Power of Attorney

Power of attorney POA offers great convenience to a principal to conduct its activities. It makes delegation easier and simpler. The legal, financial, personal, and other matters can be handled more easily. As the use of POA grows due to its usefulness, similarly, the challenges are overwhelming. It has been a serious cause of concern that the abuse of Power of Attorney POA is growing day by day. This has compelled the government of the UAE to take strict action to combat the arising issues.

Laws and Regulations

Nevertheless, stringent laws and regulations have been established to allow transparency. Besides, actions are taken to create awareness among the people of UAE about the misuse and correct use of POA. However, its misuse can also be very harmful and dangerous. It can adversely impact the finances. Furthermore, its misuse can lead to serious monetary losses. It may also result in severe legal disputes and disagreements. It negatively impacts the reputation and goodwill of the principal.

Types of POA: Globally

Generally, there are 4 types of POA including General Power of Attorney, Specific POA, Durable POA, and Limited and Duration Power of Attorney. Besides, it is essential to understand the significance and right use of Power of Attorney POA.

Abuse of POA

Abuse of POA is a common practice and thus it is essential to address the shortcomings. The abuse normally occurs when the agent exceeds its power or stated authority. He acts more like a principal rather than an agent. 

Some of the most common examples include the following:

• Any unauthorized transaction is an abuse of power. Anyone selling or transferring the property without proper and valid principal consent is also part of the abuse of POA. 

• Secondly, any unauthorized transaction also constitutes the misuse of POA. Any abuse of funds, money, or assets that are entrusted to an agent by the principal is abuse.

• The conflict of interest also forms part of misuse. Any agent who acts in ways that do not benefit the principal but instead harms them also constitutes the abuse of POA.

Fraudulent Activities

Moreover, fraudulent activities are quite common. If any agent uses the Power of Attorney POA to commit fraud like forging the documents, fake signatures, or misrepresenting the principal in any form is a misuse of the power.

Legal Implications

There are legal implications to the abuse of Power of Attorney in the UAE. The government can take abuse very seriously and has placed strict laws and regulations to deal with it. The specifically designed regulations address the misconduct efficiently. According to the law, the agents have a fiduciary duty. It means it is obligatory for the agent to act in good faith and also account for the best interest of the principal. Anyone who breaches the fiduciary duty will face severe consequences. It also results in the automatic revocation of the Power of Attorney POA.

UAE Penal Code

As per the UAE penal code and federal law, any agent who is involved in fraudulent activities will face criminal liability. Agent is involved in illegal activities or embezzlement which is a serious criminal offence. This may lead to a jail sentence, heavy charges, and in serious cases life imprisonment. 

• Additionally, anyone who misrepresents or forges the use of POA is termed as a criminal offense. This will lead to serious punitive actions against the agent.

Contractual Violations

Any contractual violations are also a criminal offense. In case, if any agent violates, or breaches the terms of the POA, the principal has the right to file a case for a breach of a contract. Besides, the principal can seek compensation and claim for the damages. Besides, it must be notarized by the UAE notary public to get the right stamp. This will make the document valid and legitimate. 

Outline scope of POA

Thirdly, it is important to clearly outline the scope of the POA. It must also describe the limitations of the agent’s power and authority to make things clear and understandable. Proper steps must be taken to avoid the misuse of POA. It is advisable to wisely choose the agent. Always select the agent carefully by doing homework. Always go for a trusted individual who has a proper track record of integrity, honesty, and professionalism.

Besides, it is important to account for the conflict of interest. If an agent has a conflict of interest, it is essential to avoid it altogether. A periodic review of the agent’s action is necessary. The time-to-time monitoring will ensure compliance. Giving a free hand to the agent is not fruitful. The principal must keep an eye on the agent and also request regular updates. Al Shaiba Advocates and Legal Consultants, is one of the best Dubai Law Firms. We have a team of dedicated and top Emirati Lawyers and Legal Consultants. We have a team of UAE’s leading lawyers and legal consultants. 

However, these lawyers can also help out in resolving the matter amicably. Employers may know the labour laws, but do you know your rights as an employee at work? If you have a problem at work, where will you go? The HR department usually doesn’t help in this scenario unless it is managed by those who are also good Labour and Employment Lawyers.

When someone needs their teeth to be fixed, then dentists are approached, and appointments are obtained. Similarly, Lawyers, Law Firms, and Consultants are found when there is a legal conflict because it can only be sorted out by experts.

You Have Rights:

You have a right as a citizen, too. There are many legal rights of every individual, of which people can be unaware. To know your legal rights, you need to know your actual position. For example, if you are an employee in a company, then you must know a few things before joining the company.

Labour and Employment Lawyers are the experts for the employees and employers. Property Lawyers are helpful in property buying, selling and renting disputes and so on. You must ask a labour lawyer or relevant lawyer to review your employment contract or advise on a sales purchase agreement, etc. He will explain to you completely, which would include your fundamentals and obligations.

Apart from this, Labour Lawyers can also help you in other employment conflicts, property lawyers can also help you in buying the property, and other lawyers can also help you out in meeting outside the court and resolving amicably. What it all shows is that a lawyer is kind of an all-rounder. The only thing that you need is evidence of such things. The employers, buyers, partners or any other counterparty in the case usually get the escape because the plaintiff becomes a failure to arrange enough documents.

Fee Structure:

It’s the only thing that can stop you from hiring a lawyer or the lawyer of your choice. You are looking for a lawyer, a lawyer is available, he is well competent, educated and experienced, you have supporting documents, the court has accepted or will accept the case, then what next?

Still, at this point, services can not be hired due to a very important factor, and the factor is the Fee Structure. The lawyer will not take up the Case if he is not being offered the fee he deserves or he asks. We recommend that one should not fight over the fee structure if the lawyer is intelligent and experienced.