Can a Power of Attorney transfer Title to Land?

Introduction:

There have been raging controversies whether a Power of Attorney can be used to transfer title to land and this controversy has even been made worse by practices adopted by several solicitors in some parts of the country where Power of Attorney is being used as a document to transfer and convey title to land.

In this article we have put forward the position of the law in line with the case of Ude v. Nwara (1993) 2 NWLR (Pt.278) p.638-664 as to whether a Power of Attorney can be used to transfer title to land to educate land purchasers as well as persons intending to engage in future land transactions for proper guidance to obtain requisite legal, proper and appropriate document validly acceptable in law to transfer title to land.

What is Power of Attorney?

Black’s Law Dictionary 7th Edition by Bryan A. Garner defines “Power of Attorney” at pg. 1191 as:

“An instrument granting someone authority to act as an agent or attorney-in-fact for the grantor”.

Power of Attorney is also termed “Letter of Attorney”.

In the case of Ude v. Nwara (1993) 2 SCNJ 47 at 66-67 or (1993) 2 NWLR (Pt.278) p.638/664 as per Nnaemeka Agu JSC stated succinctly the law thus:

“A Power of Attorney is a document, usually but not always necessarily under seal, whereby a person seised of an estate in land authorizes another person (i.e. the donee) who is called his attorney to do in the stead of the donor anything which the donor can do lawfully, usually clearly spelt out in the power of attorney. Such acts may extend from receiving and suing for rates, and rents from, to giving seisin to third parties. It may be issued for valuable consideration or may be coupled with interest. In either case, it is usually made to be irrevocable either absolutely or for a limited period.”

Thus, a power of attorney merely warrants and authorizes the donee to do certain acts in the stead of the donor and so is not an instrument which confers, transfers limits, charges or alienates any title to the donee: rather it could be a vehicle whereby these acts could be done by the donee for and in the name of the donor to a third party. So even if it authorizes the donee to do any of these acts to any person including himself, the mere issuance of such a power is not per se an alienation or parting with possession. So far, it is categorized as a document of delegation: it is only after, by virtue of the power of attorney, the donee leases or conveys the property, the subject of the power, to any person including himself then there is an alienation. See also the cases of Abu v. Kuyabana (2002) 4 NWLR (Pt.758) 599, Olorunfemi v. Nig. Bank Ltd. (2003) 5 NWLR (Pt.812) 1 In the case of Ude v. Nwara (1993) 2 NWLR (Pt.277) 638 at pg. 665 and Amadi v. Nsirim (2004) 17 NWLR (Pt.901) 111.

Categories of Power of Attorney:

The following are the categories of Power of Attorney:

(a)     General Power of Attorney which authorizes an agent to transact business for the principal;

(b)    Irrevocable Power of Attorney which is that power that the principal cannot revoke and this is also termed “Power of Attorney” coupled with interest;

(c)     Special Power of Attorney which is such power of Attorney that limits the agent’s authority to specific matter(s).

The term “Power coupled with interest” is defined as:

“A power to do some act(s), conveyed along with an interest in the subject matter of the power. A power coupled with an interest is not held for the benefit of the principal, and it is irrevocable due to the agent’s interest in the subject property. For this reason, some authorities assert that it is not a true agency power. It is also called power given as security proprietary.”

Meaning of Power of Attorney:

The word “power” is normally used in the sense of an authority given to a person to dispose of property which is not his and for the purpose of this article. See the cases of Freme v. Clement (1881) 18 Ch. D 499 at p.504; Re: Armstrong (1886) 17 Q.B.D 521. Thus, the person giving the power is called the “Donor” and the person to whom the power is given is called the “Donee”.

In the first place, the death of the principal only deprives the agent to act only in cases of revocable Power of Attorneys and not where the power is irrevocable. It is where a Power of Attorney is expressed to be irrevocable and is given to secure a proprietary interest of the donee or the performance of an obligation owed to the donee that it is irrevocable either by the donor without the consent of the donee or by the death, incapacity, bankruptcy, winding up or dissolution of the donor, so long as the donee has the interest or the obligation remains undischarged. See the cases of Reigate v. Union Manufacturing Co. (Ramsbottom) (1918) 1 K. B. 592 C. A.

Where the authority of an agent is given by deed, or for valuable consideration, for the purpose of effectuating any security or of protecting or securing any interest of the agent, it is irrevocable during the subsistence of such security or interest. See the case of Slatter v. Railway Commissioners (New South Wales) (1931) 45 C.L.R. 68. But it is not irrevocable merely because the agent has an interest in the exercise of it.

Nature of power of attorney:

By its meaning and intendment, a Power of Attorney does not convey title. Rather a power of Attorney is the authority given to the donee, to exercise certain powers on behalf of the donor. It does not transfer interest in the land neither does it alienate the land in favour of the donee no matter how flamboyantly, the contents of the Power of Attorney was drawn. It is merely an instrument of delegation of power. See Black's law Dictionary, 9th Edition and the decisions of the Court in Nwachukwu v. Awka MFB Ltd (2016) LPELR-41053 (CA); Ude v. Nwara (1993) 2 NWLR (Pt. 278) 638 or (1993) 2 SCNJ 47; Chima v. Chima (2001) 3 NWLR (Pt. 701) 527.

The Supreme Court in the case of Ude v. Nwara (1993) 2 NWLR (Pt. 278) 638 held that:

“A Power of Attorney merely warrants and authorizes the Donee to do certain acts in the stead of the Donor and so is not an instrument which confers transfers, limits, charges or alienates any title to the done rather it could be a vehicle where these acts could be done by the Donee for and in the name of the Donor to a third party...”

Can an attorney act on behalf of his deceased principal to transfer valid title to a third party?

In law, a Power of Attorney will automatically terminate upon the death of the donor unless expressed to be ‘irrevocable’ and thus the donee acts only in pursuant to the powers conferred on him by the donor in the life time of the donor and can be ratified and valid in law.

It thus neither authorizes nor covers acts carried out either after the death of the donor or acts expressly forbidden therein. In law, it is only where a Power of Attorney is expressed to be ‘irrevocable’ and the donee has offered some consideration and thus having an interest to protect in the subject matter of the power of attorney that it would continue to operate and be binding even upon the death of the donor but not otherwise.

In Chime & Ors v. Chime & Ors (2001) 3 NWLR (Pt. 710) 527, the Supreme Court had opined inter alia thus:

“It is where a power of attorney is expressed to be irrevocable and is given to secure a proprietary interest of the donee or the performance of an obligation owed to the donee that it is irrevocable either by the donor without the consent of the donee or by the death, incapacity, bankruptcy, winding up or dissolution of the donor, so long as the donee has the interest or the obligation remains undischarged.”

See also the cases of Ajuwon v. Adeoti (1990) 2 NWLR (Pt. 132) 271 at p. 292 - 294; Nwachukwu v. Awka M. F. B. Ltd (2016) LPELR - 41055 (CA); Ude v. Nwara (1993) 2 NWLR (Pt. 278) 638.

Can a Power of Attorney confer title to land?

It must be stated that a power of attorney is not an instrument of transfer in regard to any right, title or interest in an immovable property. The power of attorney is creation of an agency whereby the grantor authorizes the grantee to do certain acts specified therein, on behalf of the grantor, which when executed will be binding on the grantor as if done by him. It is revocable or terminable at any time unless made irrevocable in a manner known to law. Even an irrevocable power of attorney does not have the effect of transferring title to the grantee. So, power of attorney does not convey ownership. An attorney holder may however execute a deed of conveyance in exercise of the power granted under the power of attorney and convey title on behalf of the grantor.

In Innocent Obiora Nwankwo v. Comfort Agwuna (2007) LPELR-8445(Ca), Ogebe, J.C.A., (as he then was) opined that:

“...a Power of Attorney cannot confer title on a donee. It is a mere delegation of the powers of the donor to the donee”.

Also in the case of Okeke v. Nnolim (2015) 5 NWLR (Pt. 1453) 444 at p. 476, paras. D-E, 48, paras E-F, the court held that:

“A power of attorney being an agency document cannot stand alone on its own. Such a document only authorizes the donee to do certain acts in the stead of the donor and so it is not an instrument which confers, transfers, limits, charges or donates any title to the donee. A power of attorney to land does not vest allodial title or the right of occupancy of the land to the donee. The donee remains the agent of the owner to exercise the right to ownership of the property on behalf of the owner.” See also the case of Ude v. Nwora (1993) 2 NWLR (Pt.278) 638.

A power of attorney whether granted for consideration or not and coupled with interest, cannot by itself be held to have conferred the donee with any proprietary right in a land or landed property (or subject matter of the transaction). A power of attorney is usually a medium by which proprietary interest in a property the subject matter of the transaction can be transferred, and until the donee has exercised his right of transfer, the absolute title to the property would still be held to reside in the donor. See the cases of Chime v. Chime (2001) 3 NWLR (Pt. 701) 527; Ude v. Nwara (1993) 2 NWLR (Pt. 277) 638 and Nwankwo v. Agwuna (2007) LPELR - 8445.

Conclusion:

A Power of Attorney merely warrants and authorizes the donee to do certain acts in the stead of the donor and so is not an instrument which confers, transfers limits, charges or alienates any title to the donee: rather it could be a vehicle whereby these acts could be done by the donee for and in the name of the donor to a third party.

So even if it authorizes the donee to do any of these acts to any person including himself, the mere issuance of such a power is not per se an alienation or parting with possession. So far, it is categorized as a document of delegation: it is only after, by virtue of the power of attorney, the donee leases or conveys the property, the subject of the power, to any person including himself then there is an alienation. See also the cases of ABU v. KUYABAN (2002) 4 NWLR Pt. 758 Pg.599; OLORUNFEMI v. NIG. BANK LTD. (2003) 5 NWLR Pt. 812 Pg. 1 and AMADI v. NSIRIM (2004) 17 NWLR Pt. 901 Pg. 111. See also the case of Akpene v. Barclays Bank (1977) NSCC (Vol. II) 29 at 36; Rockonoh Property v. NITEL (2001) 7 SCNJ 225 at 248-250.

For further information on the article, please contact the author:

Kingsley E. Izimah, Esq.

[email protected]

0806-809-5282