What limitations does the principal have on the agent?

What limitations does the principal have on the agent?

Both in a general power of attorney and in a special power of attorney, there are certain limitations that the principal has on the agent and legal requirements that must be met. Although the principal has the power to grant powers and confer authority to the agent, this does not imply that he can do absolutely anything without restrictions. Some important limitations and considerations are as follows:

• Scope of power: The principal must clearly specify the limits and scope of the power conferred. This implies indicating the specific powers and actions that the agent is authorized to perform on behalf of the principal. If no limitations are established, it is considered a general power of attorney with broad powers.
• Legal representation: Powers cannot be granted to carry out illegal acts or acts contrary to the law. In addition, certain legal or judicial matters may require the representation of a specific attorney or solicitor.
• Will of the principal: The power must be granted voluntarily and consciously by the principal. If it is shown that the power of attorney was granted under duress, deceit, or a lack of ability to understand the consequences, it could be challenged.
• Registry and good faith third parties: In some cases, it is necessary to register the power of attorney in a specific registry so that it is fully valid before third parties. If the power of attorney is not registered and a third party was not aware of its existence, they may not be required to acknowledge it.

It is important to bear in mind that the principal may revoke or modify the power of attorney at any time, as long as it complies with the established legal requirements.

For example, Maria owns a company and needs to travel for a while. She grants a power of attorney to her sister Ana to manage the company in her absence. However, Maria states that Ana can only buy supplies, not sign contracts or take financial risks. The power of attorney is limited to the period of the trip and Maria can revoke it if necessary. Ana must make decisions that benefit the company and comply with the laws. If Ana acts contrary to these limitations, the power of attorney could be revoked or have legal consequences.

Related concepts

• Good faith.