(a) Except as otherwise provided in Section 7-5-113, unless a letter of credit provides that it is transferable, the right of a beneficiary to draw or otherwise demand performance under a letter of credit may not be transferred.
(b) Even if a letter of credit provides that it is transferable, the issuer may refuse to recognize or carry out a transfer if:
(1) the transfer would violate applicable law; or
(2) the transferor or transferee has failed to comply with any requirement stated in the letter of credit or any other requirement relating to transfer imposed by the issuer which is within the standard practice referred to in Section 7-5-108(e) or is otherwise reasonable under the circumstances.
Structure Code of Alabama
Article 5 - Letters of Credit.
Section 7-5-101 - Short Title.
Section 7-5-102 - Definitions.
Section 7-5-104 - Formal Requirements.
Section 7-5-105 - Consideration.
Section 7-5-106 - Issuance, Amendment, Cancellation, and Duration.
Section 7-5-107 - Confirmer, Nominated Person, and Adviser.
Section 7-5-108 - Issuer's Rights and Obligations.
Section 7-5-109 - Fraud and Forgery.
Section 7-5-112 - Transfer of Letter of Credit.
Section 7-5-113 - Transfer by Operation of Law.
Section 7-5-114 - Assignment of Proceeds.
Section 7-5-115 - Statute of Limitations.
Section 7-5-116 - Choice of Law and Forum.
Section 7-5-117 - Subrogation of Issuer, Applicant, and Nominated Person.
Section 7-5-118 - Security Interest of Issuer or Nominated Person.