When someone accepts legal or ethical responsibility for another party by the means of a promised service, they can become a fiduciary for said party. A fiduciary is “a person or a business like an attorney, trustee, bank or stock brokerage who has the power and obligation to act for another under circumstances which require total trust, good faith and honesty,” (Law.com). A fiduciary must act in YOUR best interest at all times. When a fiduciary fails to deliver, or abuses the trust of their beneficiary, a breach of fiduciary is constituted.
Examples of fiduciary relationships
Examples of fiduciary breaches
Recognizing a breach of fiduciary duty lies in the hands of you, the beneficiary. Similar to a breach of contract, it is crucial that you fully comprehend the scope of services to be provided by the prospective fiduciary before enlisting their services or entering into an agreement. Common breaches of fiduciary include negligence, such as a guardian ignoring their responsibility in ensuring the ward receives education; tardiness on deliverables; and failure to disclose information necessary for the principal of a business to make an informed decision.
How to recover
As with any legal issue, if you believe a fiduciary has committed a breach, the best option is to contact a lawyer. A lawyer with experience in business can easily protect your rights and help you obtain the promised services, as well as advise you regarding the best way to move forward.
Fiduciaries are entrusted to maintain the highest level of ethical standards and to deliver on every service requested by a beneficiary. Fiduciary duty exists in almost all business relationships, making it extremely important that both fiduciaries and beneficiaries understand the ins and outs of the promised services. A breach of fiduciary duty can be devastating. Luckily, a good lawyer can clean up the mess.