A fiduciary duty can arise in various ways. It can arise automatically from specific relationships,
like a trustee of a trust, who has a fiduciary duty to the trust beneficiaries. Likewise, a general
partner in a partnership typically owes a fiduciary duty to his partners, and an agent representing you in a business deal may have a fiduciary duty to you. An insurance broker may have a fiduciary duty to his client. In addition, a fiduciary relationship can arise by the existence of a special relationship where you place trust in another so that they gain superiority and influence over you.It's important to note that a fiduciary relationship can be established without a formal contract or a defined relationship like attorney-client. For instance, a person who takes charge or control of a disabled person’s funds may be found to be a fiduciary, even if no contract exists between the parties. This is known as a de facto fiduciary. Determining whether an individual’s conduct rises to the level of a de facto fiduciary is a fact-intensive analysis developed both before a lawsuit is filed and during the discovery phase.
Next, once a fiduciary relationship is established, most state laws require a fiduciary to prove
that any transaction he or she entered into with the beneficiary was fair and reasonable. In
Illinois, this means that the fiduciary's proof must be clear and convincing, setting a high
standard for fiduciaries and emphasizing the need for transparency in fiduciary relationships.
Last, the plaintiff must prove the damages that proximately flowed from the breach.This area of the law involves legal principles different from arm’s length business transactions.
So, when prosecuting or defending claims involving a breach of fiduciary duty, it's crucial to hire
lawyers with experience in this specialized area of the law. Their expertise can make a significant
difference in the outcome of your case.The lawyers at King & Jones have been prosecuting and defending breach of fiduciary duty
claims for decades. Our lawyers have been involved in several reported appellate cases involving
these issues. If you have such a problem, contact us to discuss your concerns.
What is a breach of fiduciary duty?