§ 30-2-4-6 — Check drawn by and payable to fiduciary

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 such 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 such breach or with knowledge of
such facts that his action in taking the instrument amounts to bad faith.
Formerly: Acts 1927, c.17, s.6.