Can We Be Obliged to Be Selfless?
McGill University, Faculty of Law, Paul-André Crépeau Centre for Private and Comparative Law
September 24, 2013
A. Gold and P. Miller, eds., Philosophical Foundations of Fiduciary Law, Oxford University Press, 2014
It is generally agreed that fiduciary law is concerned with obligations that relate in some way to loyalty. The usual understanding is that there is something called a duty of loyalty. This paper explores the question whether there is a legal obligation of loyalty; and if so, what does it require? My argument is that the duty of loyalty is not a duty in the strict sense, that corresponds to a claim-right held by another person. Instead, the law incorporates a requirement of loyalty into the way in which the fiduciary exercises her discretionary powers. If they are exercised disloyally, the exercise can be set aside retroactively. This understanding helps us to make sense of the structure of fiduciary law, including the relationships between and among the requirement of loyalty, the no-conflict rules, and the no-profit rule.
Number of Pages in PDF File: 20
Keywords: fiduciary, loyalty, conflicts
JEL Classification: K1
Date posted: September 26, 2013 ; Last revised: December 13, 2013