Title 13 — Uniform Commercial Code
10 chapters · 414 sections in this title.
13 GCA § 5101 Short Title
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This division shall be known and may be cited as Uniform Commercial Code -- Letters of Credit.
13 GCA § 5102 Scope
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(1) This division applies (a) To a credit issued by a bank if the credit requires a documentary draft or a documentary demand for payment; and (b) To a credit issued by a person other than a bank if the credit requires that the draft or demand for payment be accompanied by a docu…
13 GCA § 5103 Definitions
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(1) In this division unless the context otherwise requires (a) Credit or letter of credit means an engagement by a bank or other person made at the request of a customer and of a kind within the scope of this division (Section 5102) that the issuer will honor drafts or other dema…
13 GCA § 5104 Formal Requirements; Signing
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(1) Except as otherwise required in subdivision (1) (c) of Section 5102 on scope, no particular form of phrasing is required for a credit. A credit must be in writing and signed by the issuer and a confirmation must be in writing and signed by the confirming bank. A modification …
13 GCA § 5105 Consideration
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No consideration is necessary to establish a credit or to enlarge or otherwise modify its terms.
13 GCA § 5106 Time and Effect of Establishment of Credit
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COL120106 (1) Unless otherwise agreed a credit is established (a) As regards the customer as soon as a letter of credit is sent to him or the letter of credit or an authorized written advice of its issuance is sent to the beneficiary; and (b) As regards the beneficiary when he re…
13 GCA § 5107 Advice of Credit; Confirmation; Error in Statement of
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Terms. (1) Unless otherwise specified an advising bank by advising a credit issued by another bank does not assume any obligation to honor drafts drawn or demands for payment made under the credit but it does assume obligation for the accuracy of its own statement. (2) A confirmi…
13 GCA § 5108 Notation Credit; Exhaustion of Credit
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COL120106 (1) A credit which specifies that any person purchasing or paying drafts drawn or demands for payment made under it must note the amount of the draft or demand on the letter or advice of credit is a notation credit. (2) Under a notation credit (a) A person paying the be…
13 GCA § 5109 Issuer's Obligation to Its Customer
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(1) An issuer's obligation to its customer includes good faith and observance of any general banking usage but unless otherwise agreed does not include liability or responsibility (a) For performance of the underlying contract for sale or other transaction between the customer an…
13 GCA § 5110 Availability of Credit in Portions; Presenter's Reservation of
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Lien or Claim. (1) Unless otherwise specified a credit may be used in portions in the discretion of the beneficiary. (2) Unless otherwise specified a person by presenting a documentary draft or demand for payment under a credit relinquishes upon its honor all claims to the docume…
13 GCA § 5111 Warranties on Transfer and Presentment
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(1) Unless otherwise agreed the beneficiary by transferring or presenting a documentary draft or demand for payment warrants to all interested parties that the necessary conditions of the credit have been complied with. This is in addition to any warranties arising under Division…
13 GCA § 5112 Time Allowed for Honor or Rejection; Withholding Honor or
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Rejection by Consent; Presenter. (1) A bank to which a documentary draft or demand for payment is presented under a credit may without dishonor of the draft, demand or credit COL120106 (a) Defer honor until the close of the third banking day following receipt of the documents; an…
13 GCA § 5113 Indemnities
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(1) A bank seeking to obtain (whether for itself or another) honor, negotiation or reimbursement under a credit may give an indemnity to induce such honor, negotiation or reimbursement. (2) An indemnity agreement inducing honor, negotiation or reimbursement unless otherwise expli…
13 GCA § 5114 Issuer's Duty and Privilege to Honor; Right to
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Reimbursement. (1) An issuer must honor a draft or demand for payment which complies with the terms of the relevant credit regardless of whether the goods or documents conform to the underlying contract for sale or other contract between the customer and the beneficiary. The issu…
13 GCA § 5115 Remedy for Improper Dishonor or Anticipatory Repudiation
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(1) When an issuer wrongfully dishonors a draft or demand for payment presented under a credit the person entitled to honor has with respect to any documents the rights of a person in the position of a seller (Section 2707) and may recover from the issuer the face amount of the d…
13 GCA § 5116 Transfer and Assignment
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(1) The right to draw under a credit can be transferred or assigned only when the credit is expressly designated as transferable or assignable. COL120106 (2) Even though the credit specifically states that it is nontransferable or nonassignable the beneficiary may before performa…
13 GCA § 5117 Insolvency of Bank Holding Funds for Documentary Credit
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(1) Where an issuer or an advising or confirming bank or a bank which has for customer procured issuance of a credit by another bank becomes insolvent before final payment under the credit and the credit is one to which this division is made applicable by paragraph (a) or (b) of …