fiduciary duty

In commercial life, fiduciary duties apply in a wide variety of situations. For instance, where an employee or director of a company (1) takes advantage of business opportunities made known to them during the course of their relationship and diverted such opportunities to themselves, (1) receives bribes from suppliers, and/or (3) engages in unlawful competitive activity, the employee or director will not be permitted to retain that benefit, as the law treats money or corporate opportunities as belonging to the principal company. In addition to this, if the person owing the fiduciary duty earns further profits from a breach of fiduciary duties, those profits also belong to the principal. Principals are in some circumstances entitled to trace the property received through to third parties. Moreover, even if the person has spent the money or disposed of the assets in question, a fiduciary remains personally liable for the monetary equivilent of the benefit received.

Usage: The company director breached their fiduciary duty.

Related Words: fiduciary duties; fiduciary relationship.