14-7505

14-7505. Check drawn by and payable to
fiduciary

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.