Breach of Fiduciary Duty

Experienced Breach of Fiduciary Duty Attorneys in San Mateo County

Businesses are complex entities. The average company has dozens or hundreds of moving parts, each of which needs to be properly managed by someone with the appropriate experience and knowledge. Almost every business relies on one or more fiduciaries to operate.

However, breach of fiduciary duty is a real and painful problem for many companies. If a fiduciary fails to live up to their responsibilities, a business can suffer significant financial losses. That’s why it’s so important to work with an experienced business litigation attorney if you suspect your company has suffered from someone’s breach of fiduciary duty.

The qualified lawyers at the Law Offices of Katherine R. Moore, in Redwood City, California, can help you navigate the complicated waters of fiduciary law. Whether you need to determine what fiduciaries are involved in your business or take action against a fiduciary’s fraud or negligence, we are prepared to take your case.

Who May Act as a Fiduciary?

A fiduciary is a party that manages a financial transaction or account for another party. Fiduciaries can be individuals or organizations, and they can operate on behalf of individuals, organizations, or trusts. What matters is that the they have agreed to manage another party’s finances in some way and therefore has an obligation to act in that party’s best interests.

There are many ways in which fiduciaries can help a company. Some of the most common business fiduciaries include:

  • Business partners: Anyone with control over a business has a responsibility to their partners to act in favor of the company.
  • Board members: As with business partners, board members have control over the business and therefore an obligation to act in its best interests.
  • Financial advisers: All financial advisers have a fiduciary relationship with the parties they advise, businesses included.
  • Investment brokers and administrators: Stockbrokers, investment firms, and investment administrators are all responsible for doing what’s best for their clients instead of themselves.
  • Real estate agents: A real estate agent must support their clients’ interests above their own.

What Are Fiduciary Duties?

Depending on why someone is acting as a fiduciary, they could be responsible for many things. For instance, a financial adviser must give well-considered advice on how a business uses its funds, and a real estate agent is responsible for buying or selling their clients’ property for the best possible price.

However, there are three fundamental duties that all fiduciaries must keep in mind. These are:

  • Duty of Reasonable Care: First and foremost, fiduciaries need to demonstrate reasonable care when performing their duties. This means acting the way a “reasonable person” would have done in the same situation. If they fail to act reasonably, they are not performing this duty correctly.
  • Duty of Loyalty: Fiduciaries must put the interests of their clients above their own. For example, a stockbroker cannot “churn” accounts, or make many sales and purchases, to increase the number of commissions they receive.
  • Duty of Disclosure: Fiduciaries have to provide their clients with all relevant account or transaction information at their request. They must also be honest about their accounts and transactions and not mislead clients to influence their decisions.

What Is Breach of Fiduciary Duty?

A breach of fiduciary duty occurs when someone fails to live up to the loyalty, disclosure, and reasonable care requirements. Examples of breaches of fiduciary duty include:

  • A real estate agent directing clients only to more expensive properties to increase their commission.
  • An investment firm concealing account information to prevent clients from understanding their actual financial status.
  • A board member directing the company to make purchases from a family member’s business despite it costing the business more money.
  • A business partner concealing critical operational details from other partners or stakeholders to avoid repercussions.

Essentially, whenever fiduciaries lie, neglect their responsibilities, or act in their own best interests, they’re breaching their duties.

Hold Your Fiduciaries Accountable for Their Actions

By definition, a fiduciary is supposed to have your business’s best interests at heart. If you believe one of your fiduciaries has breached their duty to your company, you shouldn’t hesitate to reach out for help.

An experienced, knowledgeable attorney can make all the difference. The qualified lawyers at the Law Offices of Katherine R. Moore have the knowledge and expertise to help you hold your fiduciaries accountable for their actions.

You can contact us at our Redwood City, California offices today to schedule your consultation or learn more about how the right lawyer can resolve breach of fiduciary duty claims. We proudly represent business interests around California.