Special power of attorney: Overview, definition, and example
What is a special power of attorney?
A special power of attorney is a legal document that grants an individual (the agent or attorney-in-fact) the authority to act on behalf of another person (the principal) for a specific task or purpose. Unlike a general power of attorney, which grants broad authority to act in a variety of matters, a special power of attorney is limited to specific actions outlined in the document. The principal specifies the exact powers and scope of authority given to the agent, such as handling real estate transactions, managing a bank account, or signing documents on their behalf for a particular event.
For example, a business owner might grant a special power of attorney to a trusted individual to sign a contract on their behalf while they are out of the country.
Why is a special power of attorney important?
A special power of attorney is important because it allows the principal to delegate authority for specific tasks or responsibilities without giving up control over all aspects of their affairs. It provides a legal framework for someone to act in the principal’s best interests when they are unable to perform a particular task, such as being absent, incapacitated, or otherwise unavailable. A special power of attorney can be particularly useful in business transactions, legal matters, or personal affairs where specialized expertise or availability is required.
For businesses, having a special power of attorney can ensure that key transactions or decisions are made in the principal’s absence, without the need to involve unnecessary parties or delay important actions.
Understanding special power of attorney through an example
Imagine a business owner who is traveling internationally and needs to sell a piece of real estate. The owner grants a special power of attorney to a trusted business partner, giving them the authority to sign the sale documents and complete the transaction on the owner’s behalf. The document specifies that the partner’s authority is limited to this one sale and does not extend to any other business dealings.
In another example, a person may grant a special power of attorney to a family member to handle their medical decisions if they become incapacitated, but the authority is limited to medical matters and does not cover financial or legal issues.
An example of a special power of attorney clause
Here’s how a special power of attorney clause might appear in a legal document:
"I, [Principal’s Name], hereby grant [Agent’s Name] the special power of attorney to act on my behalf in the sale of my property located at [Address], including signing all necessary documents and completing the transaction. This special power of attorney is limited solely to this transaction and shall automatically expire once the sale is finalized."
Conclusion
A special power of attorney is a useful legal tool for delegating specific authority for particular tasks or events. It allows a principal to ensure that business or personal matters are handled efficiently and legally when they are unable to do so themselves. By clearly defining the scope of authority, a special power of attorney helps protect both the principal and the agent, ensuring that the agent’s actions are legally valid and in line with the principal’s intentions.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.