PARRIS N. GLENDENING, Governor

Ch. 652

SECTION. THE TERMS IN THE NOTICE TO THE TRANSFEREE BENEFICIARY MAY
DIFFER FROM THE TERMS IN ANY NOTICE TO THE TRANSFEROR BENEFICIARY TO
THE EXTENT PERMITTED BY THE LETTER OF CREDIT, CONFIRMATION,
AMENDMENT, OR ADVICE RECEIVED BY THE PERSON WHO SO NOTIFIES.

5-108. ISSUER'S RIGHTS AND OBLIGATIONS.

(A)    EXCEPT AS OTHERWISE PROVIDED IN § 5-109 OF THIS TITLE, AN ISSUER
SHALL HONOR A PRESENTATION THAT, AS DETERMINED BY THE STANDARD
PRACTICE REFERRED TO IN SUBSECTION (E) OF THIS SECTION, APPEARS ON ITS
FACE STRICTLY TO COMPLY WITH THE TERMS AND CONDITIONS OF THE LETTER OF
CREDIT. EXCEPT AS OTHERWISE PROVIDED IN § 5-113 OF THIS TITLE AND UNLESS
OTHERWISE AGREED WITH THE APPLICANT, AN ISSUER SHALL DISHONOR A
PRESENTATION THAT DOES NOT APPEAR SO TO COMPLY.

(B)     AN ISSUER HAS A REASONABLE TIME AFTER PRESENTATION, BUT NOT
BEYOND THE END OF THE 7TH BUSINESS DAY OF THE ISSUER AFTER THE DAY OF ITS
RECEIPT OF DOCUMENTS:

(1)     TO HONOR;

(2)     IF THE LETTER OF CREDIT PROVIDES FOR HONOR TO BE
COMPLETED MORE THAN 7 BUSINESS DAYS AFTER PRESENTATION, TO ACCEPT A
DRAFT OR INCUR A DEFERRED OBLIGATION; OR

(3)     TO GIVE NOTICE TO THE PRESENTER OF DISCREPANCIES IN THE
PRESENTATION.

(C)     EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION (D) OF THIS SECTION,
AN ISSUER IS PRECLUDED FROM ASSERTING AS A BASIS FOR DISHONOR ANY
DISCREPANCY IF TIMELY NOTICE IS NOT GIVEN, OR ANY DISCREPANCY NOT STATED
IN THE NOTICE IF TIMELY NOTICE IS GIVEN.

(D)    FAILURE TO GIVE THE NOTICE SPECIFIED IN SUBSECTION (B) OF THIS
SECTION OR TO MENTION FRAUD, FORGERY, OR EXPIRATION IN THE NOTICE DOES
NOT PRECLUDE THE ISSUER FROM ASSERTING AS A BASIS FOR DISHONOR FRAUD
OR FORGERY AS DESCRIBED IN § 5-109(A) OF THIS TITLE OR EXPIRATION OF THE
LETTER OF CREDIT BEFORE PRESENTATION.

(E)     AN ISSUER SHALL OBSERVE STANDARD PRACTICE OF FINANCIAL
INSTITUTIONS THAT REGULARLY ISSUE LETTERS OF CREDIT. DETERMINATION OF
THE ISSUER'S OBSERVANCE OF THE STANDARD PRACTICE IS A MATTER OF
INTERPRETATION FOR THE COURT. THE COURT SHALL OFFER THE PARTIES A
REASONABLE OPPORTUNITY TO PRESENT EVIDENCE OF THE STANDARD PRACTICE.

(F)     AN ISSUER IS NOT RESPONSIBLE FOR:

(1)     THE PERFORMANCE OR NONPERFORMANCE OF THE UNDERLYING
CONTRACT, ARRANGEMENT, OR TRANSACTION;

(2)     AN ACT OR OMISSION OF OTHERS; OR

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