PJC Business

PJC 104.4

F IDUCIARY D UTY

and winding up of partnership business.” M.R. Champion, Inc. v. Mizell , 904 S.W.2d 617, 618 (Tex. 1995). While the scope of partnership duties can be altered by agree ment, partners cannot entirely eliminate the duties of loyalty and care, and these duties must be discharged in good faith and in a manner the partner reasonably believes to be in the best interest of the partnership. See Tex. Bus. Orgs. Code §§152.002, 152.204– .207. Broad-form submission. PJC 104.4 is a broad-form question designed to be accompanied by one or more appropriate instructions. Tex. R. Civ. P. 277 requires that “the court shall, whenever feasible, submit the cause upon broad-form questions.” Tex. R. Civ. P. 277; see Thota v. Young , 366 S.W.3d 678, 689 (Tex. 2012) (rule 277’s use of “whenever feasible” mandates broad-form submission in any or every instance in which it is capable of being accomplished). For further discussion, see PJC 116.2 regarding broad-form issues and the Casteel doctrine. Presumption of unfairness shifts burden of proof. When a fiduciary profits or benefits in any way from a transaction with the beneficiary, a presumption of unfair ness arises that shifts the burden of persuasion to the fiduciary or the party claiming the validity or benefits of the transaction to show that the transaction was fair and equitable to the beneficiary. Keck, Mahin & Cate v. National Union Fire Insurance Co. of Pittsburgh , 20 S.W.3d 692, 699 (Tex. 2000); Texas Bank & Trust Co. v. Moore , 595 S.W.2d 502, 509 (Tex. 1980); Archer v. Griffith , 390 S.W.2d 735, 739 (Tex. 1964). The presumption may be rebutted by the fiduciary. Stephens County Museum, Inc. v. Swenson , 517 S.W.2d 257, 261 (Tex. 1974); see also Texas Bank & Trust Co. , 595 S.W.2d at 509. Normally, a rebuttable presumption shifts the burden of producing evi dence to the party against whom it operates but does not shift the burden of persuasion to that party. General Motors Corp. v. Saenz , 873 S.W.2d 353, 359 (Tex. 1993). In fiduciary duty cases, however, the presumption of unfairness operates to shift both the burden of producing evidence and the burden of persuasion to the fiduciary. Sorrell v. Elsey , 748 S.W.2d 584, 586 (Tex. App.—San Antonio 1988, writ denied); Miller v. Miller , 700 S.W.2d 941, 945–46 (Tex. App.—Dallas 1985, writ ref’d n.r.e.); Fillion v. Troy , 656 S.W.2d 912, 914 (Tex. App.—Houston [1st Dist.] 1983, writ ref’d n.r.e.); Cole v. Plummer , 559 S.W.2d 87, 89 (Tex. App.—Eastland 1977, writ ref’d n.r.e.); see also Johnson v. Peckham , 120 S.W.2d 786, 788 (Tex. 1938) (issue of whether benefi ciary of fiduciary relationship relied on fiduciary to perform his duties was immate rial). If there is no evidence rebutting the presumption, no breach of fiduciary duty ques tion is necessary. Texas Bank & Trust Co. , 595 S.W.2d at 509. Liability questions normally place the burden of proof on the plaintiff, who is required to obtain an affirmative finding. When the burden is shifted to the fiduciary, however, a “No” answer supports liability. Thus, when the burden is on the fiduciary to prove compliance with his fiduciary duties, subsequent questions that depend on a

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