§ 18-4-19 Check drawn by and payable to
fiduciary. –
If a check or other bill of exchange is drawn by a fiduciary or in the name of
his or her principal by a fiduciary empowered to draw the instrument in the
name of his or her principal, payable to the fiduciary personally, or payable
to a third person and by him or her 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 or her obligation as fiduciary in
transferring the instrument, and is not chargeable with notice that the
fiduciary is committing a breach of his or her obligation as fiduciary, unless
he or she takes the instrument with actual knowledge of the breach, or with
knowledge of any facts that his or her action in taking the instrument amounts
to bad faith.
(P.L. 1960, ch. 147, § 3.)