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LSDefine

Simple English definitions for legal terms

fiduciary duty

Read a random definition: John Doe warrant

A quick definition of fiduciary duty:

Fiduciary duty means that someone has to act in a way that will benefit someone else financially. The person who has this duty is called the fiduciary, and the person they owe it to is called the principal or beneficiary. If the fiduciary doesn't do their duty, they have to give back any money they made and the beneficiary can sue them. This duty applies to directors of corporations too, who have to act with care and loyalty to the company and its shareholders. Other people who have fiduciary duty include lawyers, agents, guardians, priests, and doctors.

A more thorough explanation:

When someone has a fiduciary duty to someone else, they must act in a way that will benefit the other person financially. The person who has the duty is called the fiduciary, and the person to whom the duty is owed is called the principal or beneficiary. If the fiduciary breaches their duties, they would need to account for any ill-gotten profit, and the beneficiaries are typically entitled to damages.

One example of fiduciary duty is when directors of corporations have certain responsibilities to fulfill. They are charged with the duty of care, which requires them to inform themselves of all material information reasonably available to them before making a business decision. They must also assess the information with a critical eye to protect the interests of the corporation and its stockholders. The duty of loyalty means that all directors and officers of a corporation must act without personal economic conflict. They are not permitted to use their position of trust and confidence to further their private interests. The duty of good faith requires them to advance the interests of the corporation and fulfill their duties without violating the law. The duty of confidentiality requires them to keep corporate information confidential and not disclose it for their own benefit. The duty of prudence requires a trustee to administer a trust with the degree of care, skill, and caution that a prudent trustee would exercise. The duty of disclosure requires directors to act with complete candor and disclose all relevant facts and circumstances to the stockholders in certain circumstances.

Another example is when attorneys have a fiduciary duty to their clients, a principal to an agent, a guardian to the ward, a priest to the parishioner, and a doctor to the patient. Fiduciary duty is imposed whenever confidence is reposed on one side in a contractual relationship, so as to allow that side to exert influence and dominance over the other.

These examples illustrate how fiduciary duty requires a person to act in the best interests of another person or entity, and to avoid any conflicts of interest that could harm the other party.

fiduciary duties of trustees | fiduciary relationship

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NosyBeagle
19:28
Do tell
i had to drop out of a grad program but i explained it in my gpa addendum bc it was the same underlying event causing both
i was also named in a civil lawsuit that got dismissed but only one school asked about it
sorry probably not helpful
ParallelAgreeableOrangutan
19:58
idk what the situations are, but you absolutely should write about them if the school asks about them—the only time you should be asking *whether* to write one is when you're not sure whether your situation qualifies as what they're asking about
ParallelAgreeableOrangutan
19:59
better question is usually *how* to write about them
ParallelAgreeableOrangutan
20:00
I had to write about write
ParallelAgreeableOrangutan
20:01
... write-ups at work (petty, and they were removed from my file after a year, but even so the app asked so I wrote)
NosyBeagle
20:05
Ah it cancelled out my msg cus I switched tabs. But I’ll just tell you guys cus I get mixed answers: a) accused of cheating on a calc exam freshman year but was cleared of wrongdoing, b) sent to the hospital senior year because I go too drunk
ParallelAgreeableOrangutan
20:12
Seems like you'd need to write about A because it went through a formal process, but it shouldn't hurt you if you explain it straightforwardly and explain you were cleared (just don't be weirdly salty about it like you're holding a grudge)
ParallelAgreeableOrangutan
20:12
Re B, did this involve school in any way? Is there an app that has a C&F question that you think this applies to?
ParallelAgreeableOrangutan
20:13
Maybe you're not deep enough into the process to know this—each school has its own unique set of C&F questions, so you should disclose exactly what they ask about, no more, no less
NosyBeagle
20:14
OH
NosyBeagle
20:14
Ok why did I think it was just gonna be one type of q for all. My bad folks. Ignore my info dump
ParallelAgreeableOrangutan
20:16
No worries! Frankly I think it's wild that applications have weird hidden quirks that you don't know about until you're actually logged into LSAC working through the app. There's some info you can find about the oddball/unique questions you'll find on specific apps, so you might want to look for that for schools you're going to apply to
ParallelAgreeableOrangutan
20:17
Like on various consultants' blogs, reddit, etc
NosyBeagle
20:17
🫡 thank you good sir or ma’am or bam
ParallelAgreeableOrangutan
20:17
Ooh can I be a bam
NosyBeagle
20:39
You may
20:45
ima write my personal statement about being fired and how that made me want to do law but it would be funny if I also had to write an addendum about it
20:45
turns out defense companies don’t like it when you question the war machine 🙏
20:46
“What are your opinions on Edward Snowden” - my boss
ParallelAgreeableOrangutan
21:02
I wrote optional essays about a situation that affected my undergrad performance. For any school that required an "education gap addendum" I was basically like "pls see my optional essay"
ParallelAgreeableOrangutan
21:02
¯⁠\⁠_⁠(⁠ツ⁠)⁠_⁠/⁠¯
NosyBeagle
21:12
did they accept that?
NosyBeagle
21:12
that reminds me of filling out job apps and they want you to type out your resume in a text box. like huh??? open the pdf, idiots
ParallelAgreeableOrangutan
21:18
I mean I was nicer about it—I'd put a couple of sentences explaining it super lo-res, and then I said something like "I speak to this situation in detail in my optional essay."
ParallelAgreeableOrangutan
21:20
They don't send your application back to you and tell you to redo an addendum if they don't like it, so the only way to know whether they "accepted" it, as it were, is admissions results
Bettercaulsaul
22:28
Helpful video I found https://youtu.be/2ZVrX6DTSKU?si=KsZeWbF4_fJuqKl5
23:17
who up lsdin they law
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