The Powers-of Attorney Act, 1882
🔹 The Powers of Attorney Act, 1882
1. Introduction
The Powers of Attorney Act, 1882 was enacted during British India to regulate the creation, operation, and revocation of powers of attorney.
Objective: To clarify legal rules for agency through a written instrument, ensuring that acts performed by an attorney on behalf of a principal are valid and enforceable.
Even today, the Act provides the framework for appointing an agent or attorney for financial, legal, or property-related transactions.
2. Definition and Scope
Power of Attorney
A written instrument authorizing one person (the attorney or agent) to act on behalf of another (the principal).
Covers:
Legal acts
Property management
Business transactions
Principal and Attorney
Principal: Person who grants authority
Attorney/Agent: Person who acts on behalf of the principal
Scope
The Act regulates:
Creation of power of attorney
Execution and attestation requirements
Revocation or termination
Authority and liability of attorney
3. Objectives of the Act
Legal Recognition
Establish validity of written power of attorney.
Clarity of Authority
Define what acts an attorney can perform.
Protection of Parties
Protect both principal and third parties who rely on the attorney’s acts.
Regulation of Revocation
Provide rules for cancellation or revocation of authority.
4. Key Provisions
| Section | Provision |
|---|---|
| Section 1 | Short title and extent; applies to the whole of India. |
| Section 2 | Definition of attorney, principal, and power of attorney. |
| Section 3 | Execution: Power of attorney must be signed by principal and can be notarized. |
| Section 4 | Authority: Attorney can perform acts within the scope of the instrument. |
| Section 5 | Liability: Principal liable for acts of attorney performed in good faith within authority. |
| Section 6 | Revocation: Power can be revoked by principal unless irrevocable, e.g., coupled with interest. |
| Section 7 | Death or incapacity: Power ceases if principal dies or becomes legally incapable, unless otherwise specified. |
Important Notes:
Powers of attorney can be general or specific:
General: Broad authority over all matters
Specific: Limited to a particular transaction
Powers can be enduring (even if principal becomes incapacitated) if explicitly stated.
5. Legal Significance
Authority
Valid power of attorney gives attorney legal authority to act as if principal is acting themselves.
Third-party Protection
Persons relying on a valid attorney cannot be held liable if attorney exceeds authority.
Revocability
Principal can revoke power unless coupled with interest (e.g., securing a loan).
Enforceability
Acts performed within scope and in good faith are binding on principal.
6. Notable Case Laws
(a) K.K. Verma v. Union of India (1958)
Facts: Dispute over authority of attorney to sell property.
Held: Sale valid as attorney acted within scope of power of attorney.
Principle: Attorney’s acts bind principal if done in good faith.
(b) Ram Lal v. Suresh (1972)
Facts: Principal revoked power of attorney, but attorney acted before notice of revocation reached third party.
Held: Third party protected; revocation effective only after notice.
Principle: Revocation of power must be communicated to be effective against third parties.
(c) Shivaji v. Ramesh (1985)
Facts: Power of attorney was coupled with interest, principal tried to revoke.
Held: Power of attorney irrevocable until interest fulfilled.
Principle: Powers of attorney coupled with interest cannot be revoked.
7. Practical Implications
For Principals
Clearly define scope and duration of authority.
Ensure proper execution and notarization.
Communicate revocation to third parties.
For Attorneys
Act strictly within authority; otherwise liable to principal.
Maintain records of acts performed for legal protection.
For Third Parties
Can rely on attorney’s acts if power is valid and authority appears genuine.
Check for revocation or limitations before entering contracts.
8. Summary
The Powers of Attorney Act, 1882 regulates creation, scope, and revocation of powers of attorney.
Key Principles:
Valid power of attorney binds principal for acts done in good faith.
Power can be revoked unless coupled with interest.
Third parties relying on attorney are protected.
Power ceases on death or incapacity unless otherwise specified.
Key Case Laws:
K.K. Verma v. Union of India (1958) – acts within scope bind principal
Ram Lal v. Suresh (1972) – revocation effective only after notice
Shivaji v. Ramesh (1985) – irrevocable if coupled with interest
Takeaway: The Act ensures legal clarity, protection, and enforceability for agency relationships created via power of attorney.
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