Any relationship shall be deemed confidential, whether arising from nature, created by law, or resulting from contracts, where one party is so situated as to exercise a controlling influence over the will, conduct, and interest of another or where, from a similar relationship of mutual confidence, the law requires the utmost good faith, such as the relationship between partners; principal and agent; guardian or conservator and minor or ward; personal representative or temporary administrator and heir, legatee, devisee, or beneficiary; trustee and beneficiary; and similar fiduciary relationships.
(Orig. Code 1863, § 3108; Code 1868, § 3120; Code 1873, § 3177; Code 1882, § 3177; Civil Code 1895, § 4030; Civil Code 1910, § 4627; Code 1933, § 37-707; Ga. L. 2020, p. 377, § 2-26/HB 865.)
Cross references.- Agency generally, T. 10, C. 6.
Confidential relationships for purposes of exclusion of evidence, § 24-5-501 et seq.
Law reviews.- For annual survey article discussing wills, trusts and administration of estates, see 52 Mercer L. Rev. 481 (2000). For article, "Georgia's Law of Undue Influence in Gift-Making," see 5 Ga. St. B.J. 12 (2000). For article, "Common Fact Patterns of Stock Broker Fraud and Misconduct," see 7 Ga. St. B.J. 14 (2002). For survey article on wills, trusts, guardianships, and fiduciary administration for the period from June 1, 2002 to May 31, 2003, see 55 Mercer L. Rev. 459 (2003). For annual survey of law of wills, trusts, guardianships, and fiduciary administration, see 56 Mercer L. Rev. 457 (2004). For survey article on wills, trusts, guardianships, and fiduciary administration, see 59 Mercer L. Rev. 447 (2007). For article, "Holmes v. Grubman: The Supreme Court of Georgia Balances Financial Advisor Common Law Liability and Investor Protection," see 16 (No. 5) Ga. St. B.J. 20 (2011). For article, "What Duty of Care Does a Homeowner Association Owe Its Members?," see 22 Ga. St. Bar J. 19 (Dec. 2016). For note, "The Great Escape: How One Plaintiff's Sidestep of a Mandatory Arbitration Clause Was Applied to a Class in Bickerstaff v. SunTrust Bank," see 68 Mercer L. Rev. 539 (2017).
JUDICIAL DECISIONSANALYSIS
This section is not applicable to confidential relations for the purposes of exclusion of evidence. Guy v. State, 138 Ga. App. 11, 225 S.E.2d 492 (1976).
Because there was no evidence of a confidential relationship between a manufacturer and a broker beyond the contractual obligation for the broker to post bonds on behalf of the manufacturer, and the broker did not act on the manufacturer's behalf in any business transactions and was obligated only to secure the posting of the needed bonds, it was nothing more than an arms-length transaction, and the trial court's charge to the jury on agency and fiduciary relationships was error. Aon Risk Servs. v. Commercial & Military Sys. Co., 270 Ga. App. 510, 607 S.E.2d 157 (2004).
Confidential relationship distinguished from trade secret.- An item may be considered confidential in the context of a business relationship without rising to the level of a trade secret. A confidential relationship is distinguished by the expectations of the parties involved, while a secret is identified through rigorous examination of the information sought to be protected. Roboserve, Ltd. v. Tom's Foods, Inc., 931 F.2d 789 (11th Cir. 1991).
There is never a presumption of confidential relationship. The burden is upon the party asserting the relationship to establish its existence. United States ex rel. Meva Corp. v. Northeast Constr. Co., 298 F. Supp. 1135 (S.D. Ga. 1969); Anderson Chem. Co. v. Portals Water Treatment, Inc., 768 F. Supp. 1568 (M.D. Ga. 1991), aff'd in part, rev'd in part, 971 F.2d 756 (11th Cir. 1992).
A confidential relationship does not exist prior to the contract or legal relationship creating it, unless it exists for other reasons. Cole v. Cates, 113 Ga. App. 540, 149 S.E.2d 165 (1966).
Whether or not the confidential relationship of partners applies to transactions outside of the scope of the partnership, it does not apply where it appears that the partnership was not in existence at the time of the transaction under consideration. Hancock v. Gunter, 195 Ga. 646, 24 S.E.2d 772 (1943).
Fiduciary relationship must exist.
- In order for this O.C.G.A. § 23-2-58 to be applicable, a definite fiduciary relationship must exist between plaintiff and the other party. Anderson Chem. Co. v. Portals Water Treatment, Inc., 768 F. Supp. 1568 (M.D. Ga. 1991), aff'd in part, rev'd in part, 971 F.2d 756 (11th Cir. 1992).
Summary judgment was properly granted to the defendants on the plaintiff's breach of fiduciary duties in a partnership venture claim because the plaintiff never argued during the summary judgment phase that a confidential relationship existed between the parties as partners. Laymac v. Kushner, 349 Ga. App. 727, 824 S.E.2d 768 (2019), cert. denied, No. S19C1091, 2019 Ga. LEXIS 871 (Ga. 2019).
Aiding and abetting breach of fiduciary duty.- Georgia law does not recognize the tort of aiding and abetting a breach of fiduciary duty, and a Georgia court faced with the issue would not be likely to create such a cause of action since the imposition of aider and abettor liability for such breaches essentially extends fiduciary obligations beyond the scope of the confidential or special relationship upon which these duties are based. Munford, Inc. v. Munford, 188 Bankr. 860 (N.D. Ga. 1994), aff'd, 97 F.3d 449 (11th Cir. 1996), 97 F.3d 456 (11th Cir. 1996), aff'd on other grounds, 98 F.3d 604 (11th Cir. 1996).
Party to confidential relationship may rely upon representations of other party.
- The reason for the rule that a party to a confidential or fiduciary relationship may rely upon representations made is that by the very terms or circumstances of the arrangement of dealings between the parties there rests upon the party acting for another the duty of protecting and furthering the interests of the person for whom he is acting, not those of himself or of any one else. The person so placing trust in him by virtue of this confidential relationship is justified by the situation of this interest in believing that the other party will act fairly and make true representations. Dover v. Burns, 186 Ga. 19, 196 S.E. 785 (1938).
Required degree of care to detect fraud is much less when there is a confidential relationship between two parties than in cases when parties deal at arm's length. United States ex rel. Meva Corp. v. Northeast Constr. Co., 298 F. Supp. 1135 (S.D. Ga. 1969).
Failure to protect confidential information.
- Dismissal of the plaintiff's cause of action against a state agency for disclosure of private information for failure to state a cause of action was affirmed because in alleging that the plaintiff gave the agency personal information as a prerequisite to receiving services, with the expectation that it would protect the plaintiff's information, the plaintiff failed to assert in the complaint facts showing that the agency owed the plaintiff a confidential duty to protect that information. McConnell v. Department of Labor, 337 Ga. App. 457, 787 S.E.2d 794 (2016).
Ordinary diligence not required when confidential relationship exists.
- The numerous decisions to the effect that a party who can read must read, and that fraud which will relieve a party who can read must be such as prevents the party from reading, apply to situations where the parties are dealing with each other at arms length, and have no application to a situation where the confidential and fiduciary relation of principal and agent is involved. Harrison v. Harrison, 214 Ga. 393, 105 S.E.2d 214 (1958); Allen v. Sanders, 176 Ga. App. 647, 337 S.E.2d 428 (1985).
Bankruptcy.
- O.C.G.A. § 23-2-58 does not create the kind of trust necessary to create a fiduciary relationship under the federal bankruptcy law. Blashke v. Standard, 123 Bankr. 444 (Bankr. N.D. Ga. 1991).
Cited in Boyles v. Morgan, 168 Ga. 804, 149 S.E. 149 (1929); White v. Dotson, 41 Ga. App. 436, 153 S.E. 233 (1930); Herrington v. Herrington, 42 Ga. App. 126, 155 S.E. 51 (1930); Allen v. Southern Ins. Sec. Corp., 54 Ga. App. 316, 187 S.E. 714 (1936); Blount v. Dean, 187 Ga. 494, 1 S.E.2d 653 (1939); Armour v. Lunsford, 192 Ga. 598, 15 S.E.2d 886 (1941); Manning v. Wills, 193 Ga. 82, 17 S.E.2d 261 (1941); Dorsey v. Green, 204 Ga. 453, 49 S.E.2d 901 (1948); Larkins v. Boyd, 205 Ga. 69, 52 S.E.2d 307 (1949); Hogg v. Hogg, 206 Ga. 691, 58 S.E.2d 403 (1950); Childs v. Shepard, 213 Ga. 381, 99 S.E.2d 129 (1957); Dixie Belle Mills, Inc. v. Specialty Mach. Co., 217 Ga. 104, 120 S.E.2d 771 (1961); Johnson v. Hutchinson, 217 Ga. 489, 123 S.E.2d 551 (1962); Rushing v. Bashlor, 219 Ga. 119, 131 S.E.2d 775 (1963); Brogdon v. Purvis, 220 Ga. 28, 136 S.E.2d 719 (1964); Fuller v. Dillon, 220 Ga. 36, 136 S.E.2d 733 (1964); Weddle v. Webb, 224 Ga. 674, 164 S.E.2d 129 (1968); Bloodworth v. Bloodworth, 224 Ga. 717, 164 S.E.2d 823 (1968); Parker v. Spurlin, 227 Ga. 183, 179 S.E.2d 251 (1971); Tingle v. Harvill, 228 Ga. 332, 185 S.E.2d 539 (1971); Davis v. Carpenter, 157 Ga. App. 875, 278 S.E.2d 758 (1981); McDaniel v. Dykes, 159 Ga. App. 514, 284 S.E.2d 30 (1981); Giordano v. Federal Land Bank, 163 Ga. App. 390, 294 S.E.2d 634 (1982); Pope v. Kem Mfg. Corp., 249 Ga. 868, 295 S.E.2d 290 (1982); Westminster Properties, Inc. v. Atlanta Assocs., 250 Ga. 841, 301 S.E.2d 636 (1983); Schwartz v. Rennie, 185 Ga. App. 638, 365 S.E.2d 159 (1988); Kienel v. Lanier, 190 Ga. App. 201, 378 S.E.2d 359 (1989); Gale v. Hayes Microcomputer Prods., Inc., 192 Ga. App. 30, 383 S.E.2d 590 (1989); Arford v. Blalock, 199 Ga. App. 434, 405 S.E.2d 698 (1991); Wilensky v. Blalock, 262 Ga. 95, 414 S.E.2d 1 (1992); Saffar v. Chrysler First Bus. Credit Corp., 215 Ga. App. 239, 450 S.E.2d 267 (1994); Ledbetter v. Ledbetter, 222 Ga. App. 858, 476 S.E.2d 626 (1996); Longino v. Bank of Ellijay, 228 Ga. App. 37, 491 S.E.2d 81 (1997); Parello v. Maio, 268 Ga. 852, 494 S.E.2d 331 (1998); Conner v. Hart, 252 Ga. App. 92, 555 S.E.2d 783 (2001); Duncan v. Moore, 275 Ga. 656, 571 S.E.2d 771 (2002); Douglas v. Bigley, 278 Ga. App. 117, 628 S.E.2d 199 (2006); Hendry v. Wells, 286 Ga. App. 774, 650 S.E.2d 338 (2007); Saye v. Unumprovident Corp., F. Supp. 2d (N.D. Ga. Aug. 9, 2007).
Confidential Relations Generally
1. In General
This section does not attempt to comprehensively enumerate the cases wherein the relation of mutual confidence is present. The showing of a relationship in fact which justifies the reposing of confidence by one party in another is all the law requires. Cochran v. Murrah, 235 Ga. 304, 219 S.E.2d 421 (1975); Vitner v. Funk, 182 Ga. App. 39, 354 S.E.2d 666 (1987).
The relationships listed as examples in this section are not exclusive, as shown by the use of the abbreviation "etc." and the phrase "where one party is so situated . . ." Cochran v. Murrah, 235 Ga. 304, 219 S.E.2d 421 (1975).
This section goes beyond the strict fiduciary relations of the parties to the particular circumstances of the case. Cochran v. Murrah, 235 Ga. 304, 219 S.E.2d 421 (1975).
Although some confidential relationships are created by law and contract (e.g., partners), others may be created by the facts of the particular case. Cochran v. Murrah, 235 Ga. 304, 219 S.E.2d 421 (1975).
In addition to partners and principals and agents, it has been held that confidential relationships may exist between husband and wife, brother and sister, and even banks and creditors of a depositor. Cochran v. Murrah, 235 Ga. 304, 219 S.E.2d 421 (1975).
The mere fact that one reposes trust and confidence in another does not create a confidential relationship. See Thomas v. Eason, 208 Ga. 822, 69 S.E.2d 729 (1952); Lewis v. Alderman, 117 Ga. App. 855, 162 S.E.2d 440 (1968); United States ex rel. Meva Corp. v. Northeast Constr. Co., 298 F. Supp. 1135 (S.D. Ga. 1969); Anderson Chem. Co. v. Portals Water Treatment, Inc., 768 F. Supp. 1568 (M.D. Ga. 1991), aff'd in part, rev'd in part, 971 F.2d 756 (11th Cir. 1992); Bowen v. Hunter, Maclean, Exley & Dunn, 241 Ga. App. 204, 525 S.E.2d 744 (1999); Burgess v. Coca-Cola Co., 245 Ga. App. 206, 536 S.E.2d 764 (2000).
The fact that an unlearned and uneducated person reposes trust and confidence in another does not create a confidential relationship. Clinton v. State Farm Mut. Auto. Ins. Co., 110 Ga. App. 417, 138 S.E.2d 687 (1964).
The mere fact that the defendant had confidence in the party with whom one contracted does not constitute a confidential relationship or a "similar relationship of mutual confidence" within the meaning of former Code 1933, § 37-707 (see O.C.G.A. § 23-2-58) so as to require the application of former Code 1933, § 37-708 (see O.C.G.A. § 23-2-59). Cole v. Cates, 113 Ga. App. 540, 149 S.E.2d 165 (1966).
No confidential relationship created.
- The fact that it is alleged that a plaintiff reposed trust and confidence in the defendant does not create a confidential relationship. In the majority of business dealings opposite parties have trust and confidence in each other's integrity, but there is no confidential relationship by this alone. This state of facts does not bring the plaintiff within the protection of this section. Dover v. Burns, 186 Ga. 19, 196 S.E. 785 (1938).
Allegation that defendant was a frequent visitor in the plaintiff's home and that he had been a close personal, confidential and business adviser to the plaintiff did not establish the existence of a confidential relationship between them within the meaning of this section. Charles v. Simmons, 215 Ga. 794, 113 S.E.2d 604, cert. denied, 364 U.S. 871, 81 S. Ct. 113, 5 L. Ed. 2d 93 (1960).
Although the plaintiffs offered evidence demonstrating that defendant was their personal friend and had conducted business with them on matters not relating to investments, this evidence is not sufficient to establish a confidential relationship between the parties so as to justify the plaintiffs reposing trust in defendant. Garland v. Advance Med. Funding L.P., 86 F. Supp. 2d 1195 (N.D. Ga. 2000).
Statements made by a corporate officer and owner to investors of a mortgage company that the officer would be obligated on each and every loan and would personally manage their money and be involved with the management of the company did not create a confidential relationship; additionally, the investors had their own financial advisor. Albee v. Krasnoff, 255 Ga. App. 738, 566 S.E.2d 455 (2002).
Factual question as to whether confidential relationship existed.
- Trial court did not err in denying the motion for summary judgment filed by a corporation's general counsel/vice-president because questions of fact existed regarding the existence of a confidential relationship between the general counsel/vice-president and the investors, which were for a jury to decide. Cushing v. Cohen, 323 Ga. App. 497, 746 S.E.2d 898 (2013).
Existence or reliance on relationship issue for jury.
- Whether a confidential relationship existed between plaintiff and his employer's agents, and whether plaintiff justifiably relied on representations regarding group insurance coverage, were questions for the jury. Capriulo v. Bankers Life Co., 178 Ga. App. 635, 344 S.E.2d 430 (1986).
A confidential relationship is distinguished by the expectations of the parties involved, while a trade secret is identified through rigorous examination of the information sought to be protected. The jury is empowered to decide whether a confidential relationship exists under the facts of a particular case. Roboserve, Ltd. v. Tom's Foods, Inc., 940 F.2d 1441 (11th Cir. 1991).
2. Specific Relationships
Attorney-client relationship.
- There was insufficient evidence to establish that the attorney for the purchaser of land was also the attorney for the sellers during the time of the transactions at issue. McLendon v. Georgia Kaolin Co., 782 F. Supp. 1548 (M.D. Ga. 1992).
Trial court erred in granting summary judgment with respect to a client's breach of fiduciary duty claim, which was not a mere duplication of the legal malpractice claim that was based on the establishment of a fiduciary, attorney-client relationship that was breached, as: (1) material fact issues remained as to whether an attorney-client relationship existed between the client and the attorney; (2) the question of legal malpractice remained an issue; and (3) the client had the right to plead alternative theories, and the jury should be permitted to decide the breach of fiduciary duty claim should they find no attorney-client relationship existed. Both v. Frantz, 278 Ga. App. 556, 629 S.E.2d 427 (2006).
Creditors' 11 U.S.C. § 523(a)(4) claim against a Chapter 13 debtor, their attorney, was dismissed for failure to state a claim, as the creditors failed to allege a contract or other agreement establishing a technical trust, but instead cited O.C.G.A. § 23-2-58, which the court held did not establish fiduciary capacity, as the statute did not designate trust property or impose trust duties. Further, none of the Georgia Rules of Professional Conduct cited by the creditors, Ga. St. Bar R. 4-102(d):1.1, 1.3, 1.6, and 1.7(a), mentioned trust property and, thus, those rules were ineffective to establish fiduciary capacity for purposes of 11 U.S.C. § 523(a)(4). Crisler v. Farr (In re Farr), Bankr. (Bankr. M.D. Ga. May 18, 2011).
Attorney breached fiduciary duties to a bankruptcy debtor since the debtor's reliance on the attorney as a family attorney and the attorney's controlling influence over the debtor established an attorney-client relationship with regard to a real property transaction, and the attorney induced the debtor to execute documents which were not in the debtor's best interests and instead benefitted the attorney and other parties. Boudreaux v. Holloway (In re Holloway), Bankr. (Bankr. S.D. Ga. Mar. 31, 2015), aff'd, 2017 U.S. App. LEXIS 3359 (11th Cir. Ga. 2017).
Accountant and client.
- When a company sued its accountants for breach of fiduciary duty regarding a sale of the company's assets, summary judgment was properly granted in favor of the accountants because the evidence was insufficient to create a factual dispute as to whether the accountants exercised a controlling influence over the will, conduct, and interest of the company, as required under O.C.G.A. § 23-2-58 for a fiduciary relationship to arise. R.W. Holdco, Inc. v. Johnson, 267 Ga. App. 859, 601 S.E.2d 177 (2004).
Bank and its customers.
- There is no confidential relationship between a bank and its customers merely because the customer had advised with, relied upon, and trusted the bankers in the past. Pardue v. Bankers First Fed. Sav. & Loan Ass'n, 175 Ga. App. 814, 334 S.E.2d 926 (1985); Russell v. Barnett Banks, Inc., 241 Ga. App. 672, 527 S.E.2d 25 (1999).
The trial court correctly determined that there was no evidence of special circumstances imposing upon the bank the duties of a fiduciary in favor of borrowing petroleum companies such that summary judgment as to any claim for breach of fiduciary duty was correct. Russell Corp. v. BancBoston Fin. Co., 209 Ga. App. 660, 434 S.E.2d 716 (1993).
Trial court did not err in granting judgment on the pleadings to a bank as to a customer's claim for breach of a duty of confidentiality because the customer failed to assert in the complaint facts showing that the bank owed the customer a confidential duty or invaded the customer's privacy, and the customer did not plead any special circumstances showing that the customer had a particular relationship of trust or mutual confidence with the bank; the bank-customer relationship is not confidential. Jenkins v. Wachovia Bank, N.A., 314 Ga. App. 257, 724 S.E.2d 1 (2012).
Businessmen.
- In the majority of business dealings, opposite parties have trust and confidence in each other's integrity, but there is no confidential relationship by this alone. Lewis v. Alderman, 117 Ga. App. 855, 162 S.E.2d 440 (1968).
A confidential relationship may exist between businessmen, depending on the facts. Cochran v. Murrah, 235 Ga. 304, 219 S.E.2d 421 (1975).
The entire business structure of the parties, their interactions and dealings over the course of several years, and their common goal all furnished a basis for a jury to find a relationship in fact which justified the reposal of confidence on the part of one party and good faith on the part of the others. Vitner v. Funk, 182 Ga. App. 39, 354 S.E.2d 666 (1987).
Facts would not support finding a confidential relationship between real estate developers and a supermarket regarding their shared goal of finding a site and constructing a shopping center in which the supermarket would lease space, where the parties fought over the terms of the lease agreement for approximately six months. Doll v. Grand Union Co., 925 F.2d 1363 (11th Cir. 1991).
Relationship between the parties, close and lengthy as it might have been, was merely a business relationship between two independent concerns; therefore, no fiduciary duties were created. Automated Solutions Enters. v. Clearview Software, Inc., 255 Ga. App. 884, 567 S.E.2d 335 (2002).
Parties' merger agreement and post-merger relationship did not establish a confidential or fiduciary relationship between the parties since the plaintiff did not exercise sole and exclusive control over the termination of a lease held by the defendant; also, the mere fact that the plaintiff's signature was required on instructions to the escrow agent for the release of escrow funds did not establish a confidential relationship. Interland, Inc. v. Bunting, F. Supp. 2d (N.D. Ga. Mar. 31, 2005).
Evidence that an appellant breached an agreement with the appellee; was unjustly enriched by keeping the profits of the parties' business during the months the appellee was entitled to operate it; and committed civil conspiracy when, in concert with the parties' lessor, prevented the appellee from operating the business, supported an award of lost profit damages to the appellee. Asgharneya v. Hadavi, 298 Ga. App. 693, 680 S.E.2d 866 (2009), overruled on other grounds, Jordan v. Moses, 291 Ga. 39, 727 S.E.2d 460 (2012).
Genuine issues of fact existed as to whether fiduciary duty owed between business people.
- Trial court erred by granting summary judgment to the defendants on the part owner's claim for breach of contract because there were genuine questions of fact regarding whether the defendants owed the part owner a fiduciary duty, whether the defendants breached the duty, and whether any breach proximately caused the part owner damage. Bedsole v. Action Outdoor Adver. JV, LLC, 325 Ga. App. 194, 750 S.E.2d 445 (2013).
Business relationship.
- Trial court erred by denying summary judgment to a subcontractor on the contractor's breach of fiduciary claim because the evidence did not raise an issue of fact regarding the existence of a special agency or any other confidential relationship between the parties as the business relationship was an arms-length one and even adversarial. UWork.com, Inc. v. Paragon Techs., Inc., 321 Ga. App. 584, 740 S.E.2d 887 (2013).
Members of a partnership or an LLC undoubtedly shared a special relationship under Georgia law, but the fiduciary relationship addressed in the Bankruptcy Code exception to discharge had to be demonstrated by evidence of an express trust. Keys v. Allen (In re Allen), Bankr. (Bankr. N.D. Ga. Oct. 25, 2013).
Managing and non-managing members of LLC.
- In a suit arising out of the winding up of an LLC, neither res judicata nor collateral estoppel barred the non-managing member's breach of contract and fiduciary duty counterclaims involving the sale of the LLC property based on a prior suit between the same parties because the current claims related to conduct occurring after the first trial. Eichenblatt v. Piedmont/Maple, LLC, 341 Ga. App. 761, 801 S.E.2d 616 (2017).
Manager of joint venture.
- Trial court did not err in denying a manager's motion for summary judgment as to the joint venturers' counterclaim for breach of fiduciary duty because questions of fact existed regarding whether the manager exercised good faith by depleting the business funds and suspending distributions. Maree v. ROMAR Joint Venture, 329 Ga. App. 282, 763 S.E.2d 899 (2014), overruled on other grounds by SRM Group, Inc. v. Travelers Prop. Cas. Co. of Am., 308 Ga. 404, 841 S.E.2d 729 (2020).
Clergyman and parishioner.
- It can be found that a clergyman occupies a confidential relationship toward a member of his church. Bryan v. Norton, 245 Ga. 347, 265 S.E.2d 282 (1980).
Whether a wife consented to the sexual relationship would be irrelevant when the bishop was, by virtue of the bishop's confidential relationship, in a position to manipulate the wife into giving that consent by not only being a bishop but also the wife's employer. Brewer v. Paulk, 296 Ga. App. 26, 673 S.E.2d 545 (2009).
Employer and employee.
- Employee and employer is not the type of relationship such as that of principal and agent from which the law will necessarily imply confidentiality. Cochran v. Murrah, 235 Ga. 304, 219 S.E.2d 421 (1975).
Even though generally the relationship between an employer and employee is that of arms length bargaining, this is not to say, however, that under a particular fact situation a confidential relationship can never exist between an employer and his employee (e.g., an employer signing checks prepared by his secretary-bookkeeper). Cochran v. Murrah, 235 Ga. 304, 219 S.E.2d 421 (1975).
When assurances between a real estate broker and his former real estate director, an at-will employee, would not have been made but for the prior employer-employee relationship, and because they were not made while the relationship existed, the assurances did not cause the employer and employee relationship to evolve into a fiduciary relationship. Atlanta Mkt. Ctr. Mgt. Co. v. McLane, 269 Ga. 604, 503 S.E.2d 278 (1998).
When there was no evidence showing that employees could create obligations on behalf of their employer or bring third parties into contractual relations with it, they were not agents owing a fiduciary duty to the employer. Physician Specialists in Anesthesia, P.C. v. Wildmon, 238 Ga. App. 730, 521 S.E.2d 358 (1999).
Evidence that a former executive officer of a product development company, while still employed, pursued opportunities in the same market for the officer's own benefit, to the company's detriment, and appropriated a presentation and its information, showed a triable issue as to a confidential relationship under O.C.G.A. § 23-2-58. Glades Pharms., LLC v. Murphy, F. Supp. 2d (N.D. Ga. Dec. 16, 2005).
There is little question that a former employee's relationship with the employer was one which required confidence under O.C.G.A. § 23-2-58. The undisputed evidence showed that the employee was intimately involved in the negotiations leading up to and the continuous administration of the contracts with a contractor; not only was the employee responsible for bringing the contractor to the employer, the employee was charged with supervision and inspection of the contractor's contract work. GIW Indus. v. JerPeg Contr., Inc., 530 F. Supp. 2d 1323 (S.D. Ga. 2008).
On a breach of fiduciary duty claim against a former employee concerning the employee's alleged solicitation of the employee's co-workers, the trial court did not err in granting summary judgment in favor of the employee because, even assuming that the employee had the authority to bind the employer with respect to customer contracts, there was no evidence that the employee had the authority to bind the company on employment matters or relations. Thus, although the employee may have owed the company a fiduciary duty with respect to the customer contracts the employee entered into on its behalf, there was no evidence that the employee occupied a similar confidential relationship with respect to employee relations. Gordon Document Prods. v. Serv. Techs., 308 Ga. App. 445, 708 S.E.2d 48 (2011).
Trial court properly denied a personal assistant's motion for a directed verdict on a couple's claim for breach of fiduciary duty based upon the assistant's withdrawal of $49,000 remaining in a joint account held with the wife because there was evidence that the assistant was not entitled to any portion of that account since the assistant was a fiduciary only. Lee v. Choi, 323 Ga. App. 370, 744 S.E.2d 871 (2013).
Because the employer failed to point out specific evidence giving rise to a triable issue as to the former employee's status as an agent owing a fiduciary duty to the principal, the employer failed to show error in the trial court's grant of summary judgment to the employee on the employer's claim for breach of fiduciary duty. Avion Sys. v. Bellomo, 338 Ga. App. 141, 789 S.E.2d 374 (2016).
Evidence was insufficient to convict the defendant of criminal attempt to commit theft by taking by a fiduciary as the relationship between the defendant and the employer was merely that of employer-employee because, although the defendant was responsible for creating invoices, the defendant did not have authority to act for the employer beyond weighing the metals and assigning to the weight a dollar amount that had been previously fixed by the employer; and the defendant could not negotiate with the customers or independently determine how much the metals were worth; thus, although the conviction for criminal attempt to commit theft by taking stood, the felony sentence, based on the defendant being a fiduciary, was reversed. Scott v. State, 344 Ga. App. 412, 810 S.E.2d 613 (2018).
Employee benefit plan claims administrator and utilization review provider.
- No fiduciary duty existed between a participant in an employee benefit health plan and the claims administrator for the plan or an independent plan medical utilization review provider; therefore, the participant could not assert a claim for breach of fiduciary duty against the claims administrator or the review provider. Monroe v. Bd. of Regents of the Univ. Sys., 268 Ga. App. 659, 602 S.E.2d 219 (2004).
Executor and legatee.
- The relation between an executor and the devisees under a will is to a certain extent a relation of confidence and trust. Dorsey v. Green, 202 Ga. 655, 44 S.E.2d 377 (1947), later appeal, 204 Ga. 436, 49 S.E.2d 901 (1948).
The policy of the law forbids that administrators, executors, or trustees, having duties to perform in reference to property for their cestuis que trust, should deal with the beneficiaries with respect thereto, except upon the footing of the utmost candor and upon considerations demonstrative of the absence of any undue advantage. Dorsey v. Green, 202 Ga. 655, 44 S.E.2d 377 (1947), later appeal, 204 Ga. 436, 49 S.E.2d 901 (1948).
An executor cannot purchase property from himself, directly or indirectly, and if he does so the sale will be set aside at the instance of a legatee who is not in laches, however fair and honest it may have been. He may, however, purchase the property from a legatee who is sui juris and laboring under no disability, where all the circumstances of the transaction are fair and open, and no advantage is taken by him of the legatee by concealment, misrepresentation, or omission to state any important fact, or by the exercise or undue influence, and the legatee understands the nature and effect of his act. Dorsey v. Green, 202 Ga. 655, 44 S.E.2d 377 (1947), later appeal, 204 Ga. 436, 49 S.E.2d 901 (1948).
A court of equity looks upon the purchase of estate property by the executor from a legatee with jealous eye, and will not uphold it, unless it appears that the sale is fair, and that there is no fraud, no concealment, and no advantage taken by the executor of information acquired by him in his character as such. Dorsey v. Green, 202 Ga. 655, 44 S.E.2d 377 (1947), later appeal, 204 Ga. 436, 49 S.E.2d 901 (1948).
Business did not have a confidential relationship with a corporation where the parties had similar but separate business objectives that did not merge into a common business objective; the business's insistence on status as a platform company was inconsistent with a confidential relationship because a bid prepared by the business with another company was not evidence of such a relationship, even though the corporation's president was an officer in the other company, as there was no showing that the corporate entities should be disregarded. Infrasource, Inc. v. Hahn Yalena Corp., 272 Ga. App. 703, 613 S.E.2d 144 (2005).
Trial court properly denied the motions for a directed verdict and for a judgment notwithstanding the verdict filed by the executors of a will and trust because there was sufficient evidence to support the jury's finding that the documents were invalid as a product of undue influence based on the executors taking complete control of the elderly testator and isolating the testator from the testator's sons, as well as substituting the executors' desires and having the testator sign a new will and trust, which benefitted the executors and excluded the testator's wife and sons. Davison v. Hines, 291 Ga. 434, 729 S.E.2d 330 (2012).
Friendship.
- That the defendant was or had been a friend of the plaintiff would not alone create a relation of trust or confidence between them. Norris v. Hart, 74 Ga. App. 444, 40 S.E.2d 96 (1946).
Evidence was sufficient to support a jury's finding that there was a confidential relationship pursuant to O.C.G.A. § 23-2-58 between an attorney, who was dying of leukemia, and the attorney's former client and friend, from whom the attorney sought to borrow money on the attorney's life insurance policy. Stamps v. JFB Props., LLC, 287 Ga. 124, 694 S.E.2d 649 (2010).
Lender's claims against borrowers for discharge of documents the lender signed without reading, which discharged a $1.2 million note and released the lender's security interest in the borrowers' property, were subject to summary judgment. The lender's close, personal friendship with the borrowers did not create a confidential relationship under O.C.G.A. § 23-2-58 and did not excuse the lender's failure to read the documents. Arko v. Cirou, 305 Ga. App. 790, 700 S.E.2d 604 (2010).
Boyfriend and girlfriend.
- The trial court did not err in denying a boyfriend a directed verdict on a fraud in the inducement claim asserted by the boyfriend's girlfriend, given evidence of the personal nature of their relationship which caused the girlfriend to place trust and confidence in the boyfriend's repeated promises of marriage and believe that the boyfriend was acting in the girlfriend's best interest by taking the monies loaned to use for a business, which would ultimately allow the boyfriend to repay the girlfriend and support them after they were married. Tankersley v. Barker, 286 Ga. App. 788, 651 S.E.2d 435 (2007), cert. denied, No. S07C1821, 2007 Ga. LEXIS 742 (Ga. 2007).
Husband and wife.- It is plain that under Georgia law a confidential relationship exists between husband and wife. ITT Com. Fin. Corp. v. Dilkes (In re Analytical Sys.), 113 Bankr. 91 (N.D. Ga. 1990), rev'd on other grounds, 933 F.2d 939 (11th Cir. 1991).
Wife's personal injury action against her husband arising from the husband's infection of the wife with genital herpes was not barred by statute of limitations; the parties enjoyed a confidential relationship pursuant to O.C.G.A. § 23-2-58, and thus, the wife was entitled to repose confidence and trust in the husband, and because the husband failed to admit the truth to the wife, he was guilty of a false representation and that falsehood deterred the wife from instituting suit and tolled the statute of limitation. Beller v. Tilbrook, 275 Ga. 762, 571 S.E.2d 735 (2002).
Wife could not claim that she had a confidential relationship with her husband when she signed a prenuptial agreement, thereby relieving the wife of any obligation to verify the agreement's representations, because when the wife signed the agreement they were not married, so the confidential relationship applicable to husbands and wives did not exist and, under Georgia law, there was no such relationship applicable to putative spouses. Mallen v. Mallen, 280 Ga. 43, 622 S.E.2d 812 (2005).
Husband, his father, and the father's friend were not entitled to summary judgment in an action by the Securities Exchange Commission against them for insider trading under 17 C.F.R. § 240.10b-5 because a reasonable factfinder could conclude that the husband violated a fiduciary duty to his wife under O.C.G.A. § 23-2-58 by disclosing information about the wife's employer, leading to his father and the friend purchasing stock options in the wife's employer on the basis of material, non-public information. United States SEC v. Goodson, F. Supp. 2d (N.D. Ga. Mar. 6, 2001).
After the husband engaged counsel to draw up a formal post-nuptial agreement, and the husband moved to enforce the agreement when the wife filed for divorce, the post-nuptial agreement was unenforceable as the wife testified that the wife signed the agreement because the husband represented to the wife that, if the wife signed the agreement, the husband would understand that the wife loved the husband, and the husband would tear up the agreement; the husband procured the wife's signature on the agreement under the pretense that the agreement would never be enforced and, in fact, that the agreement would be destroyed, and the evidence was sufficient to establish the existence of fraud in procuring the agreement. Murray v. Murray, 299 Ga. 703, 791 S.E.2d 816 (2016).
Paramours.
- As to a breach of fiduciary duty claim in a defamation suit, one of the defendants, by virtue merely of the status as a paramour of the plaintiff, owed no fiduciary duty to the plaintiff and, thus, the breach of fiduciary claim failed. Bickerstaff v. SunTrust Bank, 299 Ga. 459, 788 S.E.2d 787 (2016), cert. denied, 137 S. Ct. 571, 196 L. Ed. 2d 447 (U.S. 2016).
Insurance agent and non-insured.
- Summary judgment was properly awarded the insurer with respect to a fraud claim where the record was devoid of any evidence from which to conclude that a confidential relationship existed between insurance agent and plaintiff who was neither a party to the insurance contract, a named insured, nor an owner of the vehicle. Clark v. Superior Ins. Co., 209 Ga. App. 290, 433 S.E.2d 394 (1993).
Insurance agent and insured.
- When an insured sued an insurance agent for fraud and breach of fiduciary duty because the agent allegedly misrepresented the coverage afforded by a policy the insured purchased through the agent, the insured did not show the presence of a confidential relationship with the agent which would have negated the insured's duty to read the policy the insured purchased because: (1) the insured knew what kind of insurance coverage the insured wanted when approaching the agent, so the insured did not rely on the agent's expertise to obtain the correct insurance; and (2) the insured's past dealings with and trust in the agent did not create a confidential relationship. Canales v. Wilson Southland Ins. Agency, 261 Ga. App. 529, 583 S.E.2d 203 (2003).
Wife and agent.- Defendant, as decedent's wife and agent under the power of attorney, enjoyed a relationship with decedent which was both confidential and fiduciary in nature. Wheeless v. Gelzer, 780 F. Supp. 1373 (N.D. Ga. 1991).
Lender and borrower.
- There is no confidential relationship between lender and borrower for they are creditor and debtor with clearly opposite interests. Pardue v. Bankers First Fed. Sav. & Loan Ass'n, 175 Ga. App. 814, 334 S.E.2d 926 (1985).
Mortgagee and mortgagor.
- There is no confidential relationship between mortgagee and mortgagor for they are creditor and debtor with clearly opposite interests. Pardue v. Bankers First Fed. Sav. & Loan Ass'n, 175 Ga. App. 814, 334 S.E.2d 926 (1985).
Mortgage companies were not liable for a breach of fiduciary duty to real estate investors whose credit scores allegedly were injured after the companies' failure to timely pay a tax bill triggered the filing of a county tax lien and after they erroneously reported having foreclosed a mortgage granted to the investors because the investors failed to show the existence of a confidential relationship between the parties within the meaning of O.C.G.A. § 23-2-58. Burch v. Chase Manhattan Mortg. Corp., F. Supp. 2d (N.D. Ga. Sept. 15, 2008).
Homeowner sufficiently alleged a claim for breach of contract against the homeowner's mortgage lender based on a promise in the security agreement that the lender would foreclose "fairly" while acting as the owner's agent; the homeowner was not required to perform the homeowner's obligation of payment because the lender's obligations as to reinstatement and foreclosure were triggered by the failure to pay. Stewart v. SunTrust Mortg., Inc., 331 Ga. App. 635, 770 S.E.2d 892 (2015).
Hospital and patient.
- In an action between a group of uninsured patients and a non-profit hospital in which the patients alleged, among other things, a breach of fiduciary duty, absent authority recognizing a fiduciary relationship between a hospital and a patient with respect to the prices the hospital charged, said claim was properly dismissed. Cox v. Athens Reg'l Med. Ctr., Inc., 279 Ga. App. 586, 631 S.E.2d 792 (2006).
Hospital and doctors.
- In a suit by doctors against a hospital where they had served as anesthesiologists alleging that the hospital's failure to rehire the doctors was motivated by malice, summary judgment to the hospital was proper based on peer review immunity under O.C.G.A. § 31-7-132(a); the doctors' claim for breach of fiduciary duty failed because the relationship between the doctors and the hospital was governed by a contract and no fiduciary relationship was shown. Cancel v. Medical Center of Central Ga., Inc., 345 Ga. App. 215, 812 S.E.2d 592 (2018), cert. denied, No. S18C1054, 2018 Ga. LEXIS 769 (Ga. 2018).
Partners.
- Partners stand in a confidential relationship to each other. Crosby v. Rogers, 197 Ga. 616, 30 S.E.2d 248 (1944).
Petitioner was justified in failing to read deed which he signed or to examine the records, and in relying upon the defendant, because of the confidential relationship existing between them as partners, and where suit was brought promptly upon learning of the defendant's breach of faith the petitioner was not estopped by laches although 14 years had passed since the deed attacked was executed. Crosby v. Rogers, 197 Ga. 616, 30 S.E.2d 248 (1944).
Under the evidence as to the existence of a partnership between the petitioner and the defendant and their agreement to jointly purchase the land involved, and evidence that the petitioner paid one-half of the purchase money and trusted the defendant to close the deal and obtain a conveyance naming them both as grantees, the defendant could not obtain an interest in the land antagonistic to that of the petitioner; and where the defendant procured a deed, in his own name only, equity would annul the conveyance and decree title in the petitioner to his share. Crosby v. Rogers, 197 Ga. 616, 30 S.E.2d 248 (1944).
Summary judgment was not appropriate for a guaranty partner's allegations that an investment bank partner, which was also a creditor of the partnership, breached its fiduciary duty towards the guaranty partner by using coercive and deceptive tactics in its efforts to restructure the partnership because a jury question existed as to whether the investment bank partner breached its fiduciary duty owed to the guaranty partner. AAF-McQuay, Inc. v. Willis, 308 Ga. App. 203, 707 S.E.2d 508 (2011).
Court of appeals erred in granting an attorney's motion for summary judgment in the court's action to dissolve a partnership because the court cited disapproved language that the tort of wrongful dissolution of a partnership required the attempt to appropriate the "new prosperity" of the partnership; the gravamen of a wrongful dissolution claim is a partner's attempt to appropriate, through the dissolution, the assets or business of the partnership, which may include prospective business, without adequate compensation to the remaining partners. Jordan v. Moses, 291 Ga. 39, 727 S.E.2d 460 (2012).
Franchisor and franchisee.
- A franchise contract did not create a confidential relationship between the franchisor and franchisee. Allen v. Hub Cap Heaven, Inc., 225 Ga. App. 533, 484 S.E.2d 259 (1997).
Principal and agent.
- Since the relation of principal and agent was established when the owner, listed her property for sale with the realty company, such being a confidential or fiduciary relation, it imposed on the agent the duty of exercising the utmost good faith and loyalty toward the principal. It became the duty of the agent to act primarily and solely for the benefit of the principal in all matters connected with the agency. Dolvin Realty Co. v. Holley, 203 Ga. 618, 48 S.E.2d 109 (1948).
The relationship of principal and agent is fiduciary in character, and imposes upon the parties the duties of exercising toward each other the utmost good faith. Reisman v. Massey, 84 Ga. App. 796, 67 S.E.2d 585 (1951).
The law implies as a part of the contract by which every agency arises that the agent agrees to have and exercise for and toward his principal loyalty and absolute good faith, and any breach of this implied contract on his part forfeits his right to commissions. Reisman v. Massey, 84 Ga. App. 796, 67 S.E.2d 585 (1951).
The relationship of principal and agent, being confidential and fiduciary in character, demands of the agent the utmost loyalty and good faith to his principal. Any breach of this good faith whereby the principal suffers any disadvantage and the agent reaps any benefit is a fraud of such nature as to preclude the agent from taking or retaining the benefit. Harrison v. Harrison, 214 Ga. 393, 105 S.E.2d 214 (1958).
The law implies, as a part of the contract by which every agency arises, that the agent agrees to have and exercise towards his principal diligence, loyalty and absolute good faith. Anderson v. Redwal Music Co., 122 Ga. App. 247, 176 S.E.2d 645 (1970).
Real estate and brokers and clients.
- Whatever may be the reciprocal duties imposed by law on a real estate broker and his principal, the relationship is one of mutual confidence, and the law requires that the broker, in the discharge of his duties, act towards his principal in the utmost good faith. Lyle v. Etheridge, 40 Ga. App. 808, 151 S.E. 531 (1930).
Although a real estate broker, when obtaining for the owner of real estate a tenant for the property, is under no duty, arising out of the relationship to his principal, to guarantee the financial standing of the lessee and the lessee's ability to perform the proposed lease contract, yet where the broker makes a knowingly false representation to his principal, the owner of the property, as to the financial standing of the lessee and the lessee's ability to perform the proposed lease contract, and thereby induces the principal to accept the tenant procured by the broker and to pay to the broker a commission for his services in procuring the tenant, he thereby perpetrates a fraud upon his principal, for which the principal, in a suit against the broker, may recover for the damages sustained. Lyle v. Etheridge, 40 Ga. App. 808, 151 S.E. 531 (1930).
Gifts and purchases of agents scrutinized.
- It is for the common security of mankind "that gifts procured by agents, and purchases made by them, from their principal, should be scrutinized with a close and vigilant suspicion." Harrison v. Harrison, 214 Ga. 393, 105 S.E.2d 214 (1958).
Real estate brokers and clients.
- Answer, alleging that the plaintiff broker misrepresented the financial ability of the buyer, that is, that the buyer was ready, willing and able to buy on the terms stipulated by the seller, thereby inducing the defendant to accept the buyer's offer and to enter into a contract which the buyer was unable to perform, set out a breach of the broker's duty of exercising the utmost good faith toward his principal, the seller, which was a defense to the broker's action for commissions. Reisman v. Massey, 84 Ga. App. 796, 67 S.E.2d 585 (1951).
If the agent practices upon the principal any deception (whether intentional or not) whereby the principal is misled and damaged and the agent would reap any benefit, the transaction is fraudulent, and the courts will not allow the agent to take or retain the benefit. Reisman v. Massey, 84 Ga. App. 796, 67 S.E.2d 585 (1951).
Because of fiduciary relationship, the petitioner was justified in relying upon the representations of her agent and in failing to read and know the contents of the various deeds signed by her. Harrison v. Harrison, 214 Ga. 393, 105 S.E.2d 214 (1958).
When the fiduciary relationship of principal and agent existed between the petitioner and the defendant, the latter could not make advantage or profit for the agent out of the relationship to the injury of one's principal. Harrison v. Harrison, 214 Ga. 393, 105 S.E.2d 214 (1958).
The mere fact that one of the two parties to a contract of sale between them is known to the other to be a real estate broker, when the broker is not acting as the agent for the buyer but is himself the seller of the property, will fail to show a fiduciary relationship. Lewis v. Alderman, 117 Ga. App. 855, 162 S.E.2d 440 (1968).
Fiduciary relationship in insurance transaction.
- Should the jury find that an agency relationship existed between an insurance agent and an insurance applicant, the jury would be required further to treat that relationship as a fiduciary relationship. Stewart v. Boykin, 165 Ga. App. 868, 303 S.E.2d 50 (1983).
An agent can do nothing more disloyal to his principal than contacting his principal's employer and taking over the latter's position with the company. Koch v. Cochran, 251 Ga. 559, 307 S.E.2d 918 (1983).
One of the areas where the law finds a confidential or fiduciary relationship is in the case of principal and agent. Tigner v. Shearson-Lehman Hutton, Inc., 201 Ga. App. 713, 411 S.E.2d 800 (1991).
Fiduciary relationship was created between a brokerage firm and a mentally disabled client, after the firm exercised a "controlling influence" over the client and had accepted one's account with the understanding that one needed complete guidance in the management and handling of one's money. Tigner v. Shearson-Lehman Hutton, Inc., 201 Ga. App. 713, 411 S.E.2d 800 (1991).
When the cotenant was a relative to the other heirs and acted as agent for the purchaser of land during the sale, the agent's confidential relationship with the other heirs was imputed to the purchaser; and a jury could find that the purchaser, through the agent's confidential relationship with the other heirs, was so situated as to exercise a controlling influence over the will, conduct, and interest of the other heirs. McLendon v. Georgia Kaolin Co., 782 F. Supp. 1548 (M.D. Ga. 1992).
Inquiry of manufacturer's customers whether, in the event representative (agent) left the appellant's employment in the future, they would consider continuing to place their orders through him did not result in profit at manufacturer's expense during his actual employment. Nilan's Alley, Inc. v. Ginsburg, 208 Ga. App. 145, 430 S.E.2d 368 (1993).
In a breach of fiduciary duty and fraud action wherein an investment company obtained a jury verdict in the company's favor against a site manager, the manager's spouse, and others, the trial evidence supported the conclusion that a fiduciary relationship arose between the site manager and the investment company as the investment company entrusted significant financial responsibility and authority to the site manager, who engaged in a financial kickback scheme diverting thousands of dollars from the investment company. Wright v. Apt. Inv. & Mgmt. Co., 315 Ga. App. 587, 726 S.E.2d 779 (2012).
An agent cannot place himself in a position in which his duty and interest conflict with that of his principal, or be permitted to make a secret profit out of his agency. Franco v. Stein Steel & Supply Co., 227 Ga. 92, 179 S.E.2d 88 (1970).
Insurance agent and insured.
- A confidential relationship did not exist between an insured and his agent which would have enabled the insured to place trust and reliance on oral representations by the agent, inconsistent with the terms of the form. The mere fact that one reposes trust and confidence in another does not create a confidential relationship. Trulove v. Woodmen of World Life Ins. Soc'y, 204 Ga. App. 362, 419 S.E.2d 324 (1992).
Purchaser of automobile and financer.- Purchaser of automobile has no confidential relationship with the financer of the purchase. Doxie v. Ford Motor Credit Co., 603 F. Supp. 624 (S.D. Ga. 1984).
Relatives.
- A confidential relationship does not exist because of brother and sister-in-law relationship, or because of past dealings and trust and confidence reposed in brother-in-law by sister-in-law and her husband, defendant's brother. Dixon v. Dixon, 211 Ga. 557, 87 S.E.2d 369 (1955).
While the fact that the plaintiff and the decedent were brother and sister would not of itself create a confidential or fiduciary relationship between them solely because they were so related, plaintiff's allegations were sufficient to charge the existence of a confidential relationship between them requiring the utmost good faith and fair dealings on his part. Sutton v. McMillan, 213 Ga. 90, 97 S.E.2d 139 (1957).
The fact that the plaintiff and the defendant are brothers does not of itself create a confidential or fiduciary relation between them. If such relation exists between brothers, it must be shown by proof, and the burden is upon the party asserting the existence of such relationship to affirmatively show the relationship. Hancock v. Hancock, 223 Ga. 481, 156 S.E.2d 354 (1967).
The facts that the bank officer was the brother of plaintiff's daughter-in-law, solicited plaintiff and induced him to place his business with the bank, promised to keep his affairs confidential, and to treat plaintiff right, are insufficient to create a confidential relationship. First Am. Bank v. Bishop, 244 Ga. 317, 260 S.E.2d 49 (1979).
Parent and child.
- In a wrongful death case, the surviving spouse acts as the children's representative and owes them the duty to act prudently in asserting, prosecuting and settling the claim and to act in the utmost good faith. Home Ins. Co. v. Wynn, 229 Ga. App. 220, 493 S.E.2d 622 (1997).
Jury question was presented as to whether two trustees of their children's trusts acted against the interests of the beneficiaries (their children) in bad faith by amending a partnership agreement to concentrate all voting power in themselves to the exclusion of the beneficiaries, who otherwise would have become partners when they turned 45. Likewise, the trustees as partners owed duties to the trusts as partners in the partnership. Rollins v. Rollins, 338 Ga. App. 308, 790 S.E.2d 157 (2016).
Vendor and vendee.
- Under the facts no confidential relationship was shown between wholesale vendor of liquor and purchaser who claimed that vendor had misrepresented the tax status of the liquors purchased. Bernstein v. Peters, 69 Ga. App. 525, 26 S.E.2d 192 (1943).
In a suit by vendor against purchaser for reformation of a deed to land to show reservation of timber, where neither fraud nor the existence of a confidential relationship was alleged or proved, it was reversible error to charge that, if the jury found that the vendor relied on the representations of the purchaser as being true due to a confidential or fiduciary relationship between the parties, and if the vendor was ignorant of the fact that reservation should have been inserted in the deed, purchaser would be guilty of fraud, and that equity will reform instrument when there was ignorance or mistake on one side and fraud or inequitable conduct on the other. Cochran v. Kendall, 210 Ga. 336, 80 S.E.2d 273 (1954).
The vendor and vendee of property are not, by virtue of such fact, placed in a confidential relationship to each other, but on the contrary are presumed to be dealing at arm's length. Lewis v. Alderman, 117 Ga. App. 855, 162 S.E.2d 440 (1968).
Buyer and seller.
- Directed verdict for the seller on the buyers' breach of confidential relationship claim was reversed because there was a fact issue as to whether the seller exercised a controlling influence over the buyers in their application for mobile home permit such that the buyers were kept from discovering zoning for the property or that the seller had an increased duty to disclose the zoning. Howard v. Barron, 272 Ga. App. 360, 612 S.E.2d 569 (2005).
Tenants in common.- Purchaser of land had no duty to disclose its knowledge of a kaolin deposit to seller by virtue of its relationship as a tenant in common, since the confidential relationship between cotenants does not extend to encompass the circumstance of one tenant purchasing another cotenant's interest. McLendon v. Georgia Kaolin Co., 782 F. Supp. 1548 (M.D. Ga. 1992).
Purchaser of property and real estate investing company.
- Since plaintiff's decision to buy property was based on plaintiff's confidence that it could be used in the way defendant suggested and that defendant would rent the property on plaintiff's behalf as defendant agreed to do, a jury issue existed regarding whether the parties were in a confidential relationship at the time of the alleged fraud. Yarbrough v. Kirkland, 249 Ga. App. 523, 548 S.E.2d 670 (2001).
Resident.
- Trial court did not err in granting a homeowners' association summary judgment on a resident's claim of breach of fiduciary duty because the resident's mere reliance upon status as a resident of the development, without more, failed to establish a fiduciary or confidential relationship. Campbell v. Landings Ass'n, 311 Ga. App. 476, 716 S.E.2d 543 (2011).
Mining leases.- Royalty leases for the mining of kaolin were not shown to have been intended to place the parties in a confidential relationship, and the presumption remained that the agreements were entered at arm's length between persons on equal footing. Manning v. Engelhard Corp., 929 F. Supp. 1508 (M.D. Ga. 1996), aff'd, 111 F.3d 897 (11th Cir. 1997).
Investors and bank.
- Breach of fiduciary duty action filed by two investors against a bank was dismissed by summary judgment because, according to the terms of an investment agreement, there was no such relationship between the parties; further, there was no evidence that the bank exercised a controlling influence over the investors' will, conduct, or interests nor did the investors establish that they relied upon the bank to make decisions on their behalf. Newitt v. First Union Nat'l Bank, 270 Ga. App. 538, 607 S.E.2d 188 (2004).
Creditors failed to prove the existence of a technical trust, either by contract or by O.C.G.A. §§ 14-11-301(1),14-11-305(1), or23-2-58, and, as a consequence, could not prove a fiduciary defalcation by the debtors. Thus, any debt arising from the debtors' management of a limited liability company was dischargeable under 11 U.S.C. § 523(a)(4). Tarpon Point, LLC v. Wheelus (In re Wheelus), Bankr. (Bankr. M.D. Ga. Feb. 11, 2008).
Evidence of breach by trustee shown to survive summary judgment.
- In a trustee's suit against a company and the company's manager for interfering with trust assets, the trial court erred by granting summary judgment to the company and the company's manager on the trustee's breach of fiduciary claim because the evidence showed that they unilaterally transferred the trust's property interest and, although the transfer was deemed invalid, the trust's interest was invaded, creating a jury question as to injury and resulting damage, either actual or nominal. Schinazi v. Eden, 338 Ga. App. 793, 792 S.E.2d 94 (2016).
Stockbroker and stockholder.
- In response to a certified question asking whether, under Georgia law, a brokerage firm owed a fiduciary duty to the holder of a non-discretionary account, the supreme court answered that the fiduciary duties owed by a broker to a customer with a non-discretionary account were not restricted to the actual execution of transactions; the broker will generally have a heightened duty, even to the holder of a non-discretionary account, when recommending an investment which the holder has previously rejected or as to which the broker has a conflict of interest. Holmes v. Grubman, 286 Ga. 636, 691 S.E.2d 196 (2010).
Presumption of Undue Influence
Evidence of confidential relationship raises presumption of undue influences.
- While a mere allegation of weakness of mind not amounting to imbecility is not sufficient to set forth a cause of action for cancellation of a deed, there being no allegation of fraud or undue influence, nevertheless, where the mental weakness is pronounced, such as would prevent the grantor from understanding the nature of his act at the time the deed was executed and especially where as alleged such mental impairment is united with alleged undue and controlling influence on the part of one occupying a confidential relationship with the illiterate grantor, it will authorize a cancellation on the ground of fraud. Mullins v. Barrett, 204 Ga. 11, 48 S.E.2d 842 (1948).
When the evidence and the pleadings show that the deceased was an infirm and aged woman, suffering from a brain tumor, whose mental and physical condition declined during the last years of her life, weakened by the damage to her brain by the illness from which she died, and that the defendants stood in a confidential and fiduciary capacity to her, whereby they administered her medicines to her and cared for her in her illness, took care of her personal business, hired nurses for her, cared for her in their home, and she changed her bank account to make it a joint one with her nephew, one of the defendants, there arose a presumption of undue influence, and the court should have charged on undue influence and the shifting of the burden of proof, and erred in failing to charge thereon. McGahee v. Walden, 216 Ga. 352, 116 S.E.2d 559 (1960).
When evidence is presented of a confidential relationship, the grantor being of weaker mentality and the grantee occupying the dominant position, an issue of fact is raised as to undue influence. Fletcher v. Fletcher, 242 Ga. 158, 249 S.E.2d 530 (1978).
Jury instruction on undue influence.
- Trial court erred in giving a jury instruction that stated that the jury could infer that undue influence existed if it found a confidential relationship was present; the testator made a gift of realty, and the testator was in a weakened mental state and feeble-minded, so the jury was entitled under those circumstances to presume, not merely infer, that undue influence had been shown. White v. Regions Bank, 275 Ga. 38, 561 S.E.2d 806 (2002).
Undue influence question for jury.
- Evidence presented by a testator's child, which proved the testators's disease, medication, and its effects, the testator's dependence on the care givers, their isolation of the testator from the child; their active encouragement and arrangements for the drafting and execution of a new will, the testator's short-term relationship with them, the testator's sporadic contact with and lack of trust towards one of the challenged beneficiaries, and the testator's long-standing expressions of testamentary intent to leave all of the testator's property to the child, which the testator repeated the day after execution of the disposition, supplied sufficient evidence to support the child's claim of undue influence to support the jury verdict in the child's favor and not a directed verdict entered by the trial court in the face of this evidence; although this evidence did not demand a finding that the will was the product of undue influence, it was sufficient to authorize the submission of that question to the jury. Bailey v. Edmundson, 280 Ga. 528, 630 S.E.2d 396 (2006).
A trial court correctly denied an executor's motion for directed verdict in an action wherein the child of the testator filed a caveat and objection to the probate of the testator's last will and testament on the grounds that the will was the product of undue influence as sufficient evidence existed to support the conclusion that undue influence was used to have the testator bequeath the only asset, namely a home, to the caregiver who was hired by the executor. The record established that the executor blocked calls from the testator's child, refused to let the child see the testator, and a confidential relationship was established between the caregiver and the testator as the caregiver took an active role in the planning, preparation, and execution of the will. Bean v. Wilson, 283 Ga. 511, 661 S.E.2d 518 (2008).
RESEARCH REFERENCES
Am. Jur. 2d.
- 27 Am. Jur. 2d, Equity, § 20. 37 Am. Jur. 2d, Fraud and Deceit, §§ 15, 16.
Interference with Attorney-Client Relationship, 19 POF2d 335.
Existence of Attorney-Client Relationship, 48 POF2d 525.
C.J.S.- 30 C.J.S., Equity, § 48. 37 C.J.S., Fraud, §§ 2, 16, 35.
ALR.
- Duty of joint adventures inter se in respect of acquisition or renewal of property rights or interests related to the enterprise, 62 A.L.R. 13.
Trustee's, executor's, administrator's or guardian's purchase from or sale to corporation of which he is an officer or stockholder, as voidable or as ground for surcharging his account, 105 A.L.R. 449.
Duty of vendor of real property to disclose to purchaser condition of building thereon which affects health or safety of persons using same, 141 A.L.R. 967.