{"data":{"id":"us-ky/krs-355.3-307","jurisdiction":"us-ky","citation":"KRS 355.3-307","heading":"Notice of breach of fiduciary duty.","body":"(1) In this section:\n(a) \"Fiduciary\" means an agent, trustee, partner, corporate officer or director, or\nother representative owing a fiduciary duty with respect to an instrument.\n(b) \"Represented person\" means the principal, beneficiary, partnership,\ncorporation, or other person to whom the duty stated in paragraph (a) of this\nsubsection is owed.\n(2) (a) If:\n1. An instrument is taken from a fiduciary for payment or collection or for\nvalue;\n2. The taker has knowledge of the fiduciary status of the fiduciary; and\n3. The represented person makes a claim to the instrument or its proceeds\non the basis that the transaction of the fiduciary is a breach of fiduciary\nduty,\nthe rules set out in paragraph (b) of this subsection apply:\n(b) 1. Notice of breach of fiduciary duty by the fiduciar y is notice of the claim\nof the represented person.\n2. In the case of an instrument payable to the represented person or the\nfiduciary as such, the taker has notice of the breach of fiduciary duty if\nthe instrument is:\na. Taken in payment of or as security for a debt known by the taker to\nbe the personal debt of the fiduciary;\nb. Taken in a transaction known by the taker to be for the personal\nbenefit of the fiduciary; or\nc. Deposited to an account other than an account of the fiduciary, as\nsuch, or an account of the represented person.\n3. If an instrument is issued by the represented person or the fiduciary as\nsuch, and made payable to the fiduciary personally, the taker does not\nhave notice of the breach of fiduciary duty unless the taker knows of the\nbreach of fiduciary duty.\n4. If an instrument is issued by the represented person or the fiduciary as\nsuch, to the taker as payee, the taker has notice of the breach of fiduciary\nduty if the instrument is:\na. Taken in payment of or as security for a debt known by the taker to\nbe the personal debt of the fiduciary;\nb. Taken in a transaction known by the taker to be for the personal\nbenefit of the fiduciary; or\nc. Deposited to an account other than an account of the fiduciary, as\nsuch, or an account of the represented person.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=33465","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:58:44Z","sha256":"9a9070b68b2ec317195d751024d35e8d61c9fbed696b704dd70ada2bf8119103","source_id":"us-ky","stale":false,"prev":"us-ky/krs-355.3-306","next":"us-ky/krs-355.3-308"},"notice":"GroundRules: Original legal text. Not legal advice."}