Colorado § 4-5-114 Assignment of proceeds

Colorado Statutes

§ 4-5-114 — Assignment of proceeds

Colorado § 4-5-114

Title 04Uniform

Art.Letters of Credit

This text of Colorado § 4-5-114 (Assignment of proceeds) is published on Counsel Stack Legal Research, covering Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Colo. Rev. Stat. § 4-5-114 (2026).

Text

(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

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(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.