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LSDefine
Simple English definitions for legal terms
fiduciary
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A quick definition of fiduciary:
A fiduciary is someone who has a responsibility to act in the best interest of someone else. This means they must make decisions that will benefit the other person financially. When someone has this responsibility, it creates a special relationship called a fiduciary relationship.
A more thorough explanation:
Definition: A fiduciary is a person who has a legal obligation to act in the best interest of another person or entity. This obligation is known as a fiduciary duty. When someone has a fiduciary duty to someone else, they must act in a way that will benefit the other person financially.
For example, a financial advisor has a fiduciary duty to their clients. This means that they must act in the best interest of their clients when making investment decisions. They cannot make decisions that benefit themselves at the expense of their clients.
Another example is a trustee of a trust. The trustee has a fiduciary duty to the beneficiaries of the trust. They must manage the assets of the trust in a way that will benefit the beneficiaries.
These examples illustrate the definition of a fiduciary because in both cases, the person with the fiduciary duty must act in a way that benefits someone else financially. They cannot act in their own self-interest or make decisions that harm the other person or entity.