Do you have the legal authority to act?

24/07/2023 - By Tiffany Mare

It is of high importance to ensure that you have the legal authority to act on another person’s behalf before doing so. Acting without the correct authority to do so may result in exposing yourself to personal liability for losses incurred by third parties due to the result of the transactions concluded in terms of a lapsed or invalid power of attorney.

What is a power of attorney?
A power of attorney is a written authority given from one person (the grantor who has full contractual capacity) to another (the agent), authorising the agent to perform the specific acts stipulated therein on their behalf. A power of attorney to pass transfer is one of the documents required to be lodged with the deed of transfer at the Deeds Registry in order to transfer the property to its new owner.

You can grant one of two Powers of Attorney;

Special Power of attorney

The agent is given authority to act in one specific transaction and the power to act would lapse on completion of the act. For example, signing the transfer documents for the property you are selling. The original signed Power of Attorney will need to be lodged together with the transfer documents in the Deeds Office.

General Power of attorney

The agent is given authority to act in a collection of transactions generally on behalf of the grantor . A General Power of Attorney is wide and all-encompassing. This allows the agent to authorise the transactions, agreements, or conduct various activities on behalf of the grantor. The original document will need to be lodged and registered at the Deeds office, which can then be used for future property transactions as well.

A Special or General Power of Attorney can be revoked at any time by the grantor in writing.

What happens if the grantor that signed the power of attorney passes away or lands up being mentally unfit before the transaction is complete?

The Power of Attorneys is automatically terminated if;
• The grantor dies;
• The grantor’s estate is sequestrated;
• The grantor becomes mentally unfit.

In the above circumstances, an application will have to be made to the Master of the High Court in order to obtain either;
• Letters of Executorship in order for the executor to sign on behalf of the deceased estate.
• Letters of Authority in order for the trustee to act on behalf of the insolvent estate.
• Letters of Curatorship in order for the Curator to act on behalf of the mentally unfit.

In conclusion, the Power of Attorney lapses as soon as the grantor loses the capacity to act. It is highly recommended that the agent should at all times ensure that they are entitled to act under the Power of Attorney before doing so to avoid their actions being declared unlawful and/or void.