Claim for Aiding and Abetting Breach of Fiduciary Duty Does Not Depend on Origin of Duty
The Delaware Chancery Court recently held that a legal claim exists for aiding and abetting a breach of a contractually-created fiduciary duty. In so holding, the Court emphasized that such claim does not depend on whether the origin of the underlying fiduciary duty is statutory or contractual.
In Fitzgerald v. Cantor, the plaintiff claimed that two of the defendants aided and abetted other co-defendants in their breaches of fiduciary duties that were set forth in the underlying partnership agreement with plaintiff. The two defendants moved for summary judgment dismissing the claim. According to the two defendants, since the alleged fiduciary duties arose out of the terms of the partnership agreement at issue, plaintiff was actually making a claim for breach of contract. "[S]ince there is no recognized claim for aiding and abetting a breach of contract distinct from a claim for tortious interference with a contract," the defendants argued, plaintiff had failed to state a claim for relief.
The Chancery Court disagreed, holding that a claim for aiding and abetting a breach of fiduciary duty may exist regardless of whether the origin of the underlying duty is statutory or contractual. To hold otherwise, the Court reasoned, would conflict with 6 Del. C. § 17-1101(d), which permits partners to define their fiduciary duties in the partnership agreement, and "would deprive a partnership and its partners of claims against those who encourage or otherwise collaborate with a partner which breaches fiduciary duties for which all partners contracted." Since the plaintiff had alleged the requisite elements to support such claim, including the existence of a fiduciary relationship by virtue of the partnership agreement, the court found that the plaintiff had stated a viable claim for relief and denied the motion for summary judgment. *
Fitzgerald v. Cantor, No. 16297-NC, 1999 WL 182573 (Del. Ch. Mar. 25, 1999).