Legal Matters – Page 4

You are going abroad for work so you wonder how you can draft a power of attorney authorizing your cousin to manage your business and properties while you are away. This guide is here to help you draft a general power of attorney, the type of power of attorney that is applicable to your case. DISCLAIMER: This article has been written for general informational purposes only and is not legal advice or a substitute for legal counsel. You should contact your attorney to obtain advice with respect to any particular issue or problem. The use of the information contained herein does not create an attorney-client relationship between the author and the user/reader. What Is a General Power of Attorney? A General Power of Attorney is a document authorizing another person (called the agent) to render some service or do something in representation or on behalf of another (called the principal). The service or task to be performed by the agent in a General Power of Attorney is limited to the act of administration of the business or affairs of the principal. What Is the Difference Between a Special Power of Attorney and a General Power of Attorney? The General Power of Attorney (GPA) and the Special Power of Attorney (SPA) both give the agent the power to act for and on behalf of the principal. The difference lies in the scope of authority given to the agent. In GPA, the agent’s authority covers the act of administration of all the businesses of the principal. On the other hand, a SPA is for one or more specific transactions. When Should I Draft a General Power of Attorney/Special Power of Attorney? If you want your agent or representative to administer, manage, or supervise your business or property, then you may execute a GPA. The tasks under a GPA encompass all acts of administration, except those cases where a SPA is required under the law to make the action of the agent valid and binding to the principal. For example, even if you gave your agent a GPA, your agent cannot sell or donate the property entrusted under the GPA because selling or donating (or any act of transfer of ownership of the real property) requires a SPA. Several cases had been decided by the Supreme Court, where the sale of real property was invalidated as the agent is only clothed with a GPA instead of SPA. Article 1878 of the New Civil Code of the Philippines1 lists all actions that require SPA and not just a GPA. A GPA is usually given when you want a trusted person to administer or manage your business or property when you cannot attend to it personally for some reason (e.g., you are abroad). How To Make or Draft a General Power of Attorney: 3 Steps. Drafting a General Power of Attorney is easy with the following steps: 1. Prepare the document. A General Power of Attorney contains the following parts: Title of the document.Name of the parties (principal and attorney-in-fact), a statement stating they are of legal age, their civil status, citizenship, and residence address. Enumeration of the tasks to be performed by the agent/attorney-in-fact.Date and place where the principal will sign the GPA.Name and signature of the principal.Name and signature of the agent.Name and signature of witnesses.Acknowledgment from the notary public. 2. Print at least 3 copies of the document. One copy goes to the notary public.One or two copies go to the principal.One or two copies go to the agent. 3. Go to a notary public to have the GPA notarized. Don’t forget to bring a valid ID as the notary will have to verify your identity. Free Downloadable/Editable General Power of Attorney Sample Template. To save you the hassle of writing a General Power of Attorney from scratch, you may download this sample template and edit the contents using the above guide. You may delete the rest of the clauses not needed. Frequently Asked Questions. 1. How much does it cost to have a General Power of Attorney? The cost of notarization varies depending on the location and the notary public. Rates could range from Php 500 to Php 1,000 or higher. 2. Can a General Power of Attorney be revoked? How can I cancel it? Yes, a General Power of Attorney (GPA) can be revoked at the will of the principal. The revocation may be express or implied. For example, the GPA is revoked if you as the principal directly administer or manage the business or property subject of the General Power of Attorneyappoint a new agentexecute a Revocation of the General Power of Attorney and publish the same in the newspaper of general circulation to notify third parties who may have acted in good faith and without knowledge of the revocationexecute a new Special Power of Attorney that is the subject of the General Power of Attorney However, a General Power of Attorney cannot be revoked in any of the following situations: If a bilateral contract depends on the General Power of AttorneyIf the General Power of Attorney is a means to fulfill an obligation already contracted;If a partner is appointed manager in a contract of partnership and his removal from the management is unjustifiable. 3. Does a General Power of Attorney have an expiry date? How long is the validity period? The principal can set an expiry date of the General Power of Attorney, and it is valid during the period stated therein. Under Article 1919 of the New Civil Code, a General Power of Attorney is extinguished or also ends in any of the following situations: If the principal revokes the agencyIf the agent withdraws from the agencyIf the principal or agent dies, suffered civil interdiction, becomes insane or insolventIf a firm or corporation who accepted the General Power of Attorney becomes insolvent or dissolvedIf the object or purpose of the General Power of Attorney is accomplishedIf the period for which the General Power of Attorney was constituted expires 4. What happens to the General Power of Attorney when the principal dies? Generally, the power of attorney is terminated upon the death of the principal. However, the power of attorney is effective even after the death of the principal if it has been constituted or created in the common interest of the principal and the agent, or in the interest of a third person who has accepted the terms of the General Power of Attorney in his favor. This means that if parties involved in the General Power of Attorney have a vested interest, the authority survives even after the death of the principal. 5. Can I give a General Power of Attorney to my representative in the Philippines, even if I am abroad? How can I do it, and what is the process? You may execute a Consularized General Power of Attorney to your nearest Embassy or Consulate. The process is the same as getting a Consularized Special Power of Attorney. Check the process here. 6. What is the difference between a General Power of Attorney (GPA) and an Enduring Power of Attorney (EPA)? The basic difference between a General Power of Attorney (GPA) and an Enduring Power of Attorney (EPA) is that a GPA is generally terminated or ends the moment the principal loses mental capacity while the EPA continues to be valid (or endures) even after the donor becomes incapacitated. An EPA is a legal document executed by a person (called the donor) appointing another person (called the attorney) to make property and financial decisions on his behalf when the donor cannot make decisions for himself due to incapacity (mental or physical). The task in the EPA is limited to property and financial matters and does not cover authority to make personal, lifestyle, and treatment decisions. EPA is present in countries adopting the English law, such as the UK2 and Australia3. 7. What is the difference between a General Power of Attorney (GPA) and a Medical Power of Attorney (Medical POA)? The difference between a GPA and the Medical POA is on the subject of the agency. A GPA, under the Philippine’s New Civil Code, is created when a person (principal) wants to appoint another person (attorney-in-fact) to administer his or her business and affairs. A Medical POA (also called a Healthcare POA), on the other hand, is created to allow a person to designate another person to make medical decisions on the former's behalf when he or she is unable to do so due to medical conditions such as insanity, coma, dementia, or the like. Medical POA appears to be common in the US. References.