What are typical remedies for breach of fiduciary duties, and when might disgorgement or a constructive trust be appropriate?

• A. Damages, rescission, punitive damages, and criminal penalties.
• B. Damages, injunctive relief only; disgorgement is never available.
• C. Damages, disgorgement of profits, rescission, injunctive relief.
• D. Only criminal penalties apply.

Answer: (C)

Remedies for breach of fiduciary duties blend compensation, prevention, and restoration to the proper state. Damages address actual losses to the beneficiary, while disgorgement prevents the fiduciary from keeping profits earned through the breach, ensuring the wrongdoer does not profit from wrongdoing. Rescission may be available to unwind a transaction tainted by the breach, returning parties toward their pre-transaction positions where possible. Injunctive relief stops ongoing or threatened breaches, preserving the beneficiary’s interests in real time. Constructive trusts come into play when profits or assets obtained through the breach can be traced to the fiduciary; the court can treat those assets as held in trust for the beneficiary, effectively forcing transfer of the property to the rightful owner.

So the typical civil remedies include damages, disgorgement of profits, rescission, and injunctive relief, with disgorgement (and a constructive trust where appropriate) used to address unjust enrichment from the breach. Criminal penalties or punitive damages are not standard civil remedies for fiduciary breach.