Many of the relationships that this Houston, Texas legal blog mentions frequently are what the law calls “fiduciary relationships.” To elaborate, guardians, executors of estates, attorneys in fact and trustees all have a fiduciary status, meaning that they have special legal obligations to another person or group even outside of a contract or other law.
These obligations vary slightly depending on the nature of the relationship between the fiduciary and the person whom the fiduciary is supposed to protect, but they all generally boil down to the fiduciary’s obligation to be unquestionably loyal to the person protected and also to take all reasonable steps to make sure the protected person’s best interests are being served.
In other words, a fiduciary like a trustee or executor must always remember that he or she represents the interests of another party and cannot look to his or her own interests as the primary guidepost for how to behave in a fiduciary situation.
Since trustees, executors, and fiduciaries exercise a great deal of financial responsibility over property and sometimes even person responsibility over people’s health and well-being, it is very important that they are well aware of their legal obligations and take all reasonable steps to make sure those obligations are carried out.
A beach of fiduciary duty occurs when a person who is in fiduciary position does not fulfill his or her obligations, even if due to an oversight or ignorance, and, as a result, the person who was supposed to get protected winds up losing valuable money or other things. A breach of fiduciary duty means the fiduciary may be removed from his or her position, and he or she may also have to compensate the injured party out of his or her personal funds.