{"data":{"id":"us-ky/krs-397.1007","jurisdiction":"us-ky","citation":"KRS 397.1007","heading":"Protection of payors, bona fide purchases, and other third parties --","body":"Personal liability of recipient.\n(1) (a) A payor or other third party shall not be liable for having made a payment or\ntransferred an item of property or any other benefit to a beneficiary designated\nin a governing instrument who, under this chapter, is not entitled to the\npayment or item of property, or for having taken any other action in good faith\nreliance on the beneficiary's apparent entitlement under the terms of the\ngoverning instrument, before the payor or other third party received written\nnotice of a claimed lack of entitlement under this chapter. A payor or other\nthird party shall be liable for a payment made or other action taken after the\npayor or other third party rece ived written notice of a claimed lack of\nentitlement under this chapter.\n(b) Written notice of a claimed lack of entitlement under paragraph (a) of this\nsubsection shall be mailed to the payor's or other third party's main office or\nhome by registered or c ertified mail, return receipt requested, or served upon\nthe payor or other third party in the same manner as a summons in a civil\naction. Upon receipt of written notice of a claimed lack of entitlement under\nthis chapter, a payor or other third party shall  pay any amount owed, or\ntransfer or deposit any item of property held by it, to or with the court having\njurisdiction of the probate proceedings related to the decedent's estate, or if no\nproceedings have been commenced, to or with the court having jurisd iction of\nprobate proceedings relating to the decedent's estate located in the county of\nthe decedent's residence. The court shall hold the funds or item of property\nand, upon its determination under this chapter, shall order disbursement in\naccordance with the determination. Payments, transfers, or deposits made to or\nwith the court shall discharge the payor or other third party from all claims for\nthe value of amounts paid to or items of property transferred to or deposited\nwith the court.\n(2) A person wh o purchases property for value and without notice, or who receives a\npayment or other item of property in partial or full satisfaction of a legally\nenforceable obligation, shall not be obligated under this chapter to return the\npayment, item of property, o r benefit and shall not be liable under this chapter for\nthe amount of the payment or the value of the item of property or benefit. But a\nperson who, not for value, receives a payment, item of property, or any other benefit\nto which the person is not entit led under this chapter shall be obligated to return the\npayment, item of property, or benefit or shall be personally liable for the amount of\nthe payment of the value of the item of property or benefit, to the person who is\nentitled to it under this chapter.\n(3) If this chapter, or any part of this chapter, is preempted by federal law with respect\nto a payment, an item of property, or any other benefit covered by this chapter, a\nperson who, not for value, receives the payment, item of property, or any other\nbenefit to which the person is not entitled under this chapter shall be obligated to\nreturn the payment, item of property, or benefit or shall be personally liable for the\namount of the payment or the value of the item of property or benefit, to the perso n\nwho would have been entitled to it were this chapter, or part of this chapter, not\npreempted.","path":["KRS Chapter 397"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=36457","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:59:28Z","sha256":"549c538e0acd9869f83d628fabb1da5da9e388f33d81844abe2a60c4984b4221","source_id":"us-ky","stale":false,"prev":"us-ky/krs-397.1006","next":"us-ky/krs-397.1008"},"notice":"GroundRules: Original legal text. Not legal advice."}