Wis. Stat. § 405.116
Choice of law and forum
Redline — January 1, 2003 → current.View current text →
Current — January 1, 2005
As of January 1, 2003
(1) The right to draw under a credit can be transferred or assigned only when the credit is expressly designated as transferable or assignable.
(2) Even though the credit specifically states that it is nontransferable or nonassignable, the beneficiary may assign the beneficiary's right to proceeds before performance of the conditions of the credit. Such an assignment is an assignment of an account under ch. 409 and is governed by that chapter except that:
(a) The assignment is ineffective until the letter of credit or advice of credit is delivered to the assignee which delivery constitutes perfection of the security interest under ch. 409 ; and
(b) The issuer may honor drafts or demands for payment drawn under the credit until it receives a notification of the assignment signed by the beneficiary which reasonably identifies the credit involved in the assignment and contains a request to pay the assignee; and
(c) After what reasonably appears to be such a notification has been received the issuer may without dishonor refuse to accept or pay even to a person otherwise entitled to honor until the letter of credit or advice of credit is exhibited to the issuer.
(3) Except where the beneficiary has effectively assigned the beneficiary's right to draw or to proceeds, nothing in this section limits the beneficiary's right to transfer or negotiate drafts or demands drawn under the credit.
(1) The liability of an issuer, nominated person, or adviser for action or omission is governed by the law of the jurisdiction chosen by an agreement in the form of a record signed or otherwise authenticated by the affected parties in the manner provided in s. 405.104 or by a provision in the person's letter of credit, confirmation, or other undertaking. The jurisdiction whose law is chosen need not bear any relation to the transaction.
(2) Unless sub. (1) applies, the liability of an issuer, nominated person, or adviser for action or omission is governed by the law of the jurisdiction in which the person is located. The person is considered to be located at the address indicated in the person's undertaking. If more than one address is indicated, the person is considered to be located at the address from which the person's undertaking was issued. For the purpose of jurisdiction, choice of law, and recognition of interbranch letters of credit, but not enforcement of a judgment, all branches of a bank are considered separate juridical entities and a bank is considered to be located at the place where its relevant branch is considered to be located under this subsection.
(3) Except as otherwise provided in this subsection, the liability of an issuer, nominated person, or adviser is governed by any rules of custom or practice, such as the Uniform Customs and Practice for Documentary Credits, to which the letter of credit, confirmation, or other undertaking is expressly made subject. If this chapter would govern the liability of an issuer, nominated person, or adviser under sub. (1) or (2) , if the relevant undertaking incorporates rules of custom or practice, and if there is conflict between this chapter and those rules as applied to that undertaking, those rules govern except to the extent of any conflict with the nonvariable provisions specified in s. 405.103 (3) .
(4) If there is conflict between this chapter and ch. 403 , 404 , 409 , or 410 , this chapter governs.
(5) The forum for settling disputes arising out of an undertaking within this chapter may be chosen in the manner and with the binding effect that governing law may be chosen in accordance with sub. (1) .
Official source: Wisconsin State Legislature. Reproduced from public-domain Wisconsin statutes; confirm against the official source for the current text. Not legal advice.