Fiduciary Duty
The highest legal duty of care, requiring one party to act in the best interest of another.
Fiduciary duties arise in relationships of trust and confidence, such as between business partners, directors and shareholders, attorneys and clients, or trustees and beneficiaries. The fiduciary must prioritize the other party's interests above their own.
Breach of fiduciary duty can result in significant legal liability, including disgorgement of profits and punitive damages.
Example
A business partner secretly diverts company opportunities to a personal venture, breaching their fiduciary duty to the partnership.
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