Wis. Stat. § 405.103

Scope

Redline — January 1, 2003 → current.View current text →

Current — January 1, 2011

As of January 1, 2003

(1) In this chapter unless the context otherwise requires:

(a) An "advising bank" is a bank which gives notification of the issuance of a credit by another bank.

(b) A "beneficiary" of a credit is a person who is entitled under its terms to draw or demand payment.

(c) A "confirming bank" is a bank which engages either that it will itself honor a credit already issued by another bank or that such a credit will be honored by the issuer or a third bank.

(d) "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 chapter ( s. 405.102 ) that the issuer will honor drafts or other demands for payment upon compliance with the conditions specified in the credit. A credit may be either revocable or irrevocable. The engagement may be either an agreement to honor or a statement that the bank or other person is authorized to honor.

(e) A "customer" is a buyer or other person who causes an issuer to issue a credit. The term also includes a bank which procures issuance or confirmation on behalf of that bank's customer.

(f) A "documentary draft" or "documentary demand for payment" is one the honor of which is conditioned upon the presentation of a document or documents. "Document" means any paper including document of title, security, invoice, certificate, notice of default and the like.

(g) An "issuer" is a bank or other person issuing a credit.

(2) Other definitions applying to this chapter and the sections in which they appear are:

(a) "Notation of credit" — s. 405.108 .

(b) "Presenter" — s. 405.112 (3) .

(3) Definitions in other chapters applying to this chapter and the sections in which they appear are:

(a) "Acceptance" — s. 403.409 (1) .

(b) "Contract for sale" — s. 402.106 .

(d) "Holder in due course" — s. 403.302 .

(e) "Midnight deadline" — s. 404.104 .

(f) "Security" — s. 408.102 .

(4) In addition, ch. 401 contains general definitions and principles of construction and interpretation applicable throughout this chapter.

(1) This chapter applies to letters of credit and to certain rights and obligations arising out of transactions involving letters of credit.

(2) The statement of a rule in this chapter does not by itself require, imply, or negate application of the same or a different rule to a situation not provided for, or to a person not specified, in this chapter.

(3) With the exception of this subsection, subs. (1) and (4) , ss. 405.102 (1) (i) and (j) , 405.106 (4) and 405.114 (4) , and except to the extent prohibited in ss. 401.302 and 405.117 (4) , the effect of this chapter may be varied by agreement or by a provision stated or incorporated by reference in an undertaking. A term in an agreement or undertaking generally excusing liability or generally limiting remedies for failure to perform obligations is not sufficient to vary obligations prescribed by this chapter.

(4) Rights and obligations of an issuer to a beneficiary or a nominated person under a letter of credit are independent of the existence, performance, or nonperformance of a contract or arrangement out of which the letter of credit arises or which underlies it, including contracts or arrangements between the issuer and the applicant and between the applicant and the beneficiary.

Official source: Wisconsin State Legislature. Reproduced from public-domain Wisconsin statutes; confirm against the official source for the current text. Not legal advice.