Michigan Laws 440.5110 – Warranties on presentment or transfer
Current as of: 2024 | Check for updates
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(1) If presentation is honored, the beneficiary warrants:
(a) To the issuer, any other person to whom presentation is made, and the applicant that there is no fraud or forgery of the kind described in section 5109(1).
Terms Used In Michigan Laws 440.5110
- Applicant: means a person at whose request or for whose account a letter of credit is issued. See Michigan Laws 440.5102
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Beneficiary: means a person who under the terms of a letter of credit is entitled to have its complying presentation honored. See Michigan Laws 440.5102
- Forgery: The fraudulent signing or alteration of another's name to an instrument such as a deed, mortgage, or check. The intent of the forgery is to deceive or defraud. Source: OCC
- Fraud: Intentional deception resulting in injury to another.
- Issuer: means a bank or other person that issues a letter of credit, but does not include an individual who makes an engagement for personal, family, or household purposes. See Michigan Laws 440.5102
- Letter of credit: means a definite undertaking that satisfies the requirements of section 5104 by an issuer to a beneficiary at the request or for the account of an applicant or, in the case of a financial institution, to itself or for its own account, to honor a documentary presentation by payment or delivery of an item of value. See Michigan Laws 440.5102
- Person: means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency, or instrumentality, public corporation, or any other legal or commercial entity. See Michigan Laws 440.1201
- Presentation: means delivery of a document to an issuer or nominated person for honor or giving of value under a letter of credit. See Michigan Laws 440.5102
(b) To the applicant that the drawing does not violate any agreement between the applicant and beneficiary or any other agreement intended by them to be augmented by the letter of credit.
(2) The warranties in subsection (1) are in addition to warranties arising under articles 3, 4, 7, and 8 because of the presentation or transfer of documents covered by any of those articles.