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An individual in whom another has placed the utmost trust and confidence to manage and protect property or money. The relationship wherein one person has an obligation to act for another's benefit.

A fiduciary relationship encompasses the idea of faith and confidence and is generally established only when the confidence given by one person is actually accepted by the other person. Mere respect for another individual's judgment or general trust in his or her character is ordinarily insufficient for the creation of a fiduciary relationship. The duties of a fiduciary include loyalty and reasonable care of the assets within custody. All of the fiduciary's actions are performed for the advantage of the beneficiary.

Courts have neither defined the particular circumstances of fiduciary relationships nor set any limitations on circumstances from which such an alliance may arise. Certain relationships are, however, universally regarded as fiduciary. The term embraces legal relationships such as those between attorney and client, Broker and principal, principal and agent, trustee and beneficiary, and executors or administrators and the heirs of a decedent's estate.

A fiduciary relationship extends to every possible case in which one side places confidence in the other and such confidence is accepted; this causes dependence by the one individual and influence by the other. Blood relation alone does not automatically bring about a fiduciary relationship. A fiduciary relationship does not necessarily arise between parents and children or brothers and sisters.

The courts stringently examine transactions between people involved in fiduciary relationships toward one another. Particular scrutiny is placed upon any transaction by which a dominant individual obtains any advantage or profit at the expense of the party under his or her influence. Such transaction, in which Undue Influence of the fiduciary can be established, is void.


1) n. from the Latin fiducia, meaning "trust," a person (or a business like a bank or stock brokerage) who has the power and obligation to act for another (often called the beneficiary) under circumstances which require total trust, good faith and honesty. The most common is a trustee of a trust, but fiduciaries can include business advisers, attorneys, guardians, administrators of estates, real estate agents, bankers, stock brokers, title companies, or anyone who undertakes to assist someone who places complete confidence and trust in that person or company. Characteristically, the fiduciary has greater knowledge and expertise about the matters being handled. A fiduciary is held to a standard of conduct and trust above that of a stranger or of a casual business person. He/she/it must avoid "self-dealing" or "conflicts of interests" in which the potential benefit to the fiduciary is in conflict with what is best for the person who trusts him/her/it. For example, a stockbroker must consider the best investment for the client, and not buy or sell on the basis of what brings him/her the highest commission. While a fiduciary and the beneficiary may join together in a business venture or a purchase of property, the best interest of the beneficiary must be primary, and absolute candor is required of the fiduciary. 2) adj. defining a situation or relationship in which a person is acting as a fiduciary for another. (See: trust, fiduciary relationship)


adjective commanding belief, commanddng confidence, confidential, deserving belief, fiducial, founded in confidence, reliable, sound, trusted, worthy of belief, worthy of credence
Associated concepts: fiduciary bequest, fiduciary bond, fiduuiary capacity, fiduciary relation


noun agent, caretaker, custodian, guardian, one who handles property for another, one who transacts business for another, person entrusted with property of another, trustee
Associated concepts: escrow, trust
See also: executor, pecuniary, trustee
References in periodicals archive ?
Accordingly, employers need to have a clear understanding of an advisor's business model and level of fiduciary responsibility to make an informed decision.
Advisors who don't assume fiduciary responsibility or team with those companies do, thereby leaving the plan sponsor with full responsibility
In that instance, how does the company respect the fiduciary responsibility to truly minority shareholders?
It is intended to benefit workers by (1) encouraging the voluntary and timely correction of possible fiduciary breaches, (2) encouraging the full correction of certain breaches of fiduciary responsibility and (3) restoring to participants and beneficiaries losses resulting from fiduciary breaches.
Although the judge dismissed those charges for lack of evidence, the judge did rule that KPMG had breached its fiduciary responsibility to its client.
CIEBA members represent 150 corporate pension plan sponsors that collectively have fiduciary responsibility for more than $900 billion in pension plan assets.
The chairman of the board is responsible for running the board of directors, which has a fiduciary responsibility for selecting new directors, setting executive compensation, evaluating executive performance and, through the audit committee, evaluating the company's financial reporting and disclosures, in addition to general corporate oversight.
It's the right thing to do when you have a fiduciary responsibility,'' said Burbank Schools Superintendent Gregory Bowman.
Yet the fiduciary responsibility is the primary consideration.
If accepting an in-kind contribution is not "prudent," not "solely in the interest" of the plan's participants and beneficiaries, or would result in an improper lack of diversification of plan assets, the responsible fiduciaries would be liable for any losses resulting from such a breach of fiduciary responsibility, even if such a contribution does not constitute a prohibited transaction.