Principles of Fiduciary Relationships

See, Frame v. Smith, [1987] 2 SCR 99. Hospital Products Ltd. v. United States Surgical Corporation Ltd., (1984) 156 CLR 41 rightly observed, the scope of fiduciary duties is moulded according to the nature of the relationship and facts of the case. Principles of Fiduciary Relationships are equitable. Equity never operates in an absolute manner or in a vacuum. In fact, the very basis of the Law of Equity is its flexibility to take care of mutual concerns of the parties. Equity is about balancing the competing interests – by preventing the erosion of interests of one party while ensuring a free exercise of legally enshrined discretionary powers to the other. Equitable Common Law Principles cannot be used to create mandatory legal obligations.

Hon’ble Justice A.M. Khanwilkar, Rusoday Securities Ltd. v. National Stock Exchange of India, [Civil Appeal No. 2690 of 2009].