Fiduciary Duty
The legal obligation of a fiduciary to act in the best interest of the person they serve. This includes duties of loyalty (putting the other person first), prudence (acting carefully), and transparency (keeping accurate records).
Legal Definition
The highest standard of care recognized in law, encompassing duties of loyalty, prudence, impartiality, and full disclosure, owed by a fiduciary to the person or persons for whose benefit the fiduciary acts.
Practical Example
A trustee who uses trust funds to invest in his own business violates his fiduciary duty. He must keep trust assets separate from his own and invest them solely for the beneficiaries' benefit.