Ness, Motley, Loadholt, Richardson & Poole The courts in the United States have heard, over the years, many matters involving breach of fiduciary duty.

Generally, the law requires the fiduciary to restore or repay any losses resulting from a breach of fiduciary duty, and the court may order other remedies, such as additional financial sanctions, and the award of attorney’s fees. Breach of Fiduciary DutyĪny person or entity with a fiduciary duty who fails to uphold, or fails to act responsibly in fulfilling, his duties, obligations, and responsibilities as fiduciary, has breached his fiduciary duty. Anyone acting as a fiduciary who has held themselves out to have greater skills than ordinary people, such as an accountant, attorney, or other professional, is held to a higher standard of care, as he is expected to use his expertise in acting on behalf of the trust. It is not permitted for a trust fiduciary to profit in his dealings with the trust at the expense of the beneficiaries, and is not permitted to purchase or otherwise acquire any of the trust’s assets for himself.Įvery trust fiduciary must take the same care in managing the assets of the trust as he would his own assets. When assets belonging to a person or entity are put into a trust, the “Trustee,” or administrator of the trust, becomes a fiduciary for the benefit of the trust’s creator, the “trustor.” The trust fiduciary has a solemn responsibility of loyalty in managing the assets of the trust in the best interest of the named beneficiaries. Fiduciary duty may be referred to as “fiduciary responsibility.” Fiduciary Responsibility in Administering a Trust legal system, the fiduciary duty is considered the most stringent duty of care. In such a case, a fiduciary is expected to use his expertise and good judgment in acting on the client’s behalf. For example, an attorney has a fiduciary duty to his client, and the board members of a corporation have a fiduciary duty to the company’s shareholders. This comes into play when the relationship between the two parties involves a particular trust or confidence in, and reliance upon one party by another. 1585-95 Latin fīdūciārius, of something held in trust What is Fiduciary DutyĪ fiduciary duty exists when a person or entity has an obligation to act in another person or entity’s best interest.

Fiduciary relationship examples