Conceptions of the Fiduciary in Trust Law

Abstract

Statutory reform of trust law in New Zealand is taking the groundbreaking step of defining the express trust relationship. Part of the definition is that trusts are fiduciary relationships. As interpretation of the statute will take into account common law principles, this reform provides an opportunity to reflect on what fiduciary means in trust law. The article identifies five distinct conceptions of the fiduciary in trust cases. While all five are concerned with restraint on the trustees’ discretion, different trustees can be restrained by different standards of behaviour. The identified fiduciary conceptions range from the classical fiduciary, who must solely and exclusively act for the benefit of others, to the honest fiduciary, who is free to honestly benefit him or herself. The range of meaning in the common law will complicate interpretation of ‘fiduciary’ in the New Zealand legislation.

Keywords: fiduciary, fiduciaries, trust law, trusts, trustees, Trusts Act 2019