
Contents
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I. Introduction I. Introduction
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II. Standards of Conduct II. Standards of Conduct
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A. The No-Conflict Rules A. The No-Conflict Rules
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B. The No-Profit Rule B. The No-Profit Rule
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C. The Duty of Good Faith C. The Duty of Good Faith
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D. Duties of Disclosure D. Duties of Disclosure
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E. Relation to Other Duties E. Relation to Other Duties
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III. Remedies III. Remedies
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IV. Contexts That Modify Fiduciary Loyalty IV. Contexts That Modify Fiduciary Loyalty
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A. Contractual Modifications and Waivers A. Contractual Modifications and Waivers
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B. Multiple Beneficiaries B. Multiple Beneficiaries
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C. Additional Factors That Affect Application C. Additional Factors That Affect Application
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V. The Theory of Loyalty V. The Theory of Loyalty
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VI. Conclusion VI. Conclusion
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Acknowledgments Acknowledgments
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20 The Fiduciary Duty of Loyalty
Get accessAndrew S. Gold, Brooklyn Law School
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Published:09 May 2019
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Abstract
This chapter addresses the fiduciary duty of loyalty. Loyalty is a central concept in fiduciary law, even as scholars differ on whether we should reason from fiduciary relationships to loyalty obligations, or the other way around. Nonetheless, the common view across jurisdictions and across theories is that loyalty is vital to fiduciary relationships. This chapter first provides an overview of the core features of fiduciary loyalty, with particular emphasis on the no-conflict rules, which have two basic components: a rule against conflicts of interest and a rule against conflicts of duty. It then considers the no-profit rule and how it relates to the rules against conflicts of interest, along with duties of good faith and disclosure and the link between fiduciary loyalty and other obligations. It also discusses remedies that are generally associated with breach of loyalty, including the disgorgement remedy, as well as specific contexts that modify the effect or scope of fiduciary loyalty obligations (for example, contractual modifications of legal default rules or cases where there are multiple beneficiaries), and additional factors that affect application of the fiduciary duty of loyalty. The chapter concludes with an analysis of theories that explain fiduciary loyalty as a category.
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