There are a lot of reasons why you might consider getting a POA or power of attorney in UAE. Among the common reasons is for estate planning, so an appointed person or legal entity has the authority in handling things on your behalf without having to go to court even when you’ve become incapacitated.
Does a power of attorney in UAE expire?
A power of attorney in UAE can have a specified expiration date. It is recommended to choose this option, most especially when the POA has a limited purpose. If you need a person, for instance, to handle your real estate closing when you’ll be unavailable, creating a limited power of attorney in UAE for the specific purpose will mean that it will end when the transaction is completed. In such case, you can also put in detail the date of expiry of the document, which is shortly after a closing date.
When people are creating POAs in UAE for estate planning, in particular, it doesn’t make sense to add an expiry date. If you choose to create a durable type of power of attorney instead of the limited one, it’ll be valid until you revoke the document or pass away.
Read more: All You Need To Know About Lasting POA
Does a power of attorney in UAE trump a will?
We often hear the concern from people considering a power of attorney that they already have wills and testaments, and they’ve appointed an executor. Of course, you would not want to cause some confusion as to who has the authority in acting for you. A will you make has controls on who is going to act on your affairs for you should you pass away. The person or legal entity you appointed as the executor won’t be able to act for you until you pass away or the court appoints the individual or legal entity in acting on your behalf.
Does a power of attorney cease at death?
POAs in UAE lose all the authority they confer to the authorized persons or legal entities by the time the principal or person authorizing dies. Should you pass away, your executor will be the one who will handle your affairs as per the instructions in your will and testament. In many instances, we’ve seen people continuing in acting under POAs even when the individuals who appointed them have died. It is important to remember that this is not only inappropriate, but it is also illegal. The authorized person in a POA in UAE no longer has legal authority.
The person who is serving as the agent with a POA has to cease all actions that are under the document. If an agent or authorized person continues in acting under a POA, it is possible for him or her to face criminal charges.
You should know: Power Of Attorney Abuse
Can an authorized person do anything under a power of attorney in UAE?
By law, agents or authorized persons that are under POAs have an overriding obligation, referred to as the fiduciary duty, in making financial decisions which are in the principals” best interests.
Legal documents such as powers of attorney don’t grant full rights regarding the assets of the principal. Based on the fiduciary obligations, even when a principal says the agent has the power does not automatically mean the agent has the right. The right in acting will be based on the fiduciary circumstances. Should an action of the agent not in a principal’s best interests, notwithstanding that the agent has the authority in acting, the agent doesn’t have the right in acting.
It is important for people bound by a power of attorney in UAE to understand that the fiduciary obligation isn’t stated anywhere in the document. It does not have to be in it as it’s already implied by the local legislation. Fiduciary obligation is the aggressive restriction that’s placed on an agent under a POA in order to provide the principal sufficient protection. People often hesitate towards securing a POA as they fear agents will mismanage assets they own and their personal affairs. Legally, the agent is not allowed in doing anything that’s not within your best interests.
Remember: always be careful!
This is a two-fold warning. When creating a POA in UAE, you should commission a professional to help you ensure your legal document will be considered legal and valid in the eyes of the law. Also, you need to be very specific regarding who you want to appoint and what authority is covered and granted onto your agent. Without professional guidance, it can be very easy to make mistakes and get your own self into some trouble with a generalized power of attorney.
Manal Elysyed carries with her an extensive experience of 20 years across a full range of notarial and legalization matters. It is this experience that helps her in delivering the right notary solutions to clients from diversified industries.