Does the holder of a POA owe a general fiduciary duty to the principal?

Does the holder of a POA owe a general fiduciary duty to the principal?

Under Texas law the holder of a power of attorney, as an agent,  owes the principal a fiduciary duty.  In situations involving a transaction between the agent and the principal, Texas law closely scrutinizes the transaction and places the burden on the agent to prove the fairness of the transaction to the principal.

But what if the agent doesn’t actually use the POA as part of the transaction in question?  Does the burden still fall on the agent to prove the fairness of the transaction and show that full disclosure was made to the principal?

Texas courts typically answer yes. A principal granting a general power of attorney creates a fiduciary relationship that exists independently of whether the particular transaction was actually consummated via use of the POA. That does not mean that such transactions are automatically void or voidable by the principal, but the burden falls on the fiduciary.

Texas Fiduciary Litigation Lawyer

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