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Introduction
A Power of Attorney is one of the important legal documents under the laws of Ghana that permits one person or institution to lawfully act through another. For clients, it offers convenience and continuity. For lawyers, it raises important questions about authority, liability and third-party rights.
In Ghana, Powers of Attorney are regulated by the Powers of Attorney Act, 1998 (Act 549). This article explains the legal foundation, uses, types, validity, revocation and legal implications of a power of attorney in simple terms.
Understanding a Power of Attorney
A Power of Attorney is a legal instrument by which a person or an entity (known as the Principal or Donor) authorizes another person (known as the Attorney or the Donee) to act on their behalf. Where the Attorney acts within the authority granted, the law treats such acts as though the Principal performed them personally.
Individuals and corporate bodies may grant a power of attorney. A person may grant same to another individual, a group of people, a company, or a trustee. In the same way, companies may issue powers of attorney to individuals or to other corporate bodies.
The scope of a power of attorney depends entirely on the wording used in the document. For that reason, a power of attorney must be clearly drafted and carefully examined before it is executed.
Purpose and Types of Powers of Attorney
A power of attorney is commonly used when the Principal is unavailable, incapacitated, or simply wishes to delegate authority. It may allow another person to represent the Principal in court, manage finances, execute documents, conduct business or deal with property amongst many other uses.
Generally, there are three types of powers of attorney recognized under the laws of Ghana.
A Special Power of Attorney is created for a specific purpose such as representing the Principal in court, selling a land or signing particular documents on behalf of the Principal.
A General Power of Attorney grants broad authority and allows the Attorney to manage nearly all the affairs of the Principal.
An Irrevocable Power of Attorney arises where the Attorney has interest in the subject matter of the Power. The Principal in this situation cannot revoke the power of attorney without the Attorney's consent as long as the interest continues to exist.
Validity of a Power of Attorney
For a power of attorney to be legally valid, it must be properly executed in accordance with the laws of Ghana.
The power of attorney, if signed by the Principal must be attested to by a witness. However, if it signed on behalf of the Principal, it must be attested to by two witnesses all in the presence of the Principal.
It must also be sealed and stamped by the appropriate institution or office. Depending on the use of the power of attorney, it must also be registered with the appropriate registry.
Revocation and Liability
A power of attorney may be revoked by the Principal at any time, unless it is an irrevocable power of attorney. It may also be revoked upon the death of the Principal or Attorney, upon the expiration of the fixed duration stated in the power of attorney or upon the bankruptcy or insolvency of the Principal.
The revocation of some powers of attorney must also be registered in the appropriate registry.
The Principal is legally bound by the acts lawfully performed by the Attorney within the scope of the power of attorney. However, where the Attorney acts outside of the authority granted, acts dishonestly or continues to act after revocation, the Attorney shall personally incur any resultant liabilities.
The law also protects Attorneys and third parties who act without knowledge that a power of attorney has been revoked. In such circumstances the liability continues to rest on the Principal. However, where an Attorney knowingly deceives a third party after revocation to the detriment of the Principal, that conduct constitutes a criminal offence and attracts the penalties including the payment of a fine or to imprisonment.
Conclusion
A power of attorney is a legal instrument and must be treated as such. Every principal should clearly understand the nature and scope of the powers being granted, the duration for which those powers will subsist and the manner in which they may be revoked. Equally, an Attorney must appreciate the extent of the authority conferred, the limits placed on its exercise and the fiduciary responsibility owed to the principal.
Legal advice should always be sought before executing, acting or relying on a Power of Attorney.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
