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Can you summarize NJST Chapter 12A:5?
COMMERCIAL TRANSACTIONS >
Short Summary
This section of the New Jersey General and Permanent Statutes, under the Commercial Transactions category, governs the remedies available in various scenarios related to letters of credit. It outlines the remedies for beneficiaries, successors, and nominated persons in case of wrongful dishonor or repudiation by the issuer. The claimant may recover the amount subject to dishonor or repudiation, obtain specific performance, or recover an amount equal to the value of performance. Incidental damages can also be recovered, but not consequential damages. The claimant is not obligated to take action to avoid damages. If damages are avoided, the claimant’s recovery is reduced by the amount avoided. The burden of proving the amount of damages avoided lies with the issuer. The section also covers the remedies available to applicants if an issuer wrongfully dishonors a draft or demand, and the remedies available to a person to whom an obligation is owed if an adviser or nominated person breaches their obligation. Interest on the amount owed is payable from the date of wrongful dishonor or other appropriate date. Reasonable attorney’s fees and other litigation expenses may be awarded to the prevailing party. The section also allows for liquidation of damages by agreement or undertaking, but only in a reasonable amount or formula. No specific penalties are mentioned in this section.
Whom does it apply to?
Beneficiaries, successors, nominated persons, applicants, advisers, and persons to whom an obligation is owed
What does it govern?
Remedies available in various scenarios related to letters of credit
What are exemptions?
No specific exemptions are mentioned in this document
What are the Penalties?
No specific penalties are mentioned in this document
Jurisdiction
New Jersey