Merriam Webster on their website defines a fiduciary as “one often in a position of authority who obligates himself or herself to act on behalf of another (as in managing money or property) and assumes a duty to act in good faith and with care, candor, and loyalty in fulfilling the obligation : one (as an agent) having a fiduciary duty to another ”
Often a fiduciary is appointed by a court order to administer the estate or property of another person who is unable to manage their own affairs. Many times these appointed fiduciaries are required by law to provide a bond guarantying that they will faithfully perform their fiduciary duties in accordance with the state’s laws and statutes. Generally, this includes paying bills and distributing remaining assets in accordance with the state laws and/or the will of the deceased.
There are three commons fiduciary bonds that Goldleaf Surety often sees – Administrator or Executor Bond, Guardianship Bond, and Trustee Bond.
- An Administrator (there is no will)/Executor (there is a will) bond is posted on behave of the administrator or executor of an estate assuring that they perform their duties according to the will and/or the legal requirements of the jurisdiction. The appointment of the administrator or executor is usually short term in nature. The appointment is made for the purpose of gathering the estate assets, paying the deceased’s bills, and distributing the remaining assets to the heirs.
- A Guardianship Bond is required to protect the minor or incapacitated person over which someone has been appointed guardianship. Since the guardian typically has control over the finances and/or well-being of another person, these bonds are in place so that the guardian acts in the best interest of the individual and in accordance with the court orders.
- A Trustee Bond is required to protect the interests of the trust’s beneficiaries – the grantor (if living) and the beneficiaries who will receive them after the grantor dies. Trustee bonds provide security that the person performs their duties in a legal and ethical manner without fraud, dishonesty or deception and in accordance with the court orders.
If you need assistance placing a fiduciary bond, or any type of court bond, Goldleaf Surety is here to assist you.