14-7506

14-7506. Deposit in name of fiduciary as
such

If a deposit is made in a bank to the credit of a fiduciary as such, the bank is
authorized to pay the amount of the deposit or any part thereof upon the check of the
fiduciary, signed with the name in which such deposit is entered, without being liable to
the principal, unless the bank pays the check with actual knowledge that the fiduciary is
committing a breach of his obligation as fiduciary in drawing the check or with knowledge
of such facts that its action in paying the check amounts to bad faith. If, however,
such a check is payable to the drawee bank and is delivered to it in payment of or as
security for a personal debt of the fiduciary to it, the bank is liable to the principal
if the fiduciary in fact commits a breach of his obligation as fiduciary in drawing or
delivering the check.