| (1) |
Except as otherwise provided in Section 70A-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. |
Terms Used In Utah Code 70A-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 Utah Code 70A-5-102
- Letter of credit: means a definite undertaking that satisfies the requirements of Section 70A-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 Utah Code 70A-5-102
| (2) |
Even if a letter of credit provides that it is transferable, the issuer may refuse to recognize or carry out a transfer if:
| (a) |
the transfer would violate applicable law; or |
| (b) |
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 70A-5-108(5) or is otherwise reasonable under the circumstances. |
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Repealed and Re-enacted by Chapter 241, 1997 General Session
