Which of the following best describes the term ‘fiduciary’?

The term ‘fiduciary’ refers to a relationship that is based on trust and involves an obligation to act in someone else's best interest. This definition is rooted in the legal and ethical responsibilities that exist between parties, particularly in situations where one party is entrusted to manage assets or make decisions on behalf of another. In real estate, for example, an agent has a fiduciary duty to their client, meaning they must prioritize the client’s interests above their own, provide full disclosure of relevant information, and maintain confidentiality regarding the client’s affairs.

This concept is crucial in real estate transactions, as it establishes a level of trust and accountability between agents and clients, ensuring that the agent acts with care, loyalty, and good faith. Understanding fiduciary duties is essential for real estate professionals as it reflects the ethical standards and legal obligations they must uphold in their practice.