Check drawn by and payable to fiduciary
Sec. 6. If a check or other bill of exchange is drawn by a fiduciary
as such or in the name of his principal by a fiduciary empowered to
draw such instrument in the name of his principal, payable to the
fiduciary personally, or payable to a third person and by him
transferred to the fiduciary, and is thereafter transferred by the
fiduciary, whether in payment of a personal debt of the fiduciary or
otherwise, the transferee is not bound to inquire whether the
fiduciary is committing a breach of his obligation as fiduciary in
transferring the instrument, and is not chargeable with notice that the
fiduciary is committing a breach of his obligation as fiduciary unless
he takes the instrument with actual knowledge of such breach or with
knowledge of such facts that his action in taking the instrument
amounts to bad faith.
(Formerly: Acts 1927, c.17, s.6.)
Last modified: May 27, 2006