A power of attorney (POA) is essentially a way for one person to appoint another person to decide on their behalf on certain significant matters. Any natural person who has been granted power through the power of attorney is legally bound by any decisions made by the principal with regard to the matter for which the POA was given.
According to definition 1A of the Power of Attorney Act of 1882, any document appointing a particular person legally referred to as an attorney to serve for the executor or on behalf of the principal is considered a power of attorney (POA).
Although the power of attorney is typically revocable, there are also irrevocable POAs. However, in most circumstances, the use of a power of attorney is restricted to situations when complicated legal issues arise. The law specifies specific steps that must be taken in order to cancel or revoke a power of attorney.
Circumstances under Which the Power Of Attorney May Be Revoked
The ability to revoke or terminate an individual or general power of attorney is granted in a variety of circumstances. However, there are no specific guidelines or laws for revoking a power of attorney in India’s contracts or power of attorney laws. As a result, the courts have established the conditions under which a power of attorney may be revoked or terminated. The power of attorney may be revoked in the following ways:
By the Acts of the Principal
There are many situations in which the principal can revoke and terminate the principal-agent relationship. The principal can revoke the power of attorney in the following cases:
- Principal on his own will can express revocation of power of attorney.
- When the subject matter for which the power of attorney was made has ended.
- In the case when the POA agent becomes bankrupt or insolvent.
- If the POA agent becomes unsound mind.
Breach of Agreement
If a POA agent acts grossly negligently, in violation of the terms of the agreement made, or outside the scope of his or her authority or powers granted by the principal, then the principal may revoke the power of attorney. In these circumstances, a declaration or notice of revocation may also be used to revoke an irrevocable power of attorney. The principal may also ask a court of appropriate jurisdiction to withdraw this irrevocable power of attorney, if necessary.
Conditions That Prevent the Power Of Attorney from Being Revoked
If the authorised POA agent has a stake or interest in the subject matter of the power of attorney, the principal cannot cancel the power of attorney without the POA agent’s approval. According to Section 202 of the Indian Contract Act, if the agent gains an interest in the subject matter of the power of attorney, the principal cannot revoke the power of attorney because doing so would be detrimental to the agent’s interests.
Procedure for Revocation of Power Of Attorney
The procedure for revocation or termination of a power of attorney is given below:
- The principal is required to produce a certificate or declaration revoking the power of attorney. The certificate or declaration must specify the grounds for the revocation of the POA and should also include the date on which the revocation took effect and the effects of such an action or revocation.
- To begin the revocation process, the aforementioned certificate or declaration notice of revocation must be properly delivered to the agent in order to proceed with the further revocation process.
- The abovementioned certificate or declaration of revocation should be published in a local or national newspaper to inform those with whom the agent is dealing or communicating on behalf of the principal that the powers given to the POA agent are now revoked.
- The same body that registered the power of attorney must also register the revocation or termination of the power of attorney.
- A copy of the revocation certificate or declaration of the power of attorney should be duly sent to the authorised POA agent to inform him that the revocation of the power of attorney has been registered legally.
- A newspaper publication of the registered revocation certificate must be made in order to notify the public that the power of attorney has been revoked.
- To stop any activity or transaction with the POA agent, copies of the POA revocation certificate or declaration may also be given to those whom the agent has dealt with on the principal’s behalf.
The power of attorney shall terminate or be revoked automatically in the event of the death, insanity, or bankruptcy of the individual, principal, or POA agent, or where the primary purpose of the power of attorney has ceased to exist.
As a result, it can be said that a power of attorney, once registered, might be cancelled under a variety of circumstances. One of these scenarios is the end of the connection or relationship between the principal and the POA agent. The process for cancelling or revoking the POA has not been mentioned in any Indian laws or acts, but the court has established the conditions under which a power of attorney may be revoked or terminated. A notice of revocation may also be used to revoke an irrevocable power of attorney.
Read Our Article: What Is A Power Of Attorney And Why Is It Important?