This Article was originally published by Thomson Reuters on May 18, 2012.
Claims for breach of fiduciary duty appear to have proliferated, possibly because the nature of the claim suggests some sort of outrageous or egregious conduct, on the one hand, while a finding of such wrongdoing may entitle the complainant to exemplary damages, on the other. Needless to say, the sine qua non for a claim of fiduciary duty is the existence of a fiduciary relationship. Under the circumstances, it is quite remarkable that, in so many cases, the existence of such a relationship is simply assumed and, as a result, the determination of whether or not a fiduciary relationship exists is often regularly litigated as a threshold and dispositive issue.
In the current millennium, the New York Court of Appeals has addressed questions relating to breach of fiduciary duty on almost two dozen occasions. And, because the determination of whether or not a fiduciary relationship exists is both a matter of law, in general, and often fact specific, in particular, the decisions on that threshold issue by the Court of Appeals raise as many questions as they answer.