California Commercial Code

§ 5118

COM § 5118 Effective Jan 1, 2000Div. 5

Statute text

(a)An issuer or nominated person has a security interest in a document presented under a letter of credit to the extent that the issuer or nominated person honors or gives value for the presentation.

(b)So long as and to the extent that an issuer or nominated person has not been reimbursed or has not otherwise recovered the value given with respect to a security interest in a document under subdivision (a), the security interest continues and is subject to Division 9 (commencing with Section 9101), subject to all of the following:

(1)A security agreement is not necessary to make the security interest enforceable under paragraph (3) of subdivision (b) of section 9203.

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Legislative history

Added by Stats. 1999, Ch. 991, Sec. 29.5. Effective January 1, 2000. Operative July 1, 2001, by Sec. 75 of Ch. 991.