fiduciary

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Related to Fiduciary duties: Fiduciary relationship

Fiduciary

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.

fiduciary

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)

fiduciary

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

fiduciary

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 ?
The Delaware Limited Liability Act allows members pursuant to the operating agreement to eliminate all fiduciary duties that may otherwise be owed.
There are differences in who can enforce a breach of fiduciary duties when the corporation is solvent as opposed to insolvent.
However, despite the diversity of factual scenarios in which fiduciary duties arise, these relationships share a set of legal principles common to all fiduciary relationships.
The question might have been answered, at least in California, in 2011, in a Court of Appeal opinion that flat refused to extend fiduciary duties to insurance brokers.
California's law is illustrative: "A mortgage broker providing mortgage brokerage services to a borrower is the fiduciary of the borrower, and any violation of the broker's fiduciary duties shall be a violation of the mortgage broker's license law.
The regrettable absence of doctrinal precision with respect to the Court's discussion of fiduciary duties is evident early in the decision, when the Court defines the duty of directors to act in the best interests of the corporation as required by paragraph 122(1)(a) of the CBCA (6) as their "fiduciary duty.
Courts impose fiduciary duties on shareholders of closely held corporations.
A number of insurance agents have already taken a route to avoid the problems with respect to fiduciary duties.
Whether the Zelman brothers actually misused the loan proceeds may be relevant in other legal proceedings, but it is not relevant to the issue of whether Herman breached his fiduciary duties to [plaintiff].
In response to these abuses, courts are formulating a mandatory core of fiduciary duties as they mediate disputes among LLC business associates.
Numerous and voluminous news reports have revealed egregious failures by top executives and their advisers -- including accountants, investment bankers, and lawyers to fulfill their bastic fiduciary duties to serve the interests of shareholders and the public.