Book contents
- Fiduciary Obligations in Business
- Fiduciary Obligations in Business
- Copyright page
- Dedication
- Contents
- Contributors
- Editors’ Acknowledgments
- Introduction The Decline and Rise of Fiduciary Obligations in Business
- Part I Identifying Fiduciaries and Their Duties
- 1 Fiduciary Duties on the Temporal Edges of Agency Relationships
- 2 Extra Large Partnerships
- 3 The Three Fiduciaries of Delaware Corporate Law—and Eisenberg’s Error
- 4 Trust, Discretion, and ERISA Fiduciary Status
- 5 Examining Indenture Trustee Duties
- Part II Gaps and Alternatives in Fiduciary Regimes
- Part III Historical and Comparative Perspectives
- Part IV Stakeholders and Society
- Index
3 - The Three Fiduciaries of Delaware Corporate Law—and Eisenberg’s Error
from Part I - Identifying Fiduciaries and Their Duties
Published online by Cambridge University Press: 20 August 2021
- Fiduciary Obligations in Business
- Fiduciary Obligations in Business
- Copyright page
- Dedication
- Contents
- Contributors
- Editors’ Acknowledgments
- Introduction The Decline and Rise of Fiduciary Obligations in Business
- Part I Identifying Fiduciaries and Their Duties
- 1 Fiduciary Duties on the Temporal Edges of Agency Relationships
- 2 Extra Large Partnerships
- 3 The Three Fiduciaries of Delaware Corporate Law—and Eisenberg’s Error
- 4 Trust, Discretion, and ERISA Fiduciary Status
- 5 Examining Indenture Trustee Duties
- Part II Gaps and Alternatives in Fiduciary Regimes
- Part III Historical and Comparative Perspectives
- Part IV Stakeholders and Society
- Index
Summary
This chapter argues that corporate law is unique in a way that is not widely recognized, and is not unique in the way it is widely thought to be. First, unlike other fields of law where fiduciary obligations play a key role, in corporate law, not one, not two, but three distinct actors owe fiduciary duties—executive officers, directors, and controlling shareholders. The beneficiaries of those actors' duties, the reasons for imposing duties, and the scope and demands of fiduciary duties differ for the three actors. Thus, there is not a singular duty of care and loyalty in Delaware corporate law, but multiple variations of those duties owed by multiple actors. Delaware has a law of fiduciaries, not a fiduciary law. Second, this chapter challenges the supposed standard of conduct-standard of review divergence first hailed in 1993 by Professor Melvin Eisenberg as unique to corporate law.The construct was descriptively inaccuratewhen Professor Eisenberg first wrote, it has been little used by the Supreme Court since then, and the standards often converge rather than diverge.
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- Fiduciary Obligations in Business , pp. 57 - 73Publisher: Cambridge University PressPrint publication year: 2021