People may not know what the definition of fiduciary duty is, but they know it when they see it. The term refers to the expectations between business partners, representatives, or others who act on behalf of the client, employer or partner. A straightforward example would be a financial advisor who is trusted to manage a client’s economic interests or a partner who helps oversee a company’s ongoing financial success. Contracts or agreements usually formalize the responsibilities and obligations.
Common examples of breach of duty
The contract is referred to when one party accuses the other of breach of fiduciary duty. The contract may also outline protocols for resolving a dispute. Another option is to litigate the dispute in civil court. Common examples of a breach include:
- Was there fiduciary duty at the time of the supposed breach?
- They acted on behalf of themselves or a competitor rather than the company.
- They profited at the expense of the employer.
- They failed to perform their duties at the expected standards.
The consequences of the dispute will depend upon the nature of the breach. If there were a loss of business or income, the plaintiff might be able to get compensation for direct or indirect damages. The defendant would also be obliged to pay legal costs if they were found guilty of a breach. Even when the case is a relatively straightforward breach, the parties involved may still have trouble agreeing to the amount of damage caused by the breach. This may be why these cases become so complicated.