“Fiduciary” is basically defined by Black’s Law Dictionary as a term derived from Roman law which means, as a noun, a person or legal entity, holding the character of a trustee, with respect to the trust and confidence involved as scrupulous good-faith and candor towards another’s affairs. A fiduciary also has duties which are described as involving good-faith, trust, special confidence, and candor toward another’s interests. Typical fiduciary duties are imposed on and include such relationships as executor, administrator, trustee, real estate agents, attorneys, and, of course, property managers. A person or company who manages money or property, i.e., the manager, for other people must exercise a standard of care in that the interests of the money or property owners are placed above and beyond those of the property manager. In some states, like California for example, a property manager is statutorily defined as an individual or entity which has the same duties as a trustee, i.e., a fiduciary.The way I always explain it to clients, using my hands to demonstrate, is that my interests end at the top of my head (one hand at the crown of my head), but the client’s interest rise above and beyond my head and take precedent over my own (holding both of my hands above my head in a clasped position). Most people understand the gesture and comprehend that as a property manager and a lawyer my interests are much lower than those of the clients in our relationship.Common Fiduciary Duties Owed by Property ManagersSince a property manager is a fiduciary they must act with the highest good-faith and fair dealing with respect to the owner’s asset, disclose all material information that may affect the owners decision-making with respect to that asset, and can’t in any way, shape or form act adversely to the owner’s interests. This may sound easy, but there are situations that arise that tempt even the best property managers to sometimes not act in their client’s best interests to suit their own self-interested convenience. Unfortunate as that may sound it happens regularly.The following is a short list of some common sense duties, rights, and wrongs when a fiduciary relationship exists between a manager and an owner.A manager should have a written agreement with their clients and may even be legally entitled to profit from services for which they provide to the owner, however, a manager may not secretly profit from this relationship. For example, a manager may charge an eight percent markup on materials and services provided by vendors to the owner’s property. This is legal and acceptable provided that the agreement between the parties is in concert with the markup. If this markup was not in the agreement then the law requires a property manager to disgorge or relinquish any and all secret profits derived from the relationship. There are so many possible examples of this, but a common one is a manager making a percentage profit on work and services provided to their clients but not disclosed; like a new roof, bathroom remodel, repairs to interior walls, etc.A property manager is required to disclose any and all rental offers received along with documentation of those offers such that the property owner is well informed about all potential tenants. It is easy for a manager to fail to provide names of potential tenants that don’t necessarily qualify or are poor credit risks as this would involve more work for the manager.A property manager is statutorily required to act for the sole benefit of the asset owner in matters that evolve from the relationship, whether or not those matters are seemingly insignificant or they are significantly material.Information about a tenant whom falls behind on their rent must be immediately communicated to the asset owner. If your management company is using a software system that allows an “Owner Portal” then this information is readily available to see and anytime one has access to the internet.If a manager receives information that a tenant has caused damage to a property the owner should be notified as soon as feasibly possible. It is easy for the manager to not disclose this information for fear of confronting the disgruntled owner or just not wanting to deal with the conflict associated with that situation.Trust Account DutiesA trust account which holds deposits and rent monies for the benefit of the asset owner is a common ground for fiduciary duty breaches. The law precludes a manager from commingling of the client trust funds with broker or manager owned funds.Additionally, it is a breach of fiduciary duty to make mortgage payments on broker owned properties from a trust account even if the broker quickly reimburses the account for the payments. The statutory prohibition against conducting personal business from trust accounts is strictly enforced.Surprisingly another common example of commingling of funds occurs when the property management fee is not timely withdrawn from the trust account. Sometimes a delay of twenty-five (25) days could be considered commingling.Trust funds must also be deposited with expediency. Some states require that deposits must be deposited by no later than the next business day.Commingling of Trust Funds is a Serious OffenseCommingling of trust and broker funds is such a serious offense it can be grounds for revocation or suspension of a broker’s license in most states. Thus, this sole issue must be of paramount importance to a manager and property management company.ConclusionManagers owe fiduciary duties to their clients – this is the minimum standard owed. There are many ways to breach these duties which form the basis for the relationship between the manager and the client. It is important to hire a property manager who understands and abides by the statutory framework, understands fully what a fiduciary duty entails, and can both clearly communicate those duties and at the same time live up to them. It is important for owners to make sure they hire property managers who abide by these minimum standards.

How to find the right product for your companyCorporate software managers face a dynamic and unpredictable market for the tools they need to help them manage their company’s software purchases, licenses and operations. Considering the rate of new players in this industry and new products brought to market, it’s no wonder finding the right software asset management (SAM) tool can be a challenge.Companies evaluating tools today have a lot of option and features to consider including on-premises versus SAM software-as-a-service, plus specialized tools versus full-function tool suites. This is why independent and comprehensive tool assessments and comparisons are an invaluable instrument that saves time and money. But all tool reviews are not created equal.Tool Manager, a publication that rates software asset management and IT asset management tools, digs deep into the latest product offerings, from companies such as Aspera, IBM, CA, HP, and Flexera Software. “We work with product management at the software tool companies to provide a full view of each product’s features and functions, but we also collect data from end users, plus our own assessors give the tools a thorough test drive,” says Steven Russman, editor of Tools Manager.Russman’s reviews, issued several times a year, use a rating system that assesses each tool’s attributes, such as ease-of-use, inventory management, wizards and menus, compliance to standards, depth of the software reconciliation library and a dozen more points designed to provide an extensive measure of the product’s functions. Each Tools Manager edition focuses on a single vendor, typically one with a new product or version about to launch.In a recent review of IBM’s License Metric Tool (ILMT), Tools Manager affirmed, “IBM delivers what it promises with ILMT, a well-designed tool to capture and report usage for license compliance.” Tools Manager says that “IBM customers looking for more will need to upgrade to the full version of Tivoli Asset Discovery and Tivoli Asset Management for IT or another product for repository functions.”Tools Manager strives to provide readers with not only a nuts-and-bolts product assessment but also an experienced interpretation of a company’s direction. “We always ask the software company about its roadmap for the future, and the next version of its tool,” says Russman. “Many are open to telling us their plans but others are not and require confidentiality agreements, so we’re not permitted to share all the materials with our readers, however, we can share our opinions and where we see specific companies headed.”Russman, a 13-year veteran of the software asset management field, is the executive director of the International Business Software Managers Association, the world’s largest nonprofit association of business-focused software management professionals, which hosts an annual conference for software asset managers along with continuing education and certifications.”As the software asset management product landscape continues to shift and new tools are brought to market more rapidly,” says Russman, “Tools Manager is ready to provide SAM professionals with the insights and objective information they need to succeed.”For more about Tools Manager, visit the International Business Software Managers Association at IBSMA.com.