Dear Sir,
Such POA is not valid. It must be by the person who is presently acting as Director. Powers under POA cannot be delegated to another individual.
Is a Power of Attorney valid if the person it was assigned to retires from the company?
Dear Lawyers, My uncle (NRI) is looking to rent his Mumbai apartment to a family belonging to a government organisation. The organisation is signing the agreement with us. We have some concerns with the POA submitted by the organisation. The derictor who received the power has delegated the authority to another individual. The issue we have is that the director himself has retired a few years ago. Is the POA still valid? We also sought the Board of Resolutions for this POA but we received a response stating that it is confidential. I would appreciate it if I can be referred to anything that assures us the said POA is still valid under company Law.
Asked 3 years ago in Property Law
Religion: Other
First answer received in 10 minutes.
Lawyers are available now to answer your questions.
12 Answers
The PoA should state who us the eligible one who will sign the deal. If the government organisation has made him an authorized signatory then it's ok. A document making him the authorized signatory should exist. Then the PoA given to him would be valid.
The director has to be present. He cannot delegate. If the director has retired then he has ti have an authorized signatory document.
You are entitled to copy of board resolution
2) director cannot delegate power of attorney unless there is delegation clause in POA
3) it is necessary to peruse POA to advice further
If the Director has retired then this POA is no more workable.
Ask for fresh POA.
- The director cannot transfer the authority to another against the resolution of the company, hence you should check the resolution for the said clause of delegation of authority
- Further, as the director has already retired then that POA is not valid.
In our case, the Board of Directors through a board resolution have assigned an Executive Director the authority who has delegated the authority to a GM to sign a lease agreement. However, in the POA given to us, the Executive Director has already retired. Still, the government organisation says that the POA is valid inspite of the ED's retirement because the Company had given him powers. Even though he may have retired, the company says that we should consider the ED position and not the person who holds this position. They are also not assisting us the board resolution which empowers this POA. Is this true?
Asked 3 years ago
Well the PoA doesn't have any time limit unless revoked. Take this on affidavit that he is still holding the PoA and it hasn't been revoked.
It sounds very fishy although it is a government department and hence they may be bending the rules.
Although the PoA holder can only sign. Nobody else.
The company has given powers to the ED not anyone else.
Dear Sir/ma’am,
The POA cannot be transferred to another person against the resolutions accepted by the company.
If the director has retried the delegated POA is no longer valid.
Refer to the company resolution. The company should have given the power to the person who holds the position of ED.
Thank you
- For further assistance, you can book a consultation with me.
when a company, be it a government company or a private company, gives a POA to a person to do certain acts on behalf of the company, then first the company has to pass a board resolution authorising any person to sign a POA on behalf the company as the grantor
the company, acting through the authorised person [duly authorised vide the above board resolution] would then grant powers under a POA to a specified person
now that specified person, known as the grantee, can be any officer of the company also
thus if the grantee officer retires from the company or is no more a director, then despite that, in my view the POA would remain valid, since the POA is granted to the individual [regardless of the position which he held in the company]
it may be that at the time of granting the POA, the grantee may be a director or other officer of the company and subsequently would have retired from the company. But that does not mean that with his retirement, he would also cease to be a grantee under the POA
You also need to check from the POA whether the grantee was given the power to appoint a substituted attorney in place and instead of the grantee, to do some or all of the acts specified in the POA
a better perspective would be possible if the POA is perused by the lawyer
POA would not be valid as he no longer remains executive director
don’t give premises on rent to that organisation
the legal fact is that a power of attorney agent cannot delegate his powers to another person by executing a power of attorney deed in that third person's favor, hence the power delegated by that POA agent in favor of another agent itself was not valid, you should have pointed out that.
However if that person was an authorised representative in his official capacity of the organisation then the execution of POA deed by him to a power agent in his official capacity is valid and irt can continue even after his retirement because the official designation will remain with the organisation though the individual holding that post has resigned or retired.
However you may seek for an official copy of the resolution passed by the organisation in this regard which should be attached to the rental agreement failing which you can issue a legal notice to them intimating your decision to terminate the rental/leas agreement for not fulfilling the lawful conditions of not providing the information about the decision taken by the organisation to authorise someone to enter into such agreements.
You may discuss with your advocate and send a legal notice if necessary especially if the organisation is not cooperating
You are unnecessarily creating problems to yourself by taking unwanted details.
The company is right mentioning that the ED in his official capacity has delegated the powers to a PIOA agent hence their contention is legally valid.
Moreover you should understand the law involved in it that the POA entered into the lease agreement on the basis of the effective power of attorney deed in his favor at that time and it is a continuous process.
The rental agreement has been entered into for a stipulated period and not on the basis of the tenure of the power agent.
Therefore your doubts on this are unjustified hence you may first understand the law involved in this, and take further steps as per the conditions of the lease agreement and not on your own understanding or interpretations of law.
It has to be authorized signatory.
The POA powers can not be delegated further.
Further the Director already retired.
The director retires after your registration is valid but retired Director already ceased his powers so anything new can not be relied on that POA.
As them for new POA or authorized signatory.
government organisation cases are complicated so better be clear in start.
