Can a power of attorney be cancelled?
A power of attorney (POA) is a legal document in which a grantor, known as the Principal, bestows unique powers on another person, known as the Agent or Attorney, to act in a certain manner as specified in the POA. This article is about Cancellation of power of attorney format .
These rights are given to an agent by the principle due to health concerns or to ensure that legal, financial, or real estate transactions are executed in an undeniable manner.
Before you have an unexpected illness or accident, it is always a good idea to put someone in a position where they can manage your property and finances.
The Power of Attorney Act, Indian Contract Act, Registration Act, and Indian Stamp Act are the numerous statutes that govern power of attorney in India (including the corresponding state-level acts).
However, the question arises as to whether we can rescind these rights once they have been conferred. Can a Power of Attorney be revoked, reverting all powers granted to an agent to the principal?
The answers are yes to both of these queries. The principal can revoke a power of attorney at any time. However, when preparing the power of attorney form, a language that clearly specifies that the power of attorney is not revocable at the principal’s will can be included. If the POA does not include such a clause, the principal has the ability to cancel it at any moment, and the agent can no longer act on behalf of the principal after the POA has been revoked.
Irrevocable power of attorney can be created if the document has an irrevocability provision, which states that the principle has no capacity to revoke the power of attorney or that the principle waives the right to withdraw the power of attorney. However, because they are confined to certain objectives, irreversible powers of attorney are rarely used.
What are the causes for the Power of Attorney being revoked?
As previously stated, the principal can revoke the Power of Attorney at any time, but have you ever questioned why someone would revoke the powers they were granted? There are a variety of causes for this inquiry, which vary from person to person. The following are some of the reasons:
- The principal has trust concerns with an agent and does not want him or her to carry out the Power of Attorney’s functions because he or she is untrustworthy. In this instance, the Power of Attorney can be promptly revoked.
- Things are growing more commercial and intricate as time passes, and the chores are becoming more heavy, particularly legal ones that are tough to do by one person. As a result, the Power of Attorney is revoked, and the rights are transferred to someone else who can effectively handle all problematic situations.
- Specified Powers of Attorney, which are created for specific objectives and are completed when those purposes have been met, can be revoked at any moment.
- Personal biases and political intervention might cause the principal’s Power of Attorney to be revoked and the principal’s rights to be transferred to another individual.
When is it possible to cancel a Power of Attorney?
Though neither the Indian Contract Act nor the Power of Attorney Act specifically address the cancellation of a Power of Attorney, the courts have interpreted the general rules for applying the scenarios to revoke the PoA from time to time. As a result, the Power of Attorney can be revoked:
1. By a Principal’s act
The principal-agent relationship can be ended by the principal at any time for a variety of reasons. When the agency’s business is completed or the purpose for which the instrument of PoA was created is fulfilled, when the principal cancels the PoA with his authority, and when either the principal or an agent, or both, becomes insolvent, of unsound mind, or incapacitated to carry on the Power of Attorney are just a few examples.
2. When the Agent is interested in working for the agency
Section 202 of the Indian Contract Act, 1872, states that if an agent has a personal interest in the agency’s subject matter, the agency cannot be terminated without an express contract or the agent’s consent.
3. An agent’s breach of contract
The Power of Attorney is initially irrevocable, however it can be removed in the event of extreme mismanagement on the part of an Agent. When an agent fails to comply with the terms of the contract or acts beyond the scope of the contract’s powers, the principal can revoke the powers assigned to him at any moment by cancelling the Power of Attorney.
Procedure for Cancellation of Power of Attorney
To revoke or cancel the Power of Attorney in the perspective of the law, several measures must be taken in a specific order. The steps are as follows:
- To cancel the revocable Power of Attorney that is notarized by a certified notary advocate, first send a letter or a deed of revocation to the appropriate authority. The reason for the revocation, the effective date of the revocation, and the repercussions should all be stated in the letter of revocation.
- To give the Attorney or Agent a sufficient opportunity to present in the revocation proceedings, a notification of this letter of revocation should be duly served on them.
- Additionally, the notice of revocation should be published in a local or national media so that everyone who has dealt with the Attorney or the public in general is aware that his or her powers have been revoked and that he or she will no longer represent the principle.
- The same authority who registered the Power of Attorney, i.e. the registrar or sub-registrar, shall register the letter of revocation or deed of revocation.
- After the letter of revocation has been registered, a copy should be sent to the Attorney and any other people with whom he or she has been in contact so that they are aware of the situation.
In the case of an irrevocable Power of Attorney:
which is difficult to revoke, particularly when an agent or attorney has an interest in the subject matter, the same can be cancelled in the event of an attorney’s breach of powers. If this occurs, a notice of revocation can be filed against him, and in rare situations, a court of sufficient jurisdiction may be contacted to seek such revocation.
In the case of a durable Power of Attorney:
it will be automatically revoked in the event of the principal’s death, insolvency, incompetence, or insanity, or both.
What makes a Power of Attorney Revocation valid?
A Revocation of Power of Attorney must say unequivocally that the Power of Attorney is withdrawn and include the following information:
- The name of the principal
- The name of the attorney-in-fact
- The effective date of the Power of Attorney
- The revoked Power of Attorney’s date
The principal must comply with the following requirements in order for their revocation to be valid:
- Obtain a notary’s signature on the revocation.
- Give their attorney-in-fact a copy of the Revocation (and ask them to return any copies of the Power of Attorney)
- Any third parties (such as a bank) who may have used the Power of Attorney should receive a copy of the Revocation.
- Any entity where the Power of Attorney was recorded, such as the County Clerk or Land Titles Office, should get a copy of the Revocation.
What is the procedure for preparing a cancellation deed?
- The Principal’s name (the person who gave the Attorney his rights) in the same spelling and format as the previous deed.
- The date on which the Power of Attorney deed is being revoked.
- The name of the Attorney to whom the power in the earlier deed was granted.
- The date on which the revocation or cancellation took effect.
- You can also go into detail about the type of power that was granted and why it was revoked, however this isn’t required.
In certain states, power of attorney registration is required, while in others, it is optional. This is subject to ongoing revisions in accordance with specific government regulations, and it varies from state to state. As a result, the general methods for making the Revocation of Power of Attorney legally effective may differ slightly depending on the state in which it is made.
- Drafting – On a Stamp paper of sufficient value, first draught the deed, indicating the Principal, Attorney, date of previous deed, cancellation date, and registration details such as date of registration, place, name of Sub-Registrar office, and Deed number, among other things.
- Always submit a written notification to the Attorney notifying him of the cancellation.
- Registration — If the Power of Attorney deed was registered at a Sub-registrar office, the Revocation Deed must be registered in the same registrar office to prevent any Attorney misconduct. In addition, a written notice of the revocation must be submitted to the Attorney.
- The Revocation Deed does not need to be recorded if the Power of Attorney deed was not previously registered. It can be written on plain paper, notarized, and sent to the Attorney as a copy.
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Q.1 Is it possible to remove a Power of Attorney if the principal is incompetent?
If the principal is proven to be incompetent, the ordinary power of attorney automatically expires (meaning they are mentally incapacitated and not capable of making their own decisions).
Even if the principal is mentally disabled, a Durable Power of Attorney continues in effect. As a result, selecting a reliable and capable attorney-in-fact is critical.
Q.2 Why is it necessary to withdraw a Power of Attorney in writing?
A Revocation of Power of Attorney is no exception to the rule of getting legal papers in writing as evidence of their existence and terms.
Furthermore, third parties (such as a bank or insurance company) typically require documentation that a Power of Attorney has been revoked and, in some cases, may allow the attorney-in-fact to continue acting until the revocation is written down.
Q.3 When Can I Revoke A Power Of Attorney That Was Issued Previously?
You have no time limit on when you can revoke a POA. The Grantor has the authority to rescind the power whenever he thinks proper. It is prudent to revoke the POA if you believe you will become incompetent in the near future or if death is impending, unless the POA previously issued was of a Durable type and you wish it to continue. The Grantor is not obligated to provide any justification for your decision to revoke the power.
Q.4 What happens if the Attorney continues to exercise his authority after being notified of the revocation?
When the Attorney receives notice that the deed granting him powers to act on behalf of the Principal has been cancelled, he is no longer entitled to employ those powers. Regardless, if he acts on behalf of the Principal, the Principal may pursue legal action against him. Furthermore, the Principal will not be liable for any actions taken after receiving notification of revocation.