Iowa Code

Iowa Code § 554.3307 (2026)

Notice of breach of fiduciary duty

✓ current as of July 2026

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1. In this section:

a. “Fiduciary” means an agent, trustee, partner, corporate officer or director, or other representative owing a fiduciary duty with respect to an instrument.

b. “Represented person” means the principal, beneficiary, partnership, corporation, or other person to whom the duty stated in paragraph “a” is owed.

2. If an instrument is taken from a fiduciary for payment or collection or for value, the taker has knowledge of the fiduciary status of the fiduciary, and the represented person makes a claim to the instrument or its proceeds on the basis that the transaction of the fiduciary is a breach of fiduciary duty, the following rules apply:

a. Notice of breach of fiduciary duty by the fiduciary is notice of the claim of the represented person.

b. In the case of an instrument payable to the represented person or the fiduciary as such, the taker has notice of the breach of fiduciary duty if the instrument is taken in payment of or as security for a debt known by the taker to be the personal debt of the fiduciary, taken in a transaction known by the taker to be for the personal benefit of the fiduciary, or deposited to an account other than an account of the fiduciary, as such, or an account of the represented person.

c. If an instrument is issued by the represented person or the fiduciary as such, and made payable to the fiduciary personally, the taker does not have notice of the breach of fiduciary duty unless the taker knows of the breach of fiduciary duty.

d. If an instrument is issued by the represented person or the fiduciary as such, to the taker as payee, the taker has notice of the breach of fiduciary duty if the instrument is taken in payment of or as security for a debt known by the taker to be the personal debt of the fiduciary, taken in a transaction known by the taker to be for the personal benefit of the fiduciary, or deposited to an account other than an account of the fiduciary, as such, or an account of the represented person. 94 Acts, ch 1167, §42, 121, 122; 2013 Acts, ch 30, §261 Referred to in §554.3104, 554.3206 \n

Notes of Decisions

Cited in 4 cases, 1970–1981 · leading case: Cont'l Illinois Nat'l Bank & Trust Co. of Chicago v. Sec. State Bank, 182 N.W.2d 116 (Iowa 1970).

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Cont'l Illinois Nat'l Bank & Trust Co. of Chicago v. Sec. State Bank, 182 N.W.2d 116 (Iowa 1970). · cites it 8× “See The Code 1966, Section 554.3307(2), (3). But such alone is not determinative.”

Atl. Veneer Corp. v. Sears, 232 N.W.2d 499 (Iowa 1975). · cites it 2× “In this regard trial court, relying on § 3-307 of the Uniform Commercial Code (The Code 1971, Section 554.3307) apparently placed upon defendant the burden to show a final settlement of then existing accounts had been not effected by his giving of the November 1970 promissory…”

Manson State Bank v. Tripp, 248 N.W.2d 105 (Iowa 1976). · cites it 2× “Section 554.3307(2), The Code. In alleging fraud in a law action these defendants shouldered an onerous burden.”

Mishler v. Stouwie, 301 N.W.2d 744 (Iowa 1981). “The district judge who entered the default judgment was confronted with a petition demanding judgment for the balance due on the promissory note, a record reflecting service of process upon these two defendants and the lack of any appearance, motion or answer in their behalf.”

— Iowa Code § 554.3307(2) — 2 cases

Cont'l Illinois Nat'l Bank & Trust Co. of Chicago v. Sec. State Bank, 182 N.W.2d 116 (Iowa 1970). “See The Code 1966, Section 554.3307(2), (3). But such alone is not determinative.”

Manson State Bank v. Tripp, 248 N.W.2d 105 (Iowa 1976). “Section 554.3307(2), The Code. In alleging fraud in a law action these defendants shouldered an onerous burden.”

— Iowa Code § 554.3307(3) — 1 case

Cont'l Illinois Nat'l Bank & Trust Co. of Chicago v. Sec. State Bank, 182 N.W.2d 116 (Iowa 1970). “See The Code 1966, Section 554.3307(2), (3). But such alone is not determinative.”

— Iowa Code § 554.3307(l)(b) — 1 case

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