fiduciary


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fiduciary

(fĭdo͞o`shēĕ'rē), in law, a person who is obliged to discharge faithfully a responsibility of trust toward another. Among the common fiduciary relationships are guardian to ward, parent to child, lawyer to client, corporate director to corporation, trustee to trusttrust,
in law, arrangement whereby property legally owned by one person is administered for the benefit of another. Three parties are ordinarily needed for the relation to arise: the settlor, who bequeaths or deeds the property for another's benefit; the trustee, in whose hands
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, and business partner to business partner. In discharging a trust, the fiduciary must be absolutely open and fair. Certain business methods that would be acceptable between independent parties dealing with one another "at arm's length" may expose a fiduciary to liability for having abused a position of trust. Thus, in an ordinary business transaction the prospective purchaser of land need not inform the seller of an imminent rise in realty values, but one buying land from a partner must disclose such information. In many cases courts will treat an unexplained profit derived from a fiduciary relationship as an instance of constructive fraudfraud,
in law, willful misrepresentation intended to deprive another of some right. The offense, generally only a tort, may also constitute the crime of false pretenses. Frauds are either actual or constructive.
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fiduciary

Law
1. a person bound to act for another's benefit, as a trustee in relation to his beneficiary
2. 
a. having the nature of a trust
b. of or relating to a trust or trustee
References in periodicals archive ?
Thomas A Smith, "The Efficient Norm for Corporate Law: A Neotraditional Interpretation of Fiduciary Duty" (1999) 98:1 Mich L Rev 214.
Donovan WM Waters, "The Development of Fiduciary Obligations" in Rebecca Johnson et al, eds, Gerard V.
Ernest J Weinrib, "The Fiduciary Obligation" (1975) 25:1 UTLJ 1.
* presenting the financial statements of fiduciary funds appropriately.
It first provides an abbreviated walk-through of fiduciary activity reporting guidance, then discusses how to determine whether a component unit or other activity of a government is a fiduciary activity that should be reported in a fiduciary fund.
The Evolution of Fiduciary Activity Reporting Guidance
The Maryland District Court relied upon a 1976 Department of Labor (DOL) advisory opinion, which it held was “entitled to respect” under Supreme Court guidance because of its “power to persuade.” The DOL explained that Section 409(b) “did not exempt an ERISA fiduciary from carrying out its responsibilities under Title I of ERISA.” For example, although a fiduciary may not be liable under Section 409 for the acts of predecessor fiduciaries, if he knows of a breach of responsibility that one of them committed, he would be obligated to take whatever action is responsible and appropriate under the circumstances to remedy it.
This analysis is also consistent with ERISA Section 405(a)(3), which imposes co-fiduciary liability if a fiduciary has “knowledge of a breach by such other fiduciary, unless he makes reasonable efforts under the circumstances to remedy such breach.” However--at least according to some courts--to avoid undermining Section 409(b), for there to be co-fiduciary liability for a successor trustee, he would need to have actual knowledge: 1) that the other person was a fiduciary with respect to the plan; 2) that the other person participated in the acts that constituted the breach; and 3) that the act in question was a breach.
In the US, for example, it is normal to describe the duty of care and skill that is presumptively owed by every fiduciary as a fiduciary duty.
Arguments about which duties are properly called fiduciary are, in one sense, arguments about terminology.
As to part of the guidance that addresses notifying plan sponsors of fiduciary status, "the issue is a little more complicated," Reish said.
"There probably isn't much potential damage to plans if they don't know -- for a limited time period -- that their advisor is a fiduciary. And there certainly is a temporary saving of effort and money in delaying the notice.