Breach of Fiduciary Duty
Dallas Business Tort Lawyers
The law recognizes the existence of fiduciary duties resulting for special relationships of trust or confidence in certain individuals. Fiduciary duties can arise out of formal relationships, such as a lawyer or partner, or even informal relationships, if the specific facts or circumstances require the imposition of fiduciary duties. Courts in Texas have commonly recognized the existence of fiduciary duties in the following relationships: Attorneys, employees, agents, escrow agents, insurance agents, holders of a power of attorney, corporate officers, joint venturers, executors and trustees, securities brokers, taxpayers, class representatives, mineral-rights holders, and condominium board members—just to name a few.
A fiduciary owes duties of loyalty and utmost good faith, the duty to refrain from self-dealing, a duty to act with fairness and honesty, and a duty of full disclosure. When these duties are breached, the victims of the breach often need to act swiftly to seek legal action to reverse course. A breach of fiduciary duty not only gives rise to a tort, it gives rise to special damages and remedies that are unique to fiduciary cases apart from common economic loss damages, such as disgorgement of ill-gotten gains or a constructive trust. In the case of misapplication of fiduciary property, many states, including Texas, recognize potential criminal exposure for these torts. These torts can manifest in all sorts of relationships from employees stealing information from their employer to a sophisticated partnership relationship deteriorating because intellectual property has been misappropriated.