonable in light of the harm anticipated.[PL 1997, c. 429, Pt. A, §2 (NEW); PL 1997, c. 429, Pt. A, §4 (AFF).]
SECTION HISTORYPL 1997, c. 429, §A2 (NEW). PL 1997, c. 429, §A4 (AFF).