A breach of fiduciary duty is a civil claim, not a crime. In Florida, it is a private cause of action that an injured party brings in civil court to recover money and other relief, not a charge the State prosecutes to put someone in jail. That distinction matters because it controls who can sue, what must be proven, and what the wronged party can actually recover. The same underlying conduct, however, can sometimes cross into criminal territory, which is why the answer is rarely as simple as “one or the other.”
Below, our business litigation attorneys explain how Florida law treats a breach of fiduciary duty, when misconduct can trigger both civil and criminal exposure, and what business owners should do when trust is broken.
What Is a Fiduciary Duty Under Florida Law?
A fiduciary duty is a legal obligation to act in another person’s best interest, with loyalty and good faith, rather than for one’s own benefit. It arises when one party places special trust and confidence in another, and the other accepts that trust and undertakes to advise, act, or manage assets for the first party’s benefit. Fiduciary relationships carry the highest duty the law recognizes between private parties.
Who Owes a Fiduciary Duty?
Fiduciary duties exist in many business relationships. Common examples in Florida include corporate officers and directors, who owe duties of care and loyalty to the company and, in closely held businesses, to fellow owners. Business partners owe fiduciary duties to one another, and managers of a limited liability company generally owe duties to the members. These obligations often overlap with the rights spelled out in member, shareholder, and partner agreements and in a company’s board of directors structure and oversight function.
Fiduciary duties also arise for agents acting for a principal, trustees, attorneys, and others in a position of confidence. The relationship, not the job title, is what creates the duty. Disputes among owners frequently surface in shareholder disputes and in closely held companies and family-owned businesses, where owners rely heavily on one another.
What Are the Elements of a Breach of Fiduciary Duty Claim?
To win a breach of fiduciary duty claim in Florida, a plaintiff must prove three elements. As the Florida Supreme Court stated in Gracey v. Eaker, 837 So. 2d 348 (Fla. 2002), the elements are the existence of a fiduciary duty, the breach of that duty, and damages proximately caused by the breach. See Gracey v. Eaker.
In practice, that means the plaintiff first establishes that a fiduciary relationship existed. Next, the plaintiff shows the fiduciary acted disloyally, carelessly, or in self-interest, for example by diverting a business opportunity, self-dealing, hiding information, or mismanaging assets. Finally, the plaintiff proves that the breach caused real harm. Our attorneys handle these disputes as part of our breach of fiduciary duty practice.
Why Is Breach of Fiduciary Duty a Civil Claim and Not a Crime?
Breach of fiduciary duty is a civil claim because it is a private wrong between parties, resolved through the civil justice system rather than the criminal courts. A crime is an offense against the State, prosecuted by a government attorney, and punishable by incarceration or criminal fines. A civil claim is brought by the injured party to obtain compensation and equitable relief.
Three practical differences flow from that distinction. First, the parties differ: a private plaintiff files a civil claim, while a prosecutor files criminal charges. Second, the burden of proof differs: a civil plaintiff must prove the case by a preponderance of the evidence, a far lower standard than the “beyond a reasonable doubt” standard in a criminal case. Third, the outcome differs: a civil case seeks money damages and court orders, not a jail sentence. This is the same framework that applies to most business torts we litigate, from fraud and fraud in the inducement to conversion.
When Can the Same Conduct Also Be a Crime?
The same conduct can be both a civil breach and a crime when it independently violates a criminal statute. A breach of fiduciary duty by itself is not criminal, but the acts making up the breach, such as stealing company funds or lying to induce a transaction, may also fit the definition of a separate criminal offense. When that happens, a fiduciary can face a civil lawsuit from the victim and criminal prosecution by the State at the same time.
Theft and Embezzlement
A fiduciary who takes money or property that belongs to the company or the beneficiary may commit theft. Florida’s theft statute, Fla. Stat. § 812.014, makes it a crime to knowingly obtain or use another’s property with intent to deprive the owner of it, and grades the offense from petit theft to first-degree grand theft based on value. The same taking can support a civil claim, including a civil theft action, which in Florida can carry treble damages and attorney’s fees.
Fraud and Related Offenses
Deceptive conduct by a fiduciary can also give rise to criminal fraud charges alongside civil claims. On the civil side, the victim may pursue constructive fraud, claims under the Florida Deceptive and Unfair Trade Practices Act (FDUTPA), or claims for aiding and abetting and civil conspiracy against others who helped. Where trade secrets or confidential information are misused, a misappropriation of a trade secret claim may also apply.
What Remedies Are Available for Breach of Fiduciary Duty?
Florida law offers a wide range of civil remedies for breach of fiduciary duty, most aimed at making the injured party whole and stripping the fiduciary of improper gains. Compensatory damages are the starting point, but the equitable remedies are often just as important in these cases.
Available relief commonly includes disgorgement of profits the fiduciary earned through the breach, an equitable accounting to trace funds and transactions, and a constructive trust imposed over wrongfully held assets. Courts can also enter an injunction to stop ongoing misconduct, and, where the fiduciary acted with intentional misconduct or gross negligence, punitive damages may be available. Related claims, such as breach of the implied covenant of good faith and fair dealing, are frequently pleaded alongside the fiduciary claim to maximize recovery.
How Long Do You Have to File a Breach of Fiduciary Duty Claim in Florida?
A breach of fiduciary duty claim in Florida is generally subject to a four-year statute of limitations. That deadline flows from Fla. Stat. § 95.11, which sets a four-year period for most intentional torts and for actions founded on fraud. When the claim is founded on fraud, the clock may run from when the fraud was discovered or should have been discovered, though Florida courts apply that delayed-discovery rule narrowly.
Because the limitations period can vary with the facts, and because different rules apply to claims against trustees, business owners should not assume they have four years. Missing the deadline can bar an otherwise strong claim, so it is worth confirming the applicable period early.
What Should Florida Business Owners Do If They Suspect a Breach?
Business owners who suspect a breach of fiduciary duty should act quickly to preserve records, document the suspected misconduct, and avoid tipping off the fiduciary before evidence is secured. Financial records, emails, board minutes, and transaction histories are often the backbone of these cases, and they can disappear once a dispute becomes open.
Early legal guidance also helps owners decide whether to pursue civil claims, refer the matter for criminal investigation, or both, and whether emergency relief such as an injunction or the appointment of a receiver is warranted. Because these disputes often threaten the value and control of the business itself, a measured, well-documented approach protects both the company and the owner’s leverage.
Key Takeaways
Breach of fiduciary duty is a civil claim in Florida, brought by the injured party to recover damages and equitable relief, not a crime prosecuted by the State. Even so, the conduct behind a breach can independently violate criminal statutes like theft or fraud, exposing a disloyal fiduciary to both a lawsuit and prosecution. Florida law gives victims powerful civil tools, including disgorgement, an accounting, a constructive trust, injunctive relief, and sometimes punitive damages, but a four-year deadline usually applies.
If you believe a partner, officer, director, or other fiduciary has betrayed your trust, Jimerson Birr’s business litigation team can help you evaluate your options and protect your business.
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