- Introduction
- The power of attorney
- Contemplatio domini
- The types of power of attorney with reference to the powers of the representative
- What to pay attention to
Introduction
It frequently happens that one of the parties or even both, for a wide variety of reasons, cannot or do not want to be present in the flash when a legal act (or contract or notarial deed)is concluded.
This often happens in real estate purchases especially when the buyer, the seller or both are foreign citizens (as we saw in the article How to buy a property in Italy: the special power of attorney – The Legal Nook (antonellolawfirm.com)).
But it can happen in any other circumstance.
In these cases, the power of attorney proves to be a very useful tool to enable the deal to be reached smoothly.
Before going on, it is useful to specify that the power of attorney is also known in some foreign countries as proxy.
The power of attorney
The power of attorney is a unilateral recetive transaction by which one person (represented) grants another (representative) the power to represent him or her.
In other words, with the power of attorney, the represented person confers to the representative one the power of representation.
The purpose of the institution is to enable one person to be substituted by another for the conclusion of a legal act or several legal acts.
The power of attorney also has the function of making it known to third parties that the representative has been authorized to act on behalf of the principal.
Contemplatio domini
When speaking of power of attorney one may also come across the Latin term “contemplatio domini”.
Under article no. 1388 of the Italian Civil Code, which regulates so-called direct representation, when a contract is concluded by the agent in the name, in the interest, and on the behalf of the principal, and within the limits of the powers conferred by the power of attorney, the effects of the legal transaction concluded by the principal are produced directly in the legal sphere of the principal.
The form of the power of attorney
Generally speaking, the principle of freedom of form applies in the Italian legal system.
However, it should be specified that, under the article no. 1392 of the Italian Civil Code, the power of attorney has no effect unless it is given in the same form prescribed for the contract to be concluded by the representative.
Therefore, in the case of transfer of rights in rem on real estate (e.g. for a real estate purchase), the power of attorney must be in the same form as prescribed for the deed of transfer, and thus the written form either notarized private writing or public notarial deed.
The form of the power of attorney
Generally speaking, the principle of freedom of form applies in the Italian legal system.
However, it should be specified that, under the article no. 1392 of the Italian Civil Code, the power of attorney has no effect unless it is given in the same form prescribed for the contract to be concluded by the representative.
Therefore, in the case of transfer of rights in rem on real estate (e.g. for a real estate purchase), the power of attorney must be in the same form as prescribed for the deed of transfer, and thus the written form either notarized private writing or public notarial deed.
The types of power of attorney with reference to the powers of the representative
With reference to the powers conferred on the representative, three types of power of attorney can be distinguished:
- special power of attorney: for a specific and determined affair. The power of the representative is exhausted by the performance of the individual act;
- general power of attorney: power to perform in the name and on behalf of the principal acts of ordinary and extraordinary administration. The principal may also decide to modulate the extent of the power conferred;
- generic power of attorney: power to perform all acts of ordinary and extraordinary administration but with reference to a specific area.
What to pay attention to
Power of attorney is an instrument of undeniable usefulness and practicality that allows for easier conclusion of contracts and legal acts or deeds even when the parties are not present in person.
In any case, it is always necessary to make a proper assessment regarding the specific case and the purpose of the power of attorney in order to correctly determine the steps to be taken. Some of the most important decisions concern the type of power of attorney to be used, the correct data entry, the clear definition of the powers given to the representative and their possible limitation, the presence of a potential conflict of interest, and many other factors.
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