Wis. Stat. § 405.113
Transfer by operation of law
Redline — January 1, 2003 → current.View current text →
Current — January 1, 2005
As of January 1, 2003
(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:
(a) Unless otherwise explicitly agreed, applies to defects in the documents but not in the goods; and
(b) Unless a longer time is explicitly agreed, expires at the end of 10 business days following receipt of the documents by the ultimate customer unless notice of objection is sent before the expiration date. The ultimate customer may send notice of objection to the person from whom the ultimate customer received the documents and any bank receiving the notice is under a duty to send notice to its transferor before its midnight deadline.
(1) A successor of a beneficiary may consent to amendments, sign and present documents, and receive payment or other items of value in the name of the beneficiary without disclosing its status as a successor.
(2) A successor of a beneficiary may consent to amendments, sign and present documents, and receive payment or other items of value in its own name as the disclosed successor of the beneficiary. Except as otherwise provided in sub. (5) , an issuer shall recognize a disclosed successor of a beneficiary as beneficiary in full substitution for its predecessor upon compliance with the requirements for recognition by the issuer of a transfer of drawing rights by operation of law under the standard practice referred to in s. 405.108 (5) or, in the absence of such a practice, compliance with other reasonable procedures sufficient to protect the issuer.
(3) An issuer is not obliged to determine whether a purported successor is a successor of a beneficiary or whether the signature of a purported successor is genuine or authorized.
(4) Honor of a purported successor's apparently complying presentation under sub. (1) or (2) has the consequences specified in s. 405.108 (9) even if the purported successor is not the successor of a beneficiary. Documents signed in the name of the beneficiary or of a disclosed successor by a person who is neither the beneficiary nor the successor of the beneficiary are forged documents for the purposes of s. 405.109 .
(5) An issuer whose rights of reimbursement are not covered by sub. (4) or substantially similar law and any confirmer or nominated person may decline to recognize a presentation under sub. (2) .
(6) A beneficiary whose name is changed after the issuance of a letter of credit has the same rights and obligations as a successor of a beneficiary under this section.
Official source: Wisconsin State Legislature. Reproduced from public-domain Wisconsin statutes; confirm against the official source for the current text. Not legal advice.