Definition of FIDUCIARY: (noun) / a trustee; an agent who represents a principal and acts in the best interest of the principal “the executor serves as a fiduciary of the estate”
(adj) / involving trust, especially with regard to the relationship between a trustee and a beneficiary “the company has a fiduciary duty to its shareholders”
Plain English translation: a representative of another; one who serves as a fiduciary for another has, not surprisingly, a fiduciary obligation to that other person or entity. A fiduciary obligation requires the agent to act with the utmost loyalty, good faith, care, and confidence. Simply put, the agent must act in the principal’s best interest.
If we’re getting more technical (for you attorneys out there) . . .
The New York Estates, Powers, and Trusts Law (EPTL) defines a fiduciary as a person or entity who:
a) meets the description of a “personal representative”; or
b) who is designated by the creator of a trust or by the court to act as an assignee for the benefit of creditors, or a committee, conservator, curator, custodian, guardian, trustee or donee of a power during minority.1
A “personal representative” is a person who has received letters to administer the estate of a decedent. The term does not include an assignee for the benefit of creditors, or a committee, conservator, curator, custodian, guardian, trustee or donee of a power during minority.2
But EPTL § 1-2.7 brings these excluded positions within the definition of a “fiduciary.” Therefore, “fiduciary” is a broader term than “personal representative.”
1 EPTL § 1-2.7
2 EPTL § 1-2.13