Week 4 Flashcards
Fiduciary Duties, duty of care, and lawyers' immunity from suit (33 cards)
What is the essential quality of a fiduciary duty?
Loyalty - identifying fiduciary is to identify loyalty within a relo.
What is a fiduciary relationship?
An individual who is entrusted by others to act in their interests
How did Breen v Williams (1996) determine the essence of a fiduciary duty?
‘Fiduciaries give undivided loyalty to the person whom they serve’ and it is proscriptive only.
What are the general duties of fiduciaries?
- Not to place themselves in a position of conflict of duties b/w their interests v the client’s interests.
- Not to make a profit out of the trust.
- Not to act on own behalf or benefit of third parties without the client’s consent.
Does an equitable interest need a loss to be activated?
No.
What is the standard of conduct required of fiduciaries?
A demanding level of propriety of conduct - which exceeds torts standard of care and the standards imposed by contracts.
In Maguire and Tansey v Makronis, what was the central issue?
There was a mortgage in favour of Maguire and Tansey, which Makaronis had believed was in favour of Cth.
What was held in Maguire and Tansey v Makronis?
Loyalty to the clients was not undivided. Any interests that may conflict with the clients’ must be disclosed.
What was held in Clark Boyce v Mouat (1994)?
That the solicitors’ interests have bee fully disclosed and if they are likely to accrue significant benefits, to encourage clients to get independent legal advice.
Clark Boyce did precisely that with relation to Ms Mouat’s mortgage and were found not in breach of negligence.
What do the professional rules suggest about the duty of care for lawyers?
4.1.3 of Uniform Solicitors Rules: must deliver legal services competently, diligently and as promptly as possible.
35 Barristers’ Rules - client’s best interests must be protected to the best of the barrister’s skill and diligence.
What is the standard of care in tort?
Care, diligence and skill expected of a reasonably competent solicitor. - Midlank bank Trust
What constitutes a tort of negligence?
- Existence of a duty of care.
- An act or omission which could cause foreseeable harm.
- The act or omission was the cause of the loss.
What is the statute of limitations for negligence claims?
3 years
How does the duty of care apply in instances of inexperienced clients?
According to Carradine Properties v DJ Freeman and Co (1999), inexperienced clients = broader application of the duty as opposed to experienced clients.
How is it determined whether conduct is within the standard of a reasonably competent solicitor’s?
s 5O of Ciivl Liability Act - whether it is widely accepted by peer professional opinion as competent professional practice.
Can peer professional opinion always be relied on?
Not if the court deems the opinion to be irrational.
e.g. all lawyers must charge their clients exorbitant rates for services.
What was Roberts v Cashman all about?
Class actions suit against the drug Depo Medrol but no real interview conducted to grasp P’s claims: the P was unaware of the statute of limitations to do with BBC Hardware, no inspection of med reports.
What constituted a violation of the duty of care in Roberts v Cashman (2000)?
The D did not take reasonable care in discharging the retainer - they should have identified potential causes of actions and clarified further.
- D was v experienced in personal injury.
- Detailed med history of her was required.
- A reasonably competent lawyer would have arranged an interview.
Is the standard of care higher for legal specialists?
Yes, to a stricter standard.
Do solicitors have a duty to a third party (which is not their client)?
Yes, if the proximity test has been satisfied.
What does the proximity test entail?
- Reasonably foreseeability of harm
- Reliance on the solicitors by the 3rd party.
- Assumption of responsibility - for the performance of professional work requiring skill.
Which case explores the proximity test to establish a duty for a third party?
Hawkins v Clayton (1988).
What were the facts in Goddard Elliott v Fritsch [2012]?
Fristch was a mentally ill man, with complex commercial and tax legal issues, and the case reached settlement in favour of wife. He argued he lacked requisite mental capacity.
What was the decision in Goddard Elliot v Fristch?
There had been a breach of fiduciary duty bc Fritsch had no capacity to instruct Elliot and Elliot was reasonable aware/or should have been reasonably aware, of Fritsch’s lack of mental capacity.
