This is part 1 of the Power of Attorney series which is covered by ilaan.com. In this article, we will provide detailed guidelines about all the legal aspects of Power of Attorney.
Giving Power of attorney to someone is one of the most important and sensitive processes to follow. It’s both beneficial and risky at the same time for people who own any property in Pakistan and want someone including legal attorneys, relatives, or any third person on their behalf to take certain legal actions in terms of selling or lending that particular property on a rental basis.
To make this process secure and accurate, the Government of Pakistan has introduced many laws and regulations involved in the grant of authority to another person. In this article, we ensured all the necessary information from scratch to upgrade your knowledge about POA in Pakistan.
Being proactive in legal situations is wise, thus this article was created to provide a suitable primer and teach readers how to navigate this difficult but crucial subject. This article series, which consists of six sections, will be your best resource if you want to learn more about the various powers of attorney available and which one best suit your needs. To get the most recent information, there are many complex queries like online POA (Power of Attorney), Overseas Pakistani POA, and many more. We will cover all these queries in our upcoming sections.
Let’s read and understand better about the Power of Attorney in Pakistan.
What is Power of Attorney?
A power of attorney is a legal document that enables one person (the agent or attorney-in-fact) to act on behalf of another individual (the principal) in specific situations or transactions. It is also referred to as a "Mukhtar Nama" in Pakistani Urdu.
The principal essentially transfers their rights and authority to the agent, giving them the ability to make decisions about purchases, sales, and rentals and to conduct acts just like the principal would. It is not only authentic to be used in a court of law but it can also be used for all legal matters, including Tax and Property related procedures (i.e., buying, selling, and renting properties in Pakistan, etc.).
How many laws are in Pakistan about POA?
Below is a table summarizing some of the key acts and laws relevant to the Power of Attorney in Pakistan:
|
Act Name |
Year |
Description |
|
The Contract Act, 1872 |
1872 |
Contains provisions relevant to the legal principles governing the relationship between the principal and the agent under a POA. Read More |
|
The Powers of Attorney Act, 1882 |
1882 |
Governs the creation, execution, and revocation of powers of attorney in Pakistan. Defines legal requirements and procedures. Read More |
|
The Transfer of Property Act, 1882 |
1882 |
Relevant when a power of attorney is used for the transfer of immovable property. Read More |
|
The Registration Act, 1908 |
1908 |
Deals with the registration of various documents, including certain types of powers of attorney that require registration. Read More |
|
Court Rules and Procedures |
- |
Different courts may have specific rules and procedures related to the submission and acceptance of Vakalatnama for legal representation. |
So, it's crucial to consult the latest versions of the relevant statutes or seek legal advice from a qualified professional that can be a Lawyer or Real Estate Consultants like ilaan.com.
Top of Form
Legal Definition of Power Attorney
According to Section 32 of the Registration Act 1908 (“Registration Act”), every document should,
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“The donee [Executant] of a power-of-attorney may, if they think fit, execute or do any assurance, instrument or thing in and with his own name and signature, and his own seal, where sealing is required, by the authority of the donor of the power; and every assurance, instrument, and thing so executed and done, shall be as effectual in law as if it had been executed or done by the donee of the power in the name, and with the signature and seal, of the donor thereof. ” Power of Attorney Act 1908. Section 32 |
According to the legal definition of the above section, it can be said that the executant i.e. the person given the authority to manage one’s property has the legal right to negotiate, execute transactions, receive and release funds, withdraw cases, submit cases, and appoint on behalf of the executant.
What are the Types of Power of Attorney?
The main three types of power of attorney in Pakistan are:
- General Power of Attorney
- Special Power of Attorney
- The legal power of Attorney
Let’s understand them.
1. General Power of Attorney
A general power of attorney (known as Mukhtar Nama in Urdu) is a legally designed document that the principal (the owner of the real estate) releases to a legal agent, or attorney-in-fact (relatives, real estate management companies). This agreement, which includes the word "general" in its name, enables the agent to handle a variety of matters (purchasing, selling) on behalf of the principal for a specific amount of time, particularly when they are unwell or away.
2. Special Power of Attorney
A Special Power of Attorney (also known as Mukhtaar Nama Khaas in Urdu) is a legal document that one (or more) people can use to designate another person as their agent to carry out particular and designated actions (which should be specifically mentioned in the Special Power of Attorney Document).
One person may be designated by multiple people as their Special Power of Attorney, and it is a common practice in Pakistan for numerous relatives—some of whom may reside abroad—to designate one dependable individual as their Special Power of Attorney. In recent years, there have been numerous reports of fraud situations where relatives have profited financially by abusing this position. So, consumers are searching for companies that offer turnkey solutions like ilaan.com, which provides all the services with unambiguous terms and conditions.
3. Legal Power of Attorney
A legal power of Attorney (known as Vakalat-nama, in Urdu) is the paperwork that tells the courts that your attorney will officially represent your interests. Each particular lawsuit, in each particular court, requires a Legal Power of Attorney.
A legal power of attorney enables a lawyer to represent you in legal affairs, but in some circumstances, you are not permitted to represent yourself (for example, in instances of giving evidence). An accreditation from their local Pakistani Embassy or Consulate is necessary for an overseas Pakistani to provide a Legal Attorney General to a lawyer or law firm in Pakistan.
Key differences between General and Special Power of Attorney in Pakistan
|
Aspect |
General Power of Attorney (GPA) |
Special Power of Attorney (SPA) |
Legal POA |
|
Purpose |
Grants broad authority over multiple matters and tasks. |
Grants limited and specific authority for particular tasks or transactions. |
Appoints a lawyer to represent the client in legal matters. |
|
Nature of Authority |
Non-legal or legal matters depending on the GPA's scope. |
Non-legal matters only, with specific limitations. |
Legal representation in court proceedings and related matters. |
|
Agent or Representative |
The agent may or may not be a lawyer. |
The agent may or may not be a lawyer. |
The representative must be a licensed advocate or lawyer. |
|
Use Case |
Can be used for various legal and non-legal matters, such as property management, financial transactions, or business representation. |
Used for specific non-legal matters, like selling property or handling financial transactions. |
Exclusively used for legal matters requiring representation in court. |
|
Duration |
Can have a defined duration or be open-ended until revoked. |
Can have a defined duration or be task-specific, terminating after the assigned task is completed or a specific period. |
Remains valid until the conclusion of the specified legal case or until revoked by the client. |
|
Revocation |
Can be revoked by the principal at any time, either after the completion of tasks or before, by issuing a revocation notice. |
Can be revoked by the principal at any time before or after the specified task's completion through a revocation notice. |
Can be revoked by the client by informing the appointed advocate and the court, but revocation during a case might require court approval and substitution of the advocate. |
|
Applicability |
Applicable for both legal and non-legal matters where broad authority is needed. |
Applicable for non-legal matters where limited authority is needed for specific tasks. |
Applicable for legal matters requiring representation by a lawyer in court or legal proceedings. |
|
Document Contents |
Specifies the broad powers granted to the agent, tasks they can perform, and the scope of their authority. |
Specifies the limited powers granted to the agent, the tasks they can perform, and the scope of their authority. |
Contains details of the client, appointed advocate, case particulars, and the advocate's authorization for representation. |
|
Legal Requirements |
May or may not require notarization or registration, depending on the local laws or specific tasks involved. |
May or may not require notarization or registration, depending on the local laws or specific tasks involved. |
Typically needs to be properly stamped, signed by the client, and may require notarization or registration, depending on the court's jurisdiction and local laws. |
It's crucial to consult with a qualified legal professional in Pakistan to understand the specific legal implications and requirements of each type of document based on your particular situation. Additionally, legal terminology and requirements may vary, so seeking professional advice ensures accuracy and compliance with the applicable laws.
How to Cancel Power of Attorney?
In case of any serious concerns, the Law of Pakistan enables the Principal Owner to move for the cancellation of the POA on an immediate basis which will be effective soon after the documentation is submitted to the court.
The initial Power of Attorney may be revoked at any time by submitting a Revocation-Deed to the appropriate registrar. There must be a newspaper publication (Akhbar Ishtihar), and it is highlighted that the cause for withdrawing the power of attorney must be included in the newspaper publication as it may later be cited (Reference 2017 CNC P48 ISB). At some points, POAs are automatically seized.
|
General POA |
Special POA |
Legal POA |
|
In the event of the principal's death, the general power of attorney is revoked. |
If the task or assignment for which the power of attorney was granted is finished, it will also be revoked.
|
A Legal POA may be revoked in the event that the client or representative dies, the attorney dies, or the matter has reached its conclusion.
|
It is important to remember that, in the case of a Special Power of Attorney only, where time duration of any specific action is declared, or any task is to be completed for example selling a property in six months. When this time will be completed or before the time the property is sold out, this Special Power of Attorney will be automatically seized, and no further action will be taken by the person given the authority (Legal Attorney, relative/ Real estate consultant). If case the Principal Owner of the property dies, this POA will be deemed as expired.
After the cancellation of the POA, is it possible to assign the rights to another person on the spot?
The authority granted to the agent would expire in Pakistan if a Power of Attorney was rescinded or revoked. The agent would lose the ability to represent the principal after the cancelation.
After terminating a Power of Attorney, the Principal may immediately transfer the rights to another person by signing a new Power of Attorney. To create a Power of Attorney that is legitimate in Pakistan, you must, however, abide by the law. According to local regulations, the procedure could involve notarization, witnesses being present, and other procedures.
How to Register a Power of Attorney in Pakistan
In general, power the registration process for POA is incredibly scrutinized, but it needs proper legal attention that includes all the documentation which should be properly submitted otherwise POA will be considered invalid. It can be canceled and, in some cases, may not even be recognized. Contrary to popular belief, a simple Stamp Form (Stamp Paper) from a Notary alone would not be sufficient, and it needs a list of documents such as CNIC, Passport, Property details, etc.
A Power of attorney document must be registered by the relevant Registrar and Notary (As observed in 2017 YLR P.138). The stamp paper would be issued by the Executant (on their name) and if the executants are abroad, then the nearest Pakistani Consulate would also attest the document.
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“2 witnesses are required for a Power of Attorney” 1998 PLD 367 |
Templates for power of attorney
Which terms are to be considered while signing any power of attorney?
It's critical to take into account a number of key clauses and components before signing a Power of Attorney (POA) in Pakistan to make sure the document is legitimate and suits your demands. When executing a power of attorney in Pakistan, keep the following in mind:
- The principal must sign the POA in the presence of witnesses or notary public to acknowledge its authenticity.
- If the Power of Attorney is intended for use abroad, it may require authentication or legalization, depending on the destination country's requirements.
- Clearly define how the Power of Attorney can be used and by whom, especially if it is intended for a specific transaction or limited use.
- Specify any conditions or events upon which the Power of Attorney will expire or terminate.
- Include a clause that allows the principal to revoke the Power of Attorney at any time by providing written notice to the agent.
- Maintain and/or operate any business that the executant owns.
- 2 witnesses are required for a Power of Attorney.
For more information about the terms before signature, click here General power of attorney terms.
Conclusion
Although, it's crucial to be aware that policies and guidelines can alter, especially when it comes to Pakistan's power of attorney. Ultimately, a Power of Attorney in Pakistan is a strong legal instrument that gives people power and trust for a variety of uses. To make wise decisions and ensure seamless transactions, it is essential to comprehend its subtleties and repercussions. With the correct information and direction, the power of attorney can be used to strengthen and protect the interests of all parties involved in judicial proceedings.
Important Information: As a result, it's essential to review the most recent editions of the pertinent statutes or get legal counsel from a licensed practitioner, such as a lawyer or real estate consultant like ilaan.com.
Stay tuned for the next series regarding Power of Attorney. We went into further detail about the departments involved in power of attorney in Part 2 of our blog series. "Power of Attorney in Real Estate in Pakistan: Departments Involved – Part 2 " would be the subject. As we anticipate Part 3, keep reading for even more thrilling disclosures and helpful advice that will enable you to comprehend the Power of Attorney.
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