When a deposit is made in a bank in the name of two or more persons as trustees and a check is drawn upon the trust account by a trustee authorized by another trustee to draw checks upon the trust account:

1. (1) the payee or bank is not bound to inquire whether the deposit is a breach of trust to authorize a trustee to draw checks upon the trust account; and
2. (2) the payee or bank is not liable unless the circumstances are such that the action of the payee or bank amounts to bad faith.

Renumbered and Amended by Chapter 364, 2024 General Session