You are in: Home > Legal

Breach of Fiduciary Duty Lawsuits in California

26th January 2010
By Laine T Wagenseller in Legal
RSS Legal RSS    Views: N/A

Lawsuits for breach of fiduciary duty often arise in partnership or shareholder litigation. As per California's Supreme Court fiduciary duty is defined as arising whenever trust and confidence is reposed by one person in the integrity and fidelity of another and that person obtains control over the other person's affairs. In simpler terms, it is a legal relationship evolving between two or more members involving the legal responsibility for

  • Investing Money

  • Acting for a party's benefit

  • Disclosing all material facts

  • Employing logical care to avoid clients that misleads

Examples of fiduciaries are Corporate board members, Mortgage brokers, Financial planners or business partners acting and serving as fiduciaries. Basically fiduciaries are those people having some authority to exercise. In a partnership lawsuit you will often see causes of action for breach of contract (the partnership agreement), fraud (a partner misrepresented or concealed a material fact), breach of fiduciary duty (the partner betrayed the plaintiff) and accounting (let's figure out how much the partner stole or how much damage he caused).

If one party made a misrepresentation or concealed material facts from another party, a cause of action for fraud may be appropriate but not necessarily a cause of action for breach of fiduciary duty. The fact that two parties may share in the profits of an endeavor or be contractually entitled to an accounting against each other similarly does not transform a breach of contract action into a breach of fiduciary duty case. 

So, if you are in a belief and suspect that you are the victim of a breach of fiduciary duty, then without any delay immediately contact an expert lawyer. It is recommendable to always seek help of an experienced lawyer having a track record of resolving numerous cases.

In some instances a fiduciary duty can be defined by the parties themselves in their contract.  For example, California law has recognized that a real estate broker may draft an agency agreement which states that the relationship between the broker and the purchaser or seller is at arm's-length and is neither confidential nor fiduciary.

A breach of fiduciary duty lawsuit in California must include the following elements:  (1) a fiduciary duty, (2) a breach of that fiduciary duty, and (3) damage arising from that breach of duty.  The plaintiff will have the burden of proving that the defendant had a fiduciary duty towards him or her and that the plaintiff breached that duty.  Moreover, plaintiff must prove that some damage arose from the breach of the duty.

As a general rule, it is a question of fact whether a fiduciary duty founded upon a contract exists.  This means that it may be difficult to resolve a breach of fiduciary duty lawsuit on a motion for summary judgment.  The court or the jury will need to hear testimony and weigh the credibility of the parties in order to make a determination as to who is telling the truth.

Laine T. Wagenseller is an attorney in Los Angeles and the founder of Wagenseller Law Firm. He specializes in Business litigation law firm, including Los Angeles Partnership and Shareholder Litigation Attorney. If you have a question about a breach of fiduciary duty lawsuit, please visit our website at or contact Mr. Wagenseller at (213) 996-8338 or
This article is copyright
Bookmark and Share

Ask a Question about this Article

powered by Yedda