Colo. Rev. Stat. » Title 4

Colo. Rev. Stat. § 4-5-114

Assignment of proceeds

Find cases: SyfertCases citing this section CO-LEGleg.colorado.gov JustiaTitle on Justia CornellLII Search CasesGoogle Scholar

(a) In this section, "proceeds of a letter of credit" means the cash, check, accepted draft, or other item of value paid or delivered upon honor or giving of value by the issuer or any nominated person under the letter of credit. The term does not include a beneficiary's drawing rights or documents presented by the beneficiary. (b) A beneficiary may assign its right to part or all of the proceeds of a letter of credit. The beneficiary may do so before presentation as a present assignment of its right to receive proceeds contingent upon its compliance with the terms and conditions of the letter of credit. (c) An issuer or nominated person need not recognize an assignment of proceeds of a letter of credit until it consents to the assignment. (d) An issuer or nominated person has no obligation to give or withhold its consent to an assignment of proceeds of a letter of credit, but consent may not be unreasonably withheld if the assignee possesses and exhibits the letter of credit and presentation of the letter of credit is a condition to honor. (e) Rights of a transferee beneficiary or nominated person are independent of the beneficiary's assignment of the proceeds of a letter of credit and are superior to the assignee's right to the proceeds. (f) Neither the rights recognized by this section between an assignee and an issuer, transferee beneficiary, or nominated person nor the issuer's or nominated person's payment of proceeds to an assignee or a third person affect the rights between the assignee and any person other than the issuer, transferee beneficiary, or nominated person. The mode of creating and perfecting a security interest in or granting an assignment of a beneficiary's rights to proceeds is governed by article 9 of this title or other law. Against persons other than the issuer, transferee beneficiary, or nominated person, the rights and obligations arising upon the creation of a security interest or other assignment of a beneficiary's right to proceeds and its perfection are governed by article 9 of this title or other law.

Source: L. 96: Entire article R&RE, p. 199, § 1, effective July 1.

Editor's note: This section is similar to former § 4-5-116 as it existed prior to 1996.

Notes of Decisions
Cited in 5 cases, 1980–1988 · leading case: Colorado National Bank of Denver v. Board of County Commissioners
Sort: Relevance Newest Treatment
Colorado National Bank of Denver v. Board of County Commissioners (1981) colo · cites it 50× “In view of this independent nature of the letter of credit engagement the issuer is under a duty to honor the drafts for payment which in fact conform with the terms of the credit without reference to their compliance with the terms of the underlying contract.”
Board of County Commissioners v. Colorado National Bank of Denver (1980) coloctapp · cites it 2× “Because the letters of credit fall within the scope of Article 5 “an issuer must honor a draft or demand for payment which complies with the terms of the relevant credit, regardless of whether the goods or documents conform to the underlying contract .”
Raiffeisen-Zentralkasse Tirol Reg. Gen. M.B.H. v. First National Bank in Aspen (1983) coloctapp · cites it 2× “This disjunction between a letter of credit and the underlying obligation does not prohibit including in the letter of credit itself non-documentary conditions which are relevant both to satisfaction of the terms of the underlying contract and of the letter of credit.”
Guilford Pattern Works, Inc. v. United Bank of Boulder (1987) cod · cites it 3× “1973 C.R.S. 4-5-114 (Comment, n. 1). Such a reservation is made by issuing a revocable letter of credit.”
Balzano v. United Bank of Denver National Ass'n (1988) coloctapp · cites it 2× “See § 4-5-114, C.R.S. (Official Comment 1); Colorado National Bank v.”
— Colo. Rev. Stat. § 4-5-114(1) — 2 cases
Colorado National Bank of Denver v. Board of County Commissioners (1981) colo “In view of this independent nature of the letter of credit engagement the issuer is under a duty to honor the drafts for payment which in fact conform with the terms of the credit without reference to their compliance with the terms of the underlying contract.”
Guilford Pattern Works, Inc. v. United Bank of Boulder (1987) cod “1973 C.R.S. 4-5-114 (Comment, n. 1). Such a reservation is made by issuing a revocable letter of credit.”
— Colo. Rev. Stat. § 4-5-114(2) — 1 case
Colorado National Bank of Denver v. Board of County Commissioners (1981) colo “In view of this independent nature of the letter of credit engagement the issuer is under a duty to honor the drafts for payment which in fact conform with the terms of the credit without reference to their compliance with the terms of the underlying contract.”
— Colo. Rev. Stat. § 4-5-114(3) — 1 case
Colorado National Bank of Denver v. Board of County Commissioners (1981) colo “In view of this independent nature of the letter of credit engagement the issuer is under a duty to honor the drafts for payment which in fact conform with the terms of the credit without reference to their compliance with the terms of the underlying contract.”
Annotations are extracted automatically from the opinions in the Syfert caselaw corpus and ranked by authority, recency, and treatment. Dots show Syfertize treatment of the citing case itself.