§ 4318. Association as trustee.
With respect to a third person dealing with the association in the association's capacity as a trustee pursuant to section 4217 (relating to termination of cooperative ownership) or 4313 (relating to insurance), the existence of trust powers and their proper exercise by the association may be assumed without inquiry. A third person is not bound to inquire whether the association has power to act as trustee or is properly exercising trust powers. A third person, without actual knowledge that the association is exceeding or improperly exercising its powers, is fully protected in dealing with the association as if it possessed and properly exercised the powers it purports to exercise. A third person is not bound to assure the proper application of trust assets paid or delivered to the association in its capacity as trustee.
Section: Previous 4308 4309 4310 4311 4312 4313 4314 4315 4316 4317 4318 4319 4320 4321 NextLast modified: October 8, 2016