IS YOUR SPA ( Special Power of Attorney ) EXPIRED?
IS YOUR SPA ( Special Power of Attorney ) EXPIRED
?
At one point in time, you may have encountered a transaction involving the
use of a “SPA” or, a Special Power of Attorney. This is generally used in case
the person, whether the seller or the buyer would or could not be physically
present to enter into the sale agreement and sign or execute the document, be it
a contract to sell or deed of absolute sale. In real estate transactions, an
agent or attorney-in-fact must have a special power of attorney from the
principal (seller or buyer) to be able to into any contract by which the
ownership of an immovable is transmitted or acquired either gratuitously or for
a valuable consideration. (Article 1878, New Civil Code, NCC) However, in
some cases you may encounter that the Special Power of Attorney being presented
by the seller (or the buyer) is more than one year old or, even several years
old. At that instance, the question that one might ask is, “ Is that SPA
still valid ? ” or, “ Is that SPA expired? ”
The issue of the expiration of the SPA is governed by the laws on agency,
more particularly, Article 1919 of the New Civil Code, which provides that
: “Art. 1919. Agency is extinguished: (1) By its revocation; (2) By the
withdrawal of the agent; (3) By the death, civil interdiction, insanity or
insolvency of the principal or the agent; (4) By the dissolution of the firm
or corporation which entrusted or accepted the agency; (5) By the
accomplishment of the object or purpose of the agency; (6) By the expiration
of the period for which the agency was constituted.
Whether the SPA is still valid or, if it has expired depends therefore on
several grounds. As to the expiration of the SPA, the general rule is that
the SPA, even if it was executed several years ago, continues to be valid and
you may still use the same in the real estate deal that you are working on.
You could however look into certain conditions that will affect the validity
or “expiry” of the SPA, such as: 1. If the SPA provides an expiration date.
In some instances, the special power of attorney contains a provision that it is
only valid for a certain period, for example, only for one (1) year. In such a
case, the SPA expires within that date and no longer has any effect or validity
beyond such period as the authority given has expired. 2. It may still
happen, or you might find out that the principal has died, in which case, the
general rule is that agency is likewise extinguished or simply put, the SPA dies
along with the principal and is no longer valid. (Although it could be one which
is still effective even upon death of the principal, though this is an exception
rather than the general rule.) 3. If the principal has revoked the agency, or
the special power given, in which case you must ascertain that no revocation has
been made by the principal. (Or it is one which cannot just be revoked by the
principal.) Of course, if it is possible to obtain another SPA which is
current or recent, then it may be best to have another SPA executed if the other
party insists on a more recent SPA. What’s important is that, the SPA, just
because it was executed several years ago, does not automatically become
“stale”/expired unless certain conditions discussed above arise.
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