KRS 381.9199: Association as trustee.

With respect to a third person dealing with the association in the association's capacity as

a trustee:

(1) The existence of trust powers and their proper exercise by the association may be

assumed without inquiry;

(2) A third person is not bound to inquir e whether the association has power to act as

trustee or is properly exercising trust powers;

(3) A third person, without actual knowledge that the association is exceeding or

improperly exercising its powers, is fully protected in dealing with the associa tion

as if it possessed and properly exercised the powers it purports to exercise; and

(4) A third person is not bound to ensure the proper application of trust assets paid or

delivered to the association in its capacity as trustee.