During the course of estate planning conversations in Virginia, the term fiduciary will often arise. However, understanding exactly what this term means is not always straightforward. Essentially, a fiduciary is a person who has been legally appointed to act in the best interests of another person.
Common fiduciary roles include a guardian who has been tasked with taking care of minor children in the event that a parent dies prematurely. Additionally, a fiduciary may be a personal representative who oversees the distribution of your estate in the event of probate. Outlined below are the key responsibilities of fiduciaries in Virginia.
A duty of care
All fiduciaries owe a duty of care. This means that they are required to behave in a manner that is reasonable and shows good faith. For example, a legal representative has a duty not to act in a manner that is irresponsible or reckless and therefore damaging to the best interests of the client.
A duty of loyalty
In fiduciary relationships, the interests of the represented party are expected to come before all else. For example, in a trust, a trustee must not act in a manner that profits themselves or disregards the interests of beneficiaries.
Duty of full disclosure
A fiduciary must not intentionally withhold or suppress information from the people their services are intended to protect. For example, in the case of a will or trust, a fiduciary will generally be obliged to inform beneficiaries of the existence of legal documents as well as the rights contained within them.
When planning your estate, it is important to consider which factors are a priority to you. It is crucial to know that you have legal rights and protections in Virginia.