Fiduciary Duties/Obligations

Give examples of non-traditional fiduciary relationships (with relevant cases).

Joint venturer to co-venturer (Chirnside v Fay), and employer to employee (Hivac Ltd v Park Royal Scientific Instruments Ltd)

Steps needed to avoid liability

Contractual arrangement between parties may restrict conduct disclosure to all parties of any existing/possible conflicts of interests sufficient documentation must be specific, fiduciary must explain the details of the transaction disclosure must be given before the transaction takes place

Describe breach of confidence

fiduciaries may owe obligations of confidence and may be required to refrain from any breach of confidence

Describe secret profiteering

fiduciary may not obtain secret profits for him/herself; must account for his/her principal, even if the principal would not have been able to acquire those profits

Describe no competition with the principal

fiduciary must not compete with his/her principal, competition must be in the same line of business

Describe misuse of the principal's property

fiduciary must not misuse the principal's property for his/her own profit

What are the three elements for when there is a BOC?

1. information is confidential (technical/serious - not gossip) 2. told in circumstances that show the info is confidential 3. use of information causes damage/harm

What is a checklist that can be used to determine if there are fiduciary obligations?

1. to whom and why do they owe a fiduciary duty? 2. what specific obligations do they owe as fiduciaries? 3. have they discharged their obligations? 4. what remedies are available if there has been a breach of these obligations?

Describe conflict of interest.

A fiduciary must avoid conflict of interests.

What must the fiduciary do (acting wise)?

Act in the best way to serve another's interests rather than his/her own.

What will breaches in confidence often involve?

Breaches of fiduciary duties and conflicts of interest

What case established the three elements for a BOC?

Coco v Clark

List the fiduciary obligations?

Conflicts of Interest, no competition with the principal, secret profiteering, misuse of the principal's property, breach of confidence

What area of law do fiduciary obligations come from?

Equity

What are non-traditional relations?

Fiduciary relationships that arise outside the established range, but there is a special relationship of trust and confidence.

What is the leading case establishing fiduciary relationships?

Keech v Sandford

What notions are fiduciary relationships based upon?

Loyalty and good faith

What do fiduciary duties involve?

Loyalty, acting in good faith

What case sets out two principles for fiduciaries?

Moss v Moss (no2) (1990)

What can fiduciary duties be easily mistaken for (i.e a careless financial advisor cf. disloyal financial advisor).

Negligent misstatement

What are status-based/traditional relations?

Relations of fiduciary nature arising from trustee/beneficiary type relationships

What are the remedies of Equity?

Remedies are discretionary and include: - Account of profits - injunctions - delivery up of goods

Name the two types of Fiduciary relationships

Status-based (traditional) relations and non-traditional relations

When do fiduciary obligations arise?

When a fiduciary relationship is formed

What is Equity?

a seperate legal system filling the gaps in the harsh common law

What are the two principles set out in Moss v Moss?

a. that no person in a fiduciary position may use that position to obtain a private advantage and, b. that no person in a fiduciary position may enter into an engagement in which his/her personal interests conflicts, or may possibly conflict, with his/her duty.

Chinese Wall

an organisational device within an organisation which is designed to prevent confidential information flowing from one part of the org to another

What are same matter conflicts?

occurs when the same person or members of the same firm act for parties with opposing interests in the same matter

What are fair dealing conflicts?

occurs where the fiduciary has personal interests in the outcome of a transaction he/she is involved in

What are the characteristics of fiduciary relationships?

one party is in a position of trust and confidence. one party has influence over someone in a vulnerable position.

What are the fiduciary obligations?

requirements that a person (fiduciary) must serve someone else's (beneficiary) interests rather than his/her own personal interests