Powers of attorney and delegation in company dealings
Representation of a company in an act, in a dispute, or at a meeting of its general assembly is read from the law of agency in Civil Code No. 40 of 1951, from the limits of the managing director in the Companies Law, and from article 91 when the subject is attendance at a general-assembly meeting. The frame is on company registration. The managing director's authority is on its page. Preparing the wording of a contract — not a power-of-attorney form — is on the contract-drafting page.
Creating a power of attorney, and its limits, in the Civil Code
Article 927 defines a power of attorney as a contract by which a person puts another in his or her place for a lawful and defined act. It may be confined or made general, and the agent may be given a discretion or confined to a particular act, under articles 931 and 932. The agent must perform the mandate without exceeding the limits drawn for it, with a rule for a departure from those limits when the principal cannot be notified in advance and approval is the likely course, and with a duty to inform the principal promptly, under article 933. If the mandate is unpaid, the agent must take the care taken in his or her own affairs, without being required to take more than the care of an ordinary person if that agent's own affairs are looked after more carefully than that; if the mandate is paid, the care of an ordinary person is always required, under article 934.
Permission and a command are treated as a mandate if a circumstance points to that, and later ratification has the effect of an earlier mandate, while a mere message is not treated as a mandate, under article 928. For the mandate to be valid, the principal must be a person who can perform the act in person, and the agent must be of sound mind and discernment, under article 930. These provisions are read onto the representation of a company to the extent that the principal is the company, acting through whoever has authority to represent it within the limits drawn by its contract and by the Companies Law.
A power of attorney at a general-assembly meeting, and the managing director
Article 91 allows a member to appoint another person, under a certified power of attorney, to attend, discuss and vote at general-assembly meetings, and also allows a member to appoint another member as substitute for that purpose. The Securities Commission determines the rules on the form of the instrument of substitution, its contents and the way it is prepared, and is responsible for its regularity. Powers of attorney and substitutions must be deposited with the Securities Commission at least three days before the appointed time of the meeting, and the Commission is to examine them. The power of attorney and the substitution remain effective for any second meeting to which the first is adjourned. The detail of the meeting is on its page.
The managing director carries out the acts of management within the powers defined by the appointing body and in accordance with its directions, under article 123. That appointment is not a substitute for a certified power of attorney when the act requires a particular form before a notary public, or when the representation would fall outside the limits of article 123. The converse is also true: a power of attorney does not widen the managing director's authority beyond what the appointing body has granted. Electronic contracts, and their evidential force where the signature is electronic, are on their page.
Limits of a power of attorney, and the commercial-agency licence
An unlimited general power of attorney does not dispense with stating the act in every setting: article 927 of the Civil Code requires the act to be lawful and known, and article 933 binds the agent to carry out the mandate without exceeding its limits. A power of attorney does not replace registration of the company or an amendment of its contract before the Registrar. If what is sought is a commercial-agency licence, not a civil mandate to attend or to sign, the path is on the commercial-agency page.
The Law Office of Ali Barakat follows this reading of the mandate from Baghdad, al-Yarmouk.
Legal basis and sources
Frequently asked questions
Does an unlimited general power of attorney dispense with stating the act in every setting?
No. Article 927 requires the act to be lawful and known, and article 933 binds the agent to carry out the mandate without exceeding its limits. A power of attorney does not replace registration of the company or an amendment of its contract before the Registrar.
When must a power of attorney for attendance at a general-assembly meeting be deposited?
Article 91 requires powers of attorney and substitutions to be deposited with the Securities Commission at least three days before the meeting. They remain effective for any second meeting to which the first is adjourned.
Does appointing a managing director replace a certified power of attorney?
Appointing a managing director confers the acts of management within the limits of article 123. It does not replace a certified power of attorney when the act requires a particular form, and a power of attorney does not widen the authority beyond what the appointing body has granted.
Related topics and articles
- 01The managing director of a limited company: authority and responsibilityThe managing director of a limited company: appointment, removal, and limits of authority under articles 117, 121(3), 122 and 123.
- 02General assembly meetings, quorum and minutesA general assembly meeting: the invitation, quorum, minutes and decisions under the Companies Law, and sending those decisions to the Registrar.
- 03Obligations that recur after a company is recordedFinal accounts, the audit, the general-assembly meeting and copies sent to the Registrar, distinct from post-incorporation steps and from branch duties.
- 04The address of a company or branch, a lease and a title deedThe company's address in its contract, before the Registrar and in the commercial register; a lease or deed may evidence it. Not a real-estate page.
- 05Registering a company in Basra: which department is approached, and what differs from Baghdad?Registering a company when dealing in Basra under the federal Companies Law, followed from Baghdad.