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Ramesh (-)     01 February 2010

Power Of Attorney / Principal

Dear All,

I have few questions regarding POA.

If I execute a General POA in favour of a person, without any monetary consideration, for a specific property, do I have a right (as a PRINCIPAL) to sell the property to someone without informing the agent or revoking the POA?

Follow-up question: If the Power agent gets into a sale agreement without my knowledge, in the meantime, if I execute and register a sale deed to another person for the same property(with the powers of being a PRINCIPAL), who is the legal owner of the property.

I would appreciate your quick clarifications. Thanks to the forum.



Learning

 10 Replies

N RAMESH. (Advocate Chennai. Formerly Civil Judge. Mobile.09444261613)     01 February 2010

//Do I have a right (as a PRINCIPAL) to sell the property to someone without informing the agent or revoking the POA?//

Yes you can. But before your agent has acted upon the power. You must immediately inform the agent that yourself has carried out the purpose of agency.

 

//If the Power agent gets into a sale agreement without my knowledge, in the meantime, if I execute and register a sale deed to another person for the same property(with the powers of being a PRINCIPAL), who is the legal owner of the property.//

Your agent has authority to enter into sale agreement. It is deemed that you as principal has entered into agreement for sale. Therefore, imagine a situation wherein, you have entered into sale agreement as well sale deed.

It is to be seen which is prior in point of time. The party holding the sale agreement has a right to seek specific performance to enforce sale agreement. 

subhash kumar (advocate)     01 February 2010

without cancellation of GPO you can not make sale deed , if the GPO holder already made a agreement or  sale deed , same shall be  valid , and later will be invalid

Ramesh (-)     01 February 2010

Dear Mr.Ramesh,

Thank you for your reply.

In this case, the POA was executed only for 50% of the undivided share of the property. The agent has executed a sale agreement for this part only. Whereas, the property sold via sale deed by the principal is less than the remaining 50%, NOT as undivided share, but with specific dimensions, boundaries and location. I would appreciate if you can advise the implications in this case.

Best Regards

N RAMESH. (Advocate Chennai. Formerly Civil Judge. Mobile.09444261613)     02 February 2010

As already asked, the date of sale agreement and date of sale deed are required.

Whether the principal has right to entire property or to 50% UDS of the property.

Ramesh (-)     02 February 2010

Dear Mr.Ramesh,

Pls find the facts below:

1. The principal has given the POA without any consideration amount, around 6 months back

2. He has execute the sale deed, for a specific part of the total area (but less than 50%, not as undivided share)  in Jan 2010

3. The sale agreement date is not known, as it is not revealed, BUT it is NOT registered. So, the same was not appearing on the EC for the buyer. Is an unregistered sale agreement valid in this case?

Regards

Ramesh (-)     02 February 2010

Dear Mr.Ramesh,

Just to one more point to my previous post, the Principal has 100% ownership of the property, of which he has given the POA for only 50%.

Regards

N RAMESH. (Advocate Chennai. Formerly Civil Judge. Mobile.09444261613)     02 February 2010

//1. The principal has given the POA without any consideration amount, around 6 months back//

No consideration is required for execution of POA. If consideration is shown, it requires to registered as conveyance deed. Further agent is entitled to salary for the work done and not consideration.

//3. The sale agreement date is not known, as it is not revealed, BUT it is NOT registered. So, the same was not appearing on the EC for the buyer. Is an unregistered sale agreement valid in this case?//

Sale agreement is not required to be registered. Nevertheless it will be valid and enforceable.

As per the facts given by you,

-The Principal has 100% ownership of the property, of which he has given the POA for only 50%. Principal is owner in respect of entire property.

-The POA was executed only for 50% of the undivided share of the property. The agent has executed a sale agreement for this part only.

-Whereas, the property sold via sale deed by the principal is less than the remaining 50%.

Therefore sale agreement is valid and enforceable as the agent has authority to enter into sale agreement.

The sale deed is valid as the owner sold this remaining share of the property. 

1 Like

Ramesh (-)     02 February 2010

Dear Mr. Ramesh,

Thank you very much for your prompt replies. I really apperciate it. One more clarification please regarding your last sentence "The sale deed is valid as the owner sold this remaining share of the property". I would like to clarify again that even though the owner sold less than 50% of the property, he executed the sale deed with specific boundaries and not as undivided share. Basically, the total property comprises of  two plots of different sizes and the owner sold the smaller plot specifically mentioned in the schedule. Does this make a difference? Is the sale deed still valid?

Regards

Ramesh (-)     06 February 2010

Dear Sir,

The update is that the Principal has revoked the power of attorney citing "Agent is not trustworthy and he has misused the power given to him also has not followed as per the terms and conditions of the PoA." Principal had not taken consideration for giving PoA.  Also mention the PoA is under irrevocable clause. I request your clarification whether this revocation is legal.

Best Regards

Rajendra Kumar (self employed)     24 February 2010

In my view if the General Power of Attorney is given without any consideration then the attorney can only execute sale deed and he can not receive consideration in his name unless it is specified in the POA. If he receives consideration in the name of principal then he has to deposit the same in the bank account of principal only. At this point of time it will in the knowledge of principal and he can act accordingly. In general the attorney has to receive consideration in the name of principal only. Therefore it is also to be seen that whether power of attorney holder has a right to receive consideration in his/her name. A further question will arise while registering the sale deed signed under power of attorney regarding stamp duty. Because in case of consideration is received by the attorney then the stamp duty will be charged on the fair market value of the property transferred under POA. But if the attorney has been power only to execute the sale deed then the POA can be executed on stamp paper of Rs. 500/- for registration. I think this will answer to various queries regarding sale by attorney without the knowledge of principal.


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