Who is referred to as the principal in a fiduciary relationship?

In a fiduciary relationship, the principal is defined as the individual or entity that delegates authority to another party, known as the agent. This relationship is rooted in trust and responsibility, where the principal relies on the agent to act on their behalf in various matters, typically in areas like real estate transactions or financial management. The agent is expected to act in the best interest of the principal, maintaining a position of loyalty and support.

Understanding this relationship is crucial because it entails a legal and ethical requirement for the agent to prioritize the principal's interests above their own. Therefore, the principal's role is pivotal, as they empower the agent with authority to make decisions or perform actions that affect their interests. The emphasis on delegation clarifies how the dynamic functions within the context of fiduciary responsibility.