Law360: Fidelis Underwriting Ltd has said that the lessor and owners of three aircraft stranded in Russia after the country's invasion of Ukraine cannot reclaim US$77.2m for the planes from the reinsurer because they are not insured parties under Russian law.

Dispute Resolution analysis: Canaccord (formerly Collins Stewart), a second-tier provider of contracts for differences had a contract with a broker, Medsted, under which Collins Stewart was required to pay commission to Medsted in respect of investors introduced by Medsted. In breach of that contract, Collins Stewart did business directly with certain investors, thereby depriving Medsted of the commission to which it was entitled. At first instance the judge found that Medsted had suffered loss, but, on public policy grounds, awarded only nominal damages to Medsted, on the basis that Medsted was a fiduciary which had breached its fiduciary duties to the investors by failing to disclose the amount of commission it received from Collins Stewart. The Court of Appeal found: (a) that Medsted was a fiduciary, but (b) that, in the circumstances of the case, the scope of its duties did not extend so far as to require it to reveal the extent of its commission. It therefore allowed the appeal and made an order for damages to be assessed. Written by Iain G Mitchell QC (Scotland), barrister at Tanfield Chambers.

A person, or entity, who acts for the benefit and on behalf of another person or group of persons. A fiduciary holds a legally enforceable position of trust.

This Practice Note provides an overview of the law of fiduciary duties, focusing on practical issues. It covers identifying a fiduciary, the core fiduciary duty of loyalty, the no conflict rule, the no profit rule, and the fiduciary’s duties of care and skill and of confidentiality. It also provides an overview of the remedies available for breach of fiduciary duty, the approach to the quantification of profits for which a fiduciary is accountable and of the compensation payable by a fiduciary found to be in breach, accessory liability, and limitation periods for claims based on breach of fiduciary duty. Key terms A person who owes a fiduciary duty to another is termed a fiduciary. The terms fiduciary duty and fiduciary obligation have the same meaning. A trustee is a fiduciary who holds assets for another either under an express trust or in circumstances which in law amount to a trust. A breach of trust is a breach of fiduciary duty. A constructive trustee is a person upon whom the court imposes some or all of the obligations

A fiduciary duty indicates a relationship of trust, assurance or confidence between two or more parties, such as a company and its directors. Fiduciary duties are part of a wide range of equitable and common law duties evolved by the courts over many centuries. In the context of company directors, a number of key fiduciary duties are notable, including the duty to act in the best interests of the company, a duty to act within the powers conferred by the company's memorandum and articles of association, a duty not to fetter one’s own discretion, a duty to avoid a conflict of interest, and a duty not to make unauthorised profit. The essence of many of these fiduciary (and other common law or equitable) duties were codified in CA 2006, Pt 10 (see also Directors’ duties). However, the underlying common law rules and fiduciary principles continue to be relevant when interpreting and applying the statutory duties.

Commercial analysis: This case concerns Reading Football Club Ltd (the ‘Football Club’), who raised finance of US$22,374,000.00 (the ‘Financing’) from Global Fixed Income Fund 1 Ltd (the ‘Fund’), a fund of which Floreat Investment Management Ltd (FIML) was appointed the Investment Manager and which later became the assignee of the claim in these proceedings. The factual background to this case is voluminous, and this analysis focuses only on those facts pertinent to the legal points discussed. Further details of the facts of the case and how the Financing of the Football Club worked, can be found within the heart of the judgment, which looks at the various evidence that was given, including the 101 factual findings made by the Judge. Written by Sam Claydon (partner) and Callum Reid-Hutchings (paralegal) at CANDEY.

This Practice Note summarises the traditional fiduciary duties of company directors, including the duty to act in the best interests of the company, the no conflict and no profit principles, and the equitable duty of confidence. It also considers the remedies for breach of the duties, and the various ways in which a director may be relieved of the consequences of a breach, namely ratification, indemnity and insurance. What is a fiduciary relationship? A fiduciary duty indicates a relationship of trust, assurance or confidence between two or more parties. While there is no inherent limit to the types of relationship that would be construed as fiduciary under the common law, some relationships are automatically fiduciary, eg those between trustee and beneficiary, solicitor and client, principal and agent, business partner and co-partners, mortgagor and mortgagee. Other relationships will be characterised as fiduciary if one person has agreed to act for or on behalf of another in circumstances where a relationship of trust and confidence is deemed to have arisen (eg between a family member and an elderly relative

This Practice Note looks at the fiduciary duty of confidentiality, wrongful and fraudulent trading, as well as the importance of managing roles in local authorities and companies. For further information on local authority companies, see Practice Note: Local authority companies. For further information on directors’ duties, see Practice Note: Duties of directors of local authority companies under CA 2006. Fiduciary duty of confidentiality What is a fiduciary relationship? A fiduciary relationship arises under common law where A and B agree that: • A will act on behalf of or for the benefit of B in circumstances which give rise to a relationship of trust and confidence • A has some discretion or power which affects B's interests, and • B in turn relies on A for information or advice Fiduciary duties are owed by: • partners (to their fellow partners) • solicitors and other professional advisers (to their clients) • trustees (to beneficiaries) • agents (to principals) • directors Confidentiality Most of the fiduciary

DR analysis: Mr Justice Newey has arrived at a number of reasons why he believes that shadow directors commonly owe fiduciary duties to the company they influence, at least to some degree (above and beyond the express provisions in the Companies Act 2006 as regards declaring interests). In so doing, he analysed Ultraframe, a decision which has received a mixed reception amongst academics, before concluding that Ultraframe understates the extent to which shadow directors owe fiduciary duties. Although this is only a judgment at first instance and so of equivalent persuasion to that of Ultraframe, it ought to make shadow directors think more carefully about the scope of their potential responsibilities to the companies they influence. It will be for a future higher court to determine whether Newey or Lewison had the correct approach.

Fiduciary duties of trustees are the core obligations owed by trustees to beneficiaries when administering a trust. They require trustees to act exclusively in the beneficiaries’ best interests, to exercise their powers for proper purposes, and to avoid conflicts of interest and unauthorised profits. Across England and Wales, Scotland, Northern Ireland and Ireland, the concept is primarily developed through trust law case law, supplemented by statute (for example, the Trustee Act 2000 and Trustee Act (Northern Ireland) 2001; in Scotland, the Trusts and Succession (Scotland) Act 2024; in Ireland, the Trustee Act 1893 as amended and the Land and Conveyancing Law Reform Acts). Key fiduciary duties include the duty of loyalty, duty to act honestly and in good faith, duty not to profit from the trust without authority, and duty to consider and fairly balance beneficiaries’ interests. These sit alongside, and interact with, separate duties of care, investment duties and administrative duties. In practice, fiduciary duties of trustees underpin trustee decision‑making, trust litigation, claims for breach of trust, removal of trustees, and professional negligence risk for solicitors and other professional trustees. Usage and core principles are broadly consistent across the jurisdictions.

Practice Note: Restitution for wrongful acts sets out the different types of wrongs for which a restitutionary remedy may be available. Where the wrong is a breach of fiduciary duty from which the defendant has profited, then the court has a discretion to order the defendant to account for those profits that they have made or pay equitable compensation or the court may decide to recognise a constructive trust where profits are made from the principal’s property or exploitation of an opportunity that should have been available to the principal. This Practice Note sets out the different remedies that may be available where a fiduciary has acted in breach of their fiduciary duties. Fiduciaries and their duties A fiduciary is someone who has undertaken to act for and on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence (Boardman v Phipps). Common cases where breaches of fiduciary duties occur are in the employment context or where a director is involved in wrongdoing (Lister

A fiduciary duty is an obligation to act loyally, honestly and in good faith for the benefit of another person, putting that person’s interests ahead of one’s own and avoiding conflicts of interest and unauthorised profits. It typically arises where one party has undertaken to act for or on behalf of another in a position of trust and confidence, for example company directors, trustees, partners, agents and some financial or professional advisers. In England and Wales and Northern Ireland, fiduciary duties are largely defined and developed by case law (notably in equity) rather than comprehensive statute, though particular relationships (such as directors’ duties under the Companies Act 2006) have statutory expression. In Ireland and Scotland, the concept is similarly grounded mainly in judge‑made law, with Scottish law often framing similar ideas in the language of trust and confidence within the law of obligations. Key elements include duties of loyalty, no‑conflict, no‑profit, confidentiality and proper purpose. Breach of fiduciary duty can lead to remedies such as rescission, account of profits, constructive trusts and equitable compensation. Usage and core concepts are broadly consistent across the UK and Ireland, though terminology and doctrinal foundations differ slightly between jurisdictions.