My company needs to sign a power of attorney
- the POA must be signed by a director (in the presence of a witness), two directors, or a director and a company secretary
- the director etc must not sign the POA before they see the notary
- the director etc will need to sign the POA in the presence of the notary
- the company will normally need to show how it authorised the signing of the power of attorney (such as by a resolution of the board of directors)
- if the company has received any instructions from the person, lawyer etc who provides the POA to the company, then the company should pass them on to the notary. The instructions often contain instructions on how the POA needs signing and what the notary should do.
Other essential things you need to know when you use a notary
In all the notarial work I do there I things I have to do including:
- usually preparing a separate document (called a ‘notarial certificate’) which I attach to the document you sign, and then I bind that certificate to the power of attorney and add my signature and seal (What does notarial certificate contain?)
- recording the details of what I have done in a register (Why do I have do this and what does it involve?)
Some things to check before signing the POA
Here are few things to check before an appointment:
- does the document:
- state the full name of the company (and its company number and registered address)?
- state the correct place of incorporation (such as if its registered office is in England and Wales, that it is incorporated in England and Wales and not that it is incorporated in the United Kingdom)?
- for the names of people, use their (full) names as stated in the persons’ passports/ID documents and are any dates and numbers from passports/ID documents correctly recorded;
- state data or facts correctly?
- if the POA is a standard form, are all the “blanks” completed in the document?
- does the company know the person to whom it is giving the power of attorney? If it does not, or have never met them, has it carried out any checks regarding the proposed attorney?
Board resolution and the power of company directors to sign documents
A UK company director generally has wide powers and authority to act on behalf of her/his company. Normally, s/he does not need to be authorised to act on behalf of or bind a company.
However, there are several practical reasons why a board resolution is required when a power of attorney needs signing, including:
- the powers of a director of a company in another country is often more limited than those in the UK
- the lawyer/person/organisation wanting the power of attorney will expect that the company who is to sign the power of attorney can show that it agreed:
- to enter into a transaction/matter etc; and
- to authorise someone to sign the power of attorney (such as the power of attorney)
- in some other countries, who is authorised to sign on behalf of a company appears on an official register
- in the UK there is no public register showing who is authorised to sign documents on behalf of a company
- that without (sometimes extensive) checking, it may not be be easily discoverable whether there any limitations on what a particular director may be able to do so or not do. For example, a director’s powers may be restricted:
- under a shareholders agreement; or
- pursuant to previous board resolutions
For some companies organising a board meeting to pass a board resolution to authorise the signing of a power of attorney in a particular instance can be difficult to arrange. This is not always a case, particularly if its articles of association are fairly modern. If so, and if there are not too many directors, it is possible to pass a board resolution in writing (such by an exchange of emails) as long as all the directors are contactable and respond in a timely fashion.
The alternative to passing a specific board resolution to authorise the signing of a specific power of attorney is for the company to put in place a board resolution which generally authorises one or more directors to sign documents such as power of attorneys (whether in relation to a specific transaction/matter or more generally in relation to the company’s affairs).
What is a power of attorney?
Simply, it is a document where the company provides permission for someone else to do something on behalf of the company.
A power of attorney can provide permission to do one or more specific things. Or sometimes the power of attorney is giving permission to someone else to do things on behalf of the company without saying exactly what they are.
Some essential legal terminology
A power of attorney often use particular words (which are sometimes used in other countries as well).
The following provides a basic guide as to their meaning:
- Doner: This is the company giving the permission
- Attorney: This is the company to whom the permission is given to do things on behalf of the donor
- Deed: In England a power of attorney, in order to be valid, must be signed as a deed to be valid. Such a requirement is not present in many other countries. In essence a document to be a deed must comply with two things:
- the document must either state:
- it is a deed; or
- it is signed as a deed; and
- it must be signed by a director (who must sign in the presence of a witness), two directors, or a director and a company secretary.
- the document must either state:
Why a power of attorney needs signing as a deed
For the reasons why a document labelled a “power of attorney” needs signing as a deed, although it is for use in another country, see the attached document. It explains the legal reasons as well as the guidance given to notaries as to why this is necessary.
In most cases a power of attorney is provided to a client with the power of attorney originating from the destination country and drafted in accordance with the requirements of the destination country. It will invariably not contain the words necessary to make it a deed. Often all that is necessary is to add wording such as:
Executed and delivered as a deed by [name of company] acting through a director.
If the power of attorney is provided in the language of the destination country, then this wording will need translating into that language.
If a lawyer from the destination country is involved, it is advisable to check with her/him about adding these words (whether or not they need providing in the language of the destination country). Usually, in my experience, I have not had problems with lawyers in other countries about adding these words.
Last updated: 06 January 2017
Unless someone is authorised to sign on behalf of a company. That is the company has authorised the person and has done so (in compliance with section 47, Companies Act 2006). This is rare. ↩
Both these need to be done, usually only once. For a company, this will involve obtaining documents available from the Registrar of Companies, including a certificate of good standing, and also, where appropriate, inspecting the company’s records (minute book). ↩
For example, if the attorney is a lawyer, will the company carry out a check that s/he is a practising lawyer? ↩
Or that the notary has carried out checks that the director signing is authorised to do so. ↩
For example, in Germany who is authorised to sign is recorded on the equivalent of the Registrar of Companies. ↩
In practise access to documents such as shareholders agreements can be difficult to obtain (as they might contain sensitive commercial information). The time taken to examine minute books, shareholders agreements and other documents may not be cost effective if there are a large number of documents to inspect, or a client is reluctant to pay for the notary to carry out such an inspection. This all assumes that the records of the company are easily accessible or properly maintained. ↩
For example, a subsidiary of a large multi-national group of companies may have to follow the policies and procedures of the group. And matters for the board of directors are considered only at fixed intervals, and only after passing through several layers of internal and external counsel and administrative departments. ↩
For example, if a client company is forming a subsidiary in another country it may pass a board resolution approving the creation of the subsidiary. One of the matters that the resolution can deal with is that one or more directors are authorised to sign any documents that need signing in order to put into effect the creation of the subsidiary. ↩
For example, for some countries (such as Spain), the normal power of attorney that a person will sign is might the attorney in that country permission to buy any property at any price and on what terms and conditions the attorney decides, etc. ↩