Acquisition of property by a fiduciary of his principal is governed by two rules.Discuss
BACHELOR OF LAWS DEGREE TRUST LAW
DATE OF SUBMISSION: 25/11/2013
QUESTION: Acquisition of property by a fiduciary of his principal is governed by two rules..discuss
INTRODUCTION
“A fiduciary is a person holding the character of a trustee, or a character analogous to that of a trustee, in respect to the trust and confidence involved in it and the scrupulous good faith and cador which it requires” (blacklaws dictionary).
Lord Millet in Bristol and West Building Society V Mothew1 stated that a fiduciary is someone who has undertaken to act for and on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence.
Duties of a fiduciary
Bristol & West BS v Mothew, per Millett LJ:
The distinguishing obligation of the fiduciary is the obligation of loyalty. The principal is entitled to the single minded loyalty of his fiduciary. The duty is comprised of the following sub rules:
Must act in good faith
must not profit from the trust
Must not place himself in position where duty and interest no conflict May not act for own/third party benefit without informed consent of principal
Must prove any transaction with principal was fair and full disclosure
When a duty of care is imposed, equity requires an arguably stricter standard of behavior that that of a common law tortuous duty of care. He is required to be loyal at all times and to act for the sole benefit of the sole benefit of the beneficiary.
The basic general rule governing fiduciaries is that a person in a fiduciary position is not allowed to put himself in a position where his interests and duty conflict (no conflict rule).
The rule was laid down in the case of Keech V Sanford2.in the above case, a lease was renewed
DATE OF SUBMISSION: 25/11/2013
QUESTION: Acquisition of property by a fiduciary of his principal is governed by two rules..discuss
INTRODUCTION
“A fiduciary is a person holding the character of a trustee, or a character analogous to that of a trustee, in respect to the trust and confidence involved in it and the scrupulous good faith and cador which it requires” (blacklaws dictionary).
Lord Millet in Bristol and West Building Society V Mothew1 stated that a fiduciary is someone who has undertaken to act for and on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence.
Duties of a fiduciary
Bristol & West BS v Mothew, per Millett LJ:
The distinguishing obligation of the fiduciary is the obligation of loyalty. The principal is entitled to the single minded loyalty of his fiduciary. The duty is comprised of the following sub rules:
Must act in good faith
must not profit from the trust
Must not place himself in position where duty and interest no conflict May not act for own/third party benefit without informed consent of principal
Must prove any transaction with principal was fair and full disclosure
When a duty of care is imposed, equity requires an arguably stricter standard of behavior that that of a common law tortuous duty of care. He is required to be loyal at all times and to act for the sole benefit of the sole benefit of the beneficiary.
The basic general rule governing fiduciaries is that a person in a fiduciary position is not allowed to put himself in a position where his interests and duty conflict (no conflict rule).
The rule was laid down in the case of Keech V Sanford2.in the above case, a lease was renewed
Bibliography: blacklaws dictionary. Edelman.J. (2013). understanding the self dealing rule in equity. mohammed, r. (2010). unlocking trust 3th edition. hodder education. Penner.J. (2010). THE LAW OF TRUST 7th edition. london: oxford university press. scott, A. (1949, december). Retrieved from california law review: http://www.jstor.org/stable/3477686 The cambridge law journals. (2006, june 29). application of the rule in keech v sanford. Retrieved 11 2013, 21, from the cambridge law journals: http://dx.doi.org/10.1017