70A-5-113 - Transfer by operation of law.
70A-5-113. Transfer by operation of law.
(1) A successor of a beneficiary may consent to amendments, sign and presentdocuments, and receive payment or other items of value in the name of the beneficiary withoutdisclosing its status as a successor.
(2) A successor of a beneficiary may consent to amendments, sign and presentdocuments, and receive payment or other items of value in its own name as the disclosedsuccessor of the beneficiary. Except as otherwise provided in Subsection (5), an issuer shallrecognize a disclosed successor of a beneficiary as beneficiary in full substitution for itspredecessor upon compliance with the requirements for recognition by the issuer of a transfer ofdrawing rights by operation of law under the standard practice referred to in Subsection70A-5-108(5) or, in the absence of such a practice, compliance with other reasonable proceduressufficient to protect the issuer.
(3) An issuer is not obliged to determine whether a purported successor is a successor ofa beneficiary or whether the signature of a purported successor is genuine or authorized.
(4) Honor of a purported successor's apparently complying presentation under Subsection(1) or (2) has the consequences specified in Subsection 70A-5-108(9) even if the purportedsuccessor is not the successor of a beneficiary. Documents signed in the name of the beneficiaryor of a disclosed successor by a person who is neither the beneficiary nor the successor of thebeneficiary are forged documents for the purposes of Section 70A-5-109.
(5) An issuer whose rights of reimbursement are not covered by Subsection (4) orsubstantially similar law and any confirmer or nominated person may decline to recognize apresentation under Subsection (2).
(6) A beneficiary whose name is changed after the issuance of a letter of credit has thesame rights and obligations as a successor of a beneficiary under this section.
Repealed and Re-enacted by Chapter 241, 1997 General Session