Another characteristic in light of which it is possible to recognize a relationship of trust is when the relevant party undertakes to act for the benefit of another (ibid., at p. 45), and when the beneficiary suffers from a vulnerability in relation to the trustee (ibid., at p. 46).
In general, it will be interesting to note that the authors of the Civil Code on Financial Law have pointed to typical circumstances in which it will be possible to recognize a fiduciary duty, in which "the affairs or assets of the eligible person are entrusted to the fiduciary with the consent of the fiduciary debtor, or according to legislation, for the purpose of preserving or managing them for the benefit of the entitled" (section 513(1) of the Civil Code, Property Law Law: Text for Public Review (Vol. 1; 2004) (hereinafter: the Codex). or that "the debtor of trust provides the eligible person with a service of a personal nature, which by its nature involves the reliance of the entitled person on his integrity and fairness" (ibid., at section 513(3)).
- The world of the laws of faith is suitable for application in our case. Although, on a formal level, the members of the purchasing group can have direct control over their interests, but in essence and in most cases, these members are completely dependent on the group's organs. In all cases, there is a case in which "a person grants power to another over his own affairs without that person having a real possibility of guarding his own affairs," which is the basis of the laws of faith (see above at paragraph 131). At the very least, it can be said that the possibility of the individual member of the group to take care of his own affairs is very limited. The same power entrusted to others is liable to be abused, and this exploitation is liable to have serious consequences, given the heavy interests at stake.
- Applying the law of trust to the world of purchasing groups can contribute to reducing the risks and coping with the vulnerability of the group members. By virtue of it, it will be possible to apply various duties, including the obligations to provide ongoing information to the members of the group (see the Merck case) and to deal with the fear of acting in a conflict of interest. Since these are duties created by the case law, they can be developed and adapted according to the various challenges on the agenda, and to the changing circumstances.
The Law of Trust and the Position of the Lawyers Accompanying the Purchasing Group
- What is the role of the lawyers accompanying the purchasing group given its subordination to the law of trust?
As a starting point, it should be noted that lawyers are no strangers to the field of trust. The relationship between a lawyer and his client "is considered a classic case in which the duty of trust applies" (see Naftali Ben-Zion, at pp. 277-278). And in order for this to be established, it is not necessary for the lawyer to control the client's actual property.
- The set of duties imposed on the lawyer can also be understood from the perspective of the law of emissary. Section 8 of the Emissary Law, 5725-1965 (hereinafter: the Shlichut Law) states that "if a person receives a shlichut he must be an emissary, he must act faithfully towards the sender and act in accordance with his instructions." And the provisions of the law apply to the relationship between lawyers and their clients, since the former are the emissaries of the latter.
The Law of Mission, for example, imposes on the agent to act faithfully toward the sender. "This does not mean that the relationship of emissary, in and of itself, makes the sender the trustee the trustee and the sender the beneficiary. Indeed, the "proprietary trust" also exists in the relationship of shlichut, when as a result of the shlichut an asset comes into the hands of the shluch. However, the obligation of the agent to act in trust also exists where every asset does not come into the hands of the agent. Indeed, the duty of the sender can be described more accurately if it is stated that he is obligated to "act in faith" towards the sender, or to act with "trust" toward him. This 'duty of trust' is imposed on the agent without any connection to the presence of an asset in the possession of the agent. The very existence of a relationship of emissary between the sender and the sender imposes on the sender a duty of trust and faith towards the sender [...]. Indeed, if in the relationship between (adversary) parties to a contract 'good faith' (ordinary) is required, i.e., man to person, then in the relationship between sender and sender trust and loyalty are required - that is, man to man-angel" (see the discussion with Aharon Barak, The Shlichut Law 1042-1043 (Vol. II, 1996) (hereinafter: Barak)).
136. Against this background, a lawyer owes his client on several levels. The first level is the contractual level: the contract between the parties defines the role of the lawyer and the boundaries of his mission. the contractual obligations that the lawyer has taken upon him, in accordance with what is stated in them.
The second level imposes duties of trust by virtue of the status of being an agent and trustee. These obligations stand independently of the contractual definitions of the relationship between the parties. Contractual duties separately and fiduciary duties by virtue of the position separately.
- Therefore, when we are dealing with purchasing groups, the written contractual relationship, which has been established - between the members of the group on the one hand and its lawyers on the other - should not be perceived as exhaustive. Alongside the contractual duties assumed by Adv. Nof and Aaronson, in accordance with the representation agreement, are the general legal obligations imposed on the actors on behalf of the members of the purchasing group. They have a general duty to act with "trust" toward their senders.
- And what is the relationship between contractual obligations and the general duties imposed on lawyers? The answer is that in the absence of any other provision, these obligations apply simultaneously. The contractual obligations are shaped by virtue of the contract, and the general obligations are formed by virtue of the general law; by virtue of enteringinto an attorney-client relationship; by virtue of the laws of mission and trust, as well as all other general norms that apply to lawyers, including ethical and disciplinary norms.
- However, there is an interface between the levels. The parties to the contract can stipulate on the applicability of the general law. They can exempt lawyers from certain duties or qualify. They can absolve them of responsibility for failures in their conduct. A significant part of the laws of emissary are conditional. They are dispositive. Thus, in accordance with section 8(1) of the Shlichut Law, the duty of disclosure imposed by the law is subject to the examination of whether "there is no other intention implied by the essence of the shlichut or its terms". Hence, the parties may set in the agreement terms that qualify it or shape it according to their wishes.
And yet the power of conditioning is limited. There is a core of debts that are cogent, and an attempt to circumvent them by means of contractual restrictions will not succeed. The ability to condition fiduciary duties is also subject to the principle of good faith, starting with the general law. In this regard, the analysis of Prof. Barak who noted (at p. 1051) is particularly interesting: