A fiduciary duty is a duty to act in the interest of another individual with respect to certain transactions, even above one’s own interest.
A fiduciary is obligated to act in good faith and to act with care and loyalty toward those to whom they owe fiduciary duties.
If you believe someone involved in your business has violated their fiduciary duties, you may have a cause of action to recover for any resulting damages. A knowledgeable business attorney can help you determine the best way to protect your business from a breach of fiduciary duty.
Business partners, employers and shareholders must constantly trust that their partners, employees, or corporate officers will act for their best interest. Sometimes, these trusted fiduciaries put their own interests first, which can give rise to a legal claim for damages.Business Disputes Attorney Michael Long
What Are the Breach of Fiduciary Duty Elements in Florida?
To establish a breach of fiduciary duty in Florida, a plaintiff must establish the following elements:
- Existence of a fiduciary relationship,
- Breach of a fiduciary duty, and
- Damages caused by the breach.
Once these elements are established, a plaintiff may recover compensations for losses sustained as a result of the breach of fiduciary duty.
To prove a breach of fiduciary duty in Florida, a plaintiff must first establish that a fiduciary relationship existed. Common fiduciary relationships arising in the business context include:
- Business partners,
- Corporate officer/shareholder, and
Each of these relationships involves specific fiduciary duties of good faith, care, and loyalty.
Breach of Fiduciary Duty
The business relationships mentioned above give rise to specific fiduciary duties in Florida.
These duties may vary depending on the type of relationship involved. But the crux of all these duties is that the fiduciary is legally required to act for the benefit of the individual to whom they owe a duty.
Business partners owe one another fiduciary duties under Florida law. These duties are specifically outlined by the Florida Statutes. They include duties to:
- Account to the partnership for any profits received from conducting partnership business or using partnership property;
- Not act on behalf of parties with interests adverse to the partnership;
- Not compete with the partnership;
- Not conduct business recklessly or with gross negligence; and
- Not intentionally engage in misconduct or knowingly violate the law in conducting business.
Partners aren’t forbidden from all activities that further their own interests, but they can be held to have violated a fiduciary duty if they do not comply with their statutory partnership duties.
Corporate officers have a fiduciary duty to the company’s shareholders. A corporate officer’s fiduciary duty in Florida requires them to:
- Exercise their powers in the interests of the corporation;
- Work for the benefit of all shareholders;
- Become informed of all material information that is reasonably available prior to making a decision;
- Not take illegal actions on behalf of the company;
- Disclose any conflicts of interest; and
- Obtain approval from neutral directors or shareholders for any transaction of the corporation in which the corporate officer has an interest.
The Florida Statutes also generally require corporate officers to act in good faith and in a manner they reasonably believe is in the best interests of the corporation.
Employees also have a fiduciary duty to their employer. An employee may violate their duty by doing things like:
- Taking a business opportunity from the company;
- Stealing trade secrets from the employer;
- Engaging in a competing business; or
- Defrauding the employer.
Employers can pursue legal action against employees who breach their fiduciary duties to the employer.
Various remedies may be available when a breach of fiduciary duty damages the individual to whom the duty is owed.
A victim may seek both compensatory and punitive damages. A victim may also seek equitable relief, such as an injunction, an accounting, or disgorgement of profits.
An experienced business attorney can help you calculate your potential damages and determine what types of remedies may be appropriate in your case.
How Can BrewerLong Protect Your Business After a Breach of Fiduciary Duty in Florida?
If you believe you have a cause of action for breach of fiduciary duty, contact the legal team at BrewerLong today. Our attorneys have extensive experience representing businesses of all sizes in complex legal disputes.
Call us or contact us online to set up a consultation. We can answer your questions about the breach of fiduciary duty elements in Florida and help you determine a legal strategy to address your claim.
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