Fiduciaries: when is self-denial obligatory?

Abstract

A highly paid agent sets out to undermine his principal’s business. A doctor wangles sex-for-drugs favours from a patient. An advisor offers self-interested advice to his client. A father engages in an incestuous relationship with his child. In each case the perpetrator is clearly a wrongdoer and the law must somehow respond. But what is the legal wrong and how should the law respond? The thesis advanced here is that it is too easy - and is ultimately unsatisfactory - to meet any justifiable moral outrage simply by tagging these people as fiduciaries and then applying against them the full remedial force of fiduciary law. If the law is to be applied consistently, predictably and efficiently, then categorisation of fact situations as illustrating particular wrongs and as meriting particular remedies must be more discriminating. There are real choices to be made in deciding how to develop this area of the law, choices which can be seen in operation in different forms in different Commonwealth jurisdictions. Albeit only in outline form, this article puts the case for a very tightly defined notion of fiduciary obligation and an equally restrictive view of the appropriate remedial response. It points to several issues which appear to work against precision in fiduciary law, and advocates a strict response. It concludes by attempting to pinpoint what appears to be critical in identifying fiduciaries