FIDUCIARY (Lat. fidneiarius, relating to a trust. from lid aria, trust. from to trust). A legal term designating a person in whom peculiar trust and confidence are reposed by an other. or tbe relation which subsists between suelt persons: or a liability incurred by one of these persons toward the other. The most im portant examples of fiduciary relations are those of parent and child, of guardian and ward, of lawyer and client, of physician and patient. of trli,tpc and erNitti qu' trust, of principal and agent. of principal and surety. and of partners. When the relationship does exist the rule obtains that the fiduciary—the per son in whom a special confidence and trust is reposed—is bound to act toward the other party to the relation with the utmost good faith. If he receives a gift from the other, or enters into a pontract with him, and its validity is challenged, the burden of proof is upon him to show that he took no advantage of his influence or knowledge, but, on the contrary, that the other acted with perfect freedom as well as with full knowledge of all the facts relating to the transaction. Indeed, in England a much stricter rule than this is applied to gifts from clients to legal advisers made during the con tinuance of the relationship; they may be set aside upon the application of the client or his personal representatives. In other words, the
presumption of undue influence in such a case is conclusive. A trustee or an agent, charged with the sale of property belonging to his cestui que trust, or his principal, is not allowed to be come the purchaser or to make any secret profit out of the sale.
The term 'fiduciary capacity' in the United States bankruptcy statutes has received a narrow construction. By these statutes debts contracted 'in any fiduciary capacity' are excluded from the operation of a discharge in bankruptcy. It has been ruled by the United States Supreme Court that the term in this connection includes only debts contracted by technical trustees—that is, trustees appointed by will or by deed or by order of a court, and does not extend to debts owing by agents or attorneys to their principals. Consult: Bigelow, Elements of Equity, for the Use of Students (Boston, 1879) ; Lowell, The Law of Bankruptcy (Boston. 1899) ; and the authorities referred to under such titles as AGENT; etc.