§ 41-05-11 — (5-111) Remedies

North Dakota § 41-05-11

• Jurisdiction: North Dakota
• Title 41: Uniform Commercial Code
• Ch. 41-05: Letters of Credit

Text

1. If an issuer wrongfully dishonors or repudiates its obligation to pay money under a
letter of credit before presentation, the beneficiary, successor, or nominated person
presenting on its own behalf may recover from the issuer the amount that is the
subject of the dishonor or repudiation. If the issuer's obligation under the letter of credit
is not for the payment of money, the claimant may obtain specific performance or, at
the claimant's election, recover an amount equal to the value of performance from the
issuer. In either case, the claimant may also recover incidental but not consequential
damages. The claimant is not obligated to take action to avoid damages that might be
due from the issuer under this subsection. If, although not obligated to do so, the
claimant avoids damages, the claimant's recovery from the issuer must be reduced by
the amount of damages avoided. The issuer has the burden of proving the amount of
damages avoided. In the case of repudiation the claimant need not present any
document.
2. If an issuer wrongfully dishonors a draft or demand presented under a letter of credit or
honors a draft or demand in breach of its obligation to the applicant, the applicant may
recover damages resulting from the breach, including incidental but not consequential
damages, less any amount saved as a result of the breach.
3. If an adviser or nominated person other than a confirmer breaches an obligation under
this chapter or an issuer breaches an obligation not covered in subsection 1 or 2, a
person to whom the obligation is owed may recover damages resulting from the
breach, including incidental but not consequential damages, less any amount saved as
a result of the breach. To the extent of the confirmation, a confirmer has the liability of
an issuer specified in this subsection and subsections 1 and 2.
4. An issuer, nominated person, or adviser who is found liable under subsection 1, 2, or 3
shall pay interest on the amount owed thereunder from the date of wrongful dishonor
or other appropriate date.
5. Reasonable attorney's fees and other expenses of litigation must be awarded to the
prevailing party in an action in which a remedy is sought under this chapter.
6. Damages that would otherwise be payable by a party for breach of an obligation under
this chapter may be liquidated by agreement or undertaking, but only in an amount or
by a formula that is reasonable in light of the harm anticipated.