Fiduciary duties of directors


Published by a ³ÉÈËÓ°Òô Corporate expert
Practice notes

Fiduciary duties of directors


Published by a ³ÉÈËÓ°Òô Corporate expert

Practice notes
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This Practice Note summarises the traditional fiduciary duties of company directors, including the duty to act in the best interests of the company, the no conflict and no profit principles, and the equitable duty of confidence. It also considers the remedies for breach of the duties, and also the various ways in which a director may be relieved of the consequences of a breach, namely ratification, indemnity and insurance.

What is a fiduciary relationship?

A fiduciary duty indicates a relationship of trust, assurance or confidence between two or more parties.

While there is no inherent limit to the types of relationship that would be construed as fiduciary under the common law, some relationships are automatically fiduciary, eg those between trustee and beneficiary, solicitor and client, principal and agent, business partner and co-partners, mortgagor and mortgagee.

Other relationships will be characterised as fiduciary if one person has agreed to act for or on behalf of another in circumstances where a relationship of trust and confidence is deemed to have arisen (eg between a family member and an elderly relative, or

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Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
Fiduciary definition
What does Fiduciary mean?

A person, or entity, who acts for the benefit and on behalf of another person or group of persons. A fiduciary holds a legally enforceable position of trust.

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