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 the 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 the breach or with knowledge of facts that his action in taking the instrument amounts to bad faith.
N.J. Stat. Ann. § 3B:14-55
Check drawn by and payable to fiduciary
Applied in 1 court decision — leading case 385 Wis. 2d 261 - Koss Corporation v. Park Bank (2019)
Most recently applied in 385 Wis. 2d 261 - Koss Corporation v. Park Bank (January 2019)
L.1981, c. 405, s. 3B:14-55, eff
Current official text: New Jersey Legislature. Digitized from the New Jersey Legislature bulk statutes download. Reproduced from public-domain New Jersey statutes; confirm against the official source for the current text. Not legal advice.