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How contractual terms determine fiduciary duties: a two-stage process

Lookup NU author(s): Dr Derek WhaymanORCiD

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This is the final published version of an article that has been published in its final definitive form by School of Law, Queen's University Belfast, 2019.

For re-use rights please refer to the publisher's terms and conditions.


Abstract

The determination of the scope of the fiduciary duty of loyalty, when created by contract, is not a unitary process. It is raised following a multi-factorial enquiry, which considers the nature of the engagement, in a first stage. Here, no single factor is conclusive. It is then, in a separate, second stage, reduced by qualifying contractual terms, which are applied almost strictly logically. This second stage uses the contractual doctrines of interpretation and implication. However, since it is a form of the fiduciary doctrine of authorisation, those contractual doctrines are modified according to fiduciary principles. We argue this follows from the underlying nature of the fiduciary obligation as a way of resolving its internal tensions. While this division has not yet been fully recognised in the cases, the courts have been inching towards it. However, not fully recognising this inevitable division and eliding the two stages has led to defective reasoning and outcomes.


Publication metadata

Author(s): Gibbs-Kneller D, Whayman D

Publication type: Article

Publication status: Published

Journal: Northern Ireland Legal Quarterly

Year: 2019

Volume: 70

Issue: 2

Pages: 241-262

Online publication date: 04/07/2019

Acceptance date: 17/12/2018

Date deposited: 17/12/2018

ISSN (print): 0029-3105

Publisher: School of Law, Queen's University Belfast

URL: https://nilq.qub.ac.uk/index.php/nilq/article/view/263


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