Do Spouses owe each other a Fiduciary Duty? | WEL Partners Blog
Family Code Section | The Starting Point for All Interspousal Fiduciary Duty Analysis in Divorce! In financial transactions between spouses (so-called. of fiduciary duty, the type of information that must be disclosed between spouses, and whether information must be disclosed “upon request” or. The trial court entered a judgment finding that the ex-husband breached a fiduciary duty to his former wife and awarded her all the net proceeds.
Allegations involving community property may be brought as constructive or actual fraud. A finding that one spouse has committed marital fraud or another type of marital tort can have significant ramifications for divorce proceedings.
In addition to fraud, personal conduct can sometimes constitute a breach of fiduciary duty.
Court Rejects Claim That Ex-Spouses Owed Each Other Fiduciary Duties | Texas Fiduciary Litigator
However, while courts in Texas have consistently held that spouses owe one another fiduciary duties in respect to community property, rulings have been less unified regarding personal behaviors.
Remedies under Texas Family Law If it is found that one spouse has committed fraud, there are several legal remedies available to the wronged partner. Then, this value is divided by what is just and right, with the wronged spouse typically receiving a disproportionately large share of assetsmoney judgment.
Other remedies under Texas family law can include constructive trusts, resulting trusts, and quantum meruit.
Court Rejects Claim That Ex-Spouses Owed Each Other Fiduciary Duties
When claims are brought against a third party, a spouse may seek restitution through the court ordered return of property, money judgment, or credit against community estate that otherwise be awarded to the spouse. However, a discovery clause may allow this clock to begin ticking starting from when the wronged spouse discovered or should have reasonably learned of the damage.
Aggressive Family Law Attorneys in Houston If you believe that your spouse has acted fraudulently, you cannot afford to postpone taking legal action. The courts refer to these as per se fiduciary relationships. The courts also recognize that the category of per se fiduciary relationships is not closed; other kinds of relationships could also be characterized as fiduciary in nature, depending on the facts and circumstances of a particular case.
The court refers to these potentially fiduciary relationships as ad hoc fiduciary relationships. In California, statutes provide that spouses stand in a fiduciary relationship subject to the same duties as nonmarital business partners, but it does not extend to matters of health or fidelity. The Supreme Court of Canada has not yet been asked to determine the issue of whether or not spouses owe each other a per se or ad hoc fiduciary duty of care, although it has, in obiter, cited a list of per se fiduciary relationships from a lower court which included spousal relationships.
Should Spouses be Fiduciaries? The existence of a fiduciary duty as between spouses raises interesting questions. On the one hand, it does not seem unreasonable for spouses to expect each other to honest, candid, and forthcoming. But can we go so far as to assert that all spouses have expressly or impliedly undertaken to uphold these duties such that they would be liable for a breach of fiduciary duty? Would the presence of fiduciary duties in spousal relationships change our ideas about marriage?
Can spouses be Fiduciaries? Spousal relationships arise in all manner of circumstances, for an infinite number of reasons that may or may not be expressly stated, or implied, or even understood.Breach of Fiduciary Duty
Recall that, as we have written at length in this blog and elsewhere, the common law pertaining to the capacity to marry is unsettled, and historically the capacity threshold has been very low. In general, spouses are required to understand only the most basic components of marriage, such as the commitment of the spouses to be exclusive, that the relationship is to be terminated only upon death, and that the marriage is to be founded on mutual support and cohabitation.
Would it be fair or reasonable to hold spouses to a fiduciary standard when they are not even required to understand or appreciate the property rights attached to marriage via the Family Law Act?
What would be the scope of that fiduciary duty? Fiduciary relationships are, generally speaking, characterized by the duty to avoid conflicts of interest and self-interested dealings.
Do we agree that spouses must not put their own interests above the interests of their spouse? Our first impulse may be to answer that question in the affirmative, but it is not difficult to think of a number of situations in which spouses, in the ordinary course, place their own interests first.
How would equitable remedies assist the injured party?
In criminal law, failing to disclose health status to a partner can give rise to a charge of aggravated sexual assault, but criminal proceedings are intended to punish the perpetrator — they do not compensate or financially assist the victim. The Supreme Court of Canada has stated that while both the tort of negligent misrepresentation and the equitable claim of breach of fiduciary duty arise in reliance-based relationships, the presence of loyalty, trust, and confidence distinguishes the fiduciary relationship from a relationship that simply gives rise to tortious liability.
Do we agree that marriages are reliance-based relationships of loyalty, trust, and confidence as regards our health? If yes, what would the remedy be? These issues are raised in the claim that was recently before the Honourable Justice Carol J.
Does Your Spouse Owe You a Fiduciary Duty? - Laurent Legal
This has been recognized in Fiduciary Duties, supra, where Michael Ng writes: Ginsburg14 O. The plaintiff had alleged that the defendant breached his fiduciary duty by failing to disclose sexual activities that exposed the plaintiff to the risk of contracting sexually transmitted disease.
At paragraph 2 of the decision, Justice Rosenberg determined that the three-step test in Frame v. Smith had been met insofar as: For these reasons, Rosenberg J.