Sec. 5. (a) This section does not apply in cases of bad faith or actual knowledge to the contrary by a party.
(b) A party that enters into any swap agreement with a state educational institution may rely on a representation by that state educational institution that the state educational institution is authorized or empowered to enter into the swap agreement, and notwithstanding the failure by the state educational institution to comply with the provisions of this chapter, that party may enforce the swap agreement against the state educational institution, subject to the terms of the swap agreement and subject to prior claims on sources from which the swap agreement may be payable.