Kentucky Statutes 355.2-325 – “Letter of credit” term — “Confirmed credit.”
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(1) Failure of the buyer seasonably to furnish an agreed letter of credit is a breach of the contract for sale.
(2) The delivery to seller of a proper letter of credit suspends the buyer’s obligation to pay. If the letter of credit is dishonored, the seller may on seasonable notification to the buyer require payment directly from him.
(3) Unless otherwise agreed the term “letter of credit” or “banker’s credit” in a contract for sale means an irrevocable credit issued by a financing agency of good repute and where the shipment is overseas, of good international repute. The term “confirmed credit” means that the credit must also carry the direct obligation of such an agency which does business in the seller’s financial market.
Effective: July 1, 1960
History: Created 1958 Ky. Acts ch. 77, sec. 2-235, effective July 1, 1960.
(2) The delivery to seller of a proper letter of credit suspends the buyer’s obligation to pay. If the letter of credit is dishonored, the seller may on seasonable notification to the buyer require payment directly from him.
Terms Used In Kentucky Statutes 355.2-325
- Buyer: means a person who buys or contracts to buy goods. See Kentucky Statutes 355.2-103
- Contract: A legal written agreement that becomes binding when signed.
- Contract for sale: includes both a present sale of goods and a contract to sell goods at a future time. See Kentucky Statutes 355.2-106
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Seller: means a person who sells or contracts to sell goods. See Kentucky Statutes 355.2-103
(3) Unless otherwise agreed the term “letter of credit” or “banker’s credit” in a contract for sale means an irrevocable credit issued by a financing agency of good repute and where the shipment is overseas, of good international repute. The term “confirmed credit” means that the credit must also carry the direct obligation of such an agency which does business in the seller’s financial market.
Effective: July 1, 1960
History: Created 1958 Ky. Acts ch. 77, sec. 2-235, effective July 1, 1960.