Stone entered into an agreement with Star Alarms Inc,a corporation that sells alarm systems for personal residences,under which he would act as an agent for Star to find customers for Star's alarm systems.In the course of his work for Star,Stone learns quite a bit about alarm systems.A friend offers to sell him an alarm system business for commercial buildings,a segment of the market that Star has never pursued.Stone decides that he would like to buy the business.Which of the following is TRUE? Stone's fiduciary duty requires that he

Question

Quizplus · Accepted Answer

As an agent for Star, Stone owes a fiduciary duty to act in the best interests of Star and not to use or disclose confidential information for his own benefit. However, if Stone wishes to pursue a business opportunity that is outside the scope of his agency with Star, he may do so, but he must first disclose the opportunity to Star and give Star the opportunity to pursue it. If Star rejects the opportunity, Stone may then pursue it, but he must keep Star's information confidential and not use it for his own benefit unless he obtains Star's consent. This choice is the best option as it balances Stone's personal self-interest with his fiduciary duty to Star.

Stone Entered into an Agreement with Star Alarms Inc,a Corporation