District of Columbia § 21-1707 Deposit in name of principal; check drawn thereon by fiduciary; check payable to drawee bank.

District of Columbia Statutes

§ 21-1707 — Deposit in name of principal; check drawn thereon by fiduciary; check payable to drawee bank.

District of Columbia·Title 21 Fiduciary Relations and Persons with Mental Illness. [Enacted title]·Ch. 17 General Fiduciary Relations.·Subch. I Uniform Fiduciaries Act.

If a check is drawn upon a bank account of his principal by a fiduciary who is empowered to draw checks upon his principal’s account, the bank is authorized to pay the checks 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 facts that its action in paying the check amounts to bad faith. If, however, the 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.

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If a check is drawn upon a bank account of his principal by a fiduciary who is empowered to draw checks upon his principal’s account, the bank is authorized to pay the checks 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 facts that its action in paying the check amounts to bad faith. If, however, the 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.

District of Columbia § 21-1707 (Deposit in name of principal; check drawn thereon by fiduciary; check payable to drawee bank.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.