§ 25-5-113. Transfer by operation of law. - North Carolina Statutes

§25‑5‑113.  Transfer by operation of law.

(a)        A successor of abeneficiary may consent to amendments, sign and present documents, and receivepayment or other items of value in the name of the beneficiary withoutdisclosing its status as a successor.

(b)        A successor of abeneficiary may consent to amendments, sign and present documents, and receivepayment or other items of value in its own name as the disclosed successor ofthe beneficiary. Except as otherwise provided in subsection (e) of thissection, an issuer shall recognize a disclosed successor of a beneficiary asbeneficiary in full substitution for its predecessor upon compliance with therequirements for recognition by the issuer of a transfer of drawing rights byoperation of law under the standard practice referred to in G.S. 25‑5‑108(e)or, in the absence of such a practice, compliance with other reasonableprocedures sufficient to protect the issuer.

(c)        An issuer is notobliged to determine whether a purported successor is a successor of a beneficiaryor whether the signature of a purported successor is genuine or authorized.

(d)        Honor of apurported successor's apparently complying presentation under subsection (a) or(b) of this section has the consequences specified in G.S. 25‑5‑108(i)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 bya person who is neither the beneficiary nor the successor of the beneficiaryare forged documents for the purposes of G.S. 25‑5‑109.

(e)        An issuer whoserights of reimbursement are not covered by subsection (d) of this section orsubstantially similar law and any confirmer or nominated person may decline torecognize a presentation under subsection (b) of this section.

(f)         A beneficiarywhose name is changed after the issuance of a letter of credit has the samerights and obligations as a successor of a beneficiary under this section. (1999‑73,s. 1.)