Trustees & Executor are fiduciarys - they have important obligations that must be upheld
When a fiduciary relationship exists between parties to a transaction, equity raises a presumption of fraud when the superior party obtains a possible benefit, all dutys must be done. "This is... not so much because the fiduciary has committed a fraud, but because he may have done so." The superior party may rebut the presumption by showing, "that the confidence reposed in him was not abused, but that the other party acted on independent advice. some of the important dutys are: Take possession and maintain control of fiduciary assets; Keep fiduciary assets separate and distinct from all other assets; Maintain clear and accurate accounts and records; Provide information to beneficiaries in a timely manner; Exercise the same care and skill in administering the trust, as a person of ordinary prudence would exercise in dealing with his or her own property. This is generally referred to as the "prudent man" or "prudent investor" rule (states have adopted versio
Have you lost money by being taken advantage of by someone you had the right to trust?
fraud must allege (1) a relationship of trust and confidence, (2) that the defendant took Advantage of that position of trust in order to benefit himself, and (3) that plaintiff was, as a result, injured. The elements of a constructive fraud claim are proof of circumstances (1) which created the relation of trust and confidence [the "fiduciary" relationship],Put simply, a plaintiff must show (1) the existence of a fiduciary duty, and (2) a breach of that duty.the defendant must seek his own advantage in the transaction
Certain situations do not satisfy this requirement of a constructive fraud claim
The benefit of a continued relationship "is insufficient to establish the benefit required for a claim of constructive fraud.payment of a fee to a defendant for work done by that defendant does not by itself constitute sufficient evidence that the defendant sought his own advantage. In order to satisfy the second element of a constructive fraud claim, a plaintiff must allege that "the benefit sought was more than a continued relationship with the plaintiff or payment of a fee to a defendant for work it actually performed."IS THERE A DIFFERENCE BETWEEN A CONSTRUCTIVE FRAUD CLAIM AND A BREACH OF FIDUCIARY DUTY CLAIM?a claim for breach of fiduciary duty requires the existence of a fiduciary relationship.The requirement that the defendant sought to benefit wrongfully from the transaction is not an element of a claim for breach of fiduciary duty.
DIFFERENCE BETWEEN AN ACTUAL FRAUD CLAIM AND A CONSTRUCTIVE FRAUD CLAIM
constructive fraud differs from actual fraud in that 'it is based on a confidential relationship rather than a specific misrepresentation.'"A real estate agent has the fiduciary duty "to exercise reasonable care, skill, and diligence in the transaction of business entrusted to him, and he will be responsible to his principal for any loss resulting from his negligence in failing to do so."This duty requires the agent to "make a full and truthful disclosure [to the principal] of all facts known to him, or discoverable with reasonable diligence" and likely , This duty requires the agent to "make a full and truthful disclosure [to the principal] of all facts known to him, or discoverable with reasonable diligence" these are kinds of cases generaly involve insurance, brokerage, trustee relationships, banking, family, agent & their employers and other very close relationships
WHAT IS THE EFFECT OF PROVING A CONSTRUCTIVE FRAUD CLAIM?
When the superior party obtains a possible benefit through the alleged abuse of the confidential or fiduciary relationship, the aggrieved party is entitled to a presumption that constructive fraud occurred.equity raises a presumption of fraud when the superior party obtains a possible benefit and punitive damages may be avalable then the burden shifts to the defendant to prove he acted in an "open, fair and honest" manner, so that no breach of fiduciary duty occurred or he will be subject to punitive damages.
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