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Does the operator in a Joint Operating Agreement owe a fiduciary duty to non-operators?
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The classification of the operator s relationship with the non-operators in a Joint Operating Agreement is an issue that deserves some scrutiny. Is the operator a fiduciary or not? In an attempt to answer this question, this paper will take a case study of the United States model Joint Operating Agreement forms and undertake an analysis of judicial interpretations and approaches to the provisions in the Model Forms regarding the duties and liabilities of operators. Both Common Law and Equity have classically imposed fiduciary duties on trustees and agents. The courts, as we shall see, have, however rendered different connotations in ascertaining the operator s duties despite the clear language used in the Model Forms exempting the operator from fiduciary obligations. The conclusion at the end will highlight the position of the law in other jurisdictions outside the USA.
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