deed of assignment with special power of attorney

January 18, 2017

G.R. No. 192602

SPOUSES MAY S. VILLALUZ and JOHNNY VILLALUZ, JR., Petitioners
vs.
, Respondents

JARDELEZA,

The Civil Code sets the default rule that an agent may appoint a substitute if the principal has not prohibited him from doing so. The issue in this petition for review on which seeks to set aside the Decision dated September 22, 2009 and Resolution dated May 26, 2010 of the Court of Appeals (CA) in CA-G.R. CV No. 01307, is whether the mortgage contract executed by the substitute is valid and binding upon the principal.

I

Sometime in 1996, Paula Agbisit (Agbisit), mother of petitioner May S. Villaluz (May), requested the latter to provide her with collateral for a loan. At the time, Agbisit was the chairperson of Milflores Cooperative and she needed ₱600,000 to ₱650,000 for the expansion of her backyard cut flowers business. May convinced her husband, Johnny Villaluz (collectively, the Spouses Villaluz), to allow Agbisit to use their land, located in Calinan, Davao City and covered by Transfer Certificate of Title (TCT) No. T-202276, as collateral. On March 25, 1996, the Spouses Villaluz executed a Special Power of Attorney in favor of Agbisit authorizing her to, among others, "negotiate for the sale mortgage, or other forms of disposition a parcel of land covered by Transfer Certificate of Title No. T-202276" and "sign in our behalf all documents relating to the sale, loan or mortgage, or other disposition of the aforementioned property. " The one-page power of attorney neither specified the conditions under which the special powers may be exercised nor stated the amounts for which the subject land may be sold or mortgaged.

On June 19, 1996, Agbisit executed her own Special Power of Attorney, appointing Milflores Cooperative as attorney-in-fact in obtaining a loan from and executing a real mortgage in favor of Land Bank of the Philippines (Land Bank). On June 21, 1996, Milflores Cooperative, in a representative capacity, executed a Real Estate Mortgage in favor of Land Bank in consideration of the ₱3,000,000 loan to be extended by the latter. On June 24, 1996, Milflores Cooperative also executed a Deed of Assignment of the Produce/Inventory as additional collateral for the loan. Land Bank partially released one-third of the total loan amount, or ₱995,500, to Milflores Cooperative on June 25, 1996. On the same day, Agbisit borrowed the amount of ₱604,750 from Milflores Cooperative. Land Bank released the remaining loan amount of ₱2,000,500 to Milflores Cooperative on October 4, 1996.

Unfortunately, Milflorcs Cooperative was unable to pay its obligations to Land Bank. Thus, Land Bank filed a petition for extra-judicial foreclosure sale with the Office of the Clerk of Court of Davao City. Sometime in August, 2003, the Spouses Villaluz learned that an auction sale covering their land had been set for October 2, 2003. Land Bank won the auction sale as the sole bidder.

The Spouses Villaluz filed a complaint with the Regional Trial Court (RTC) of Davao City seeking the annulment of the foreclosure sale. The sole question presented before the RTC was whether Agbisit could have validly delegated her authority as attorney-in-fact to Milflores Cooperative. Citing Article 1892 of the Civil Code, the RTC held that the delegation was valid since the Special Power of Attorney executed by the Spouses Villaluz had no specific prohibition against Agbisit appointing a substitute. Accordingly, the RTC dismissed the complaint.

On appeal, the CA affirmed the RTC Decision. In its Decision dated September 22, 2009, the CA similarly found Article 1892 to be squarely applicable. According to the CA, the rule is that an agent is allowed to appoint a sub-agent in the absence of an express agreement to the contrary and that "a scrutiny of the Special Power of Attorney dated March 25, 1996 executed by appellants in favor of [Agbisit] contained no prohibition for the latter to appoint a sub-agent." Therefore, Agbisit was allowed to appoint Milflores Cooperative as her sub-agent.

After the CA denied their motion for reconsideration, the Spouses Villaluz filed this petition for review. They argue that the Real Estate Mortgage was void because there was no loan yet when the mortgage contract was executed and that the Special Power of Attorney was extinguished when Milflores Cooperative assigned its produce and inventory to Land Bank as additional collateral. In response, Land Bank maintains that the CA and RTC did not err in applying Article 1892, that the Real Estate Mortgage can only be extinguished after the amount of the secured loan has been paid, and that the additional collateral was executed because the deed of assignment was meant to cover any deficiency in the Real Estate Mortgage.

II

Articles 1892 and 1893 of the Civil Code provide the rules regarding the appointment of a substitute by an agent:

(1) When he was not given the power to appoint one;

(2) When he was given such power, but without designating the person, and the person appointed was notoriously incompetent or insolvent.

All acts of the substitute appointed against the prohibition of the principal shall be void.

Art. 1893. In the cases mentioned in Nos. 1 and 2 of the preceding article, the principal may furthermore bring an action against the substitute with respect to the obligations which the latter has contracted under the substitution.

The law creates a presumption that an agent has the power to appoint a substitute. The consequence of the presumption is that, upon valid appointment of a substitute by the agent, there arises an agency relationship between the principal and the substitute, the substitute becomes the agent of the principal. As a result, the principal is bound by the acts of the substitute as if these acts had been performed by the principal's appointed agent. Concomitantly, the substitute assumes an agent's obligations to act within the scope of authority, to act in accordance with the principal's instructions, and to carry out the agency, among others. In order to make the presumption inoperative and relieve himself from its effects, it is incumbent upon the principal to prohibit the agent from appointing a substitute.

Although the law presumes that the agent is authorized to appoint a substitute, it also imposes an obligation upon the agent to exercise this power conscientiously. To protect the principal, Article 1892 allocates responsibility to the agent for the acts of the substitute when the agent was not expressly authorized by the principal to appoint a substitute; and, if so authorized but a specific person is not designated, the agent appoints a substitute who is notoriously incompetent or insolvent. In these instances, the principal has a right of action against both the agent and the substitute if the latter commits acts prejudicial to the principal.

The case of illustrates the prevailing rule. In that case, the father, through a special power of attorney, appointed his daughter as his attorney-in-fact for the purpose of selling real properties. The daughter then appointed a substitute or sub-agent to sell the properties. After the properties were sold, the father sought to nullify the sale effected by the subagent on the ground that he did not authorize his daughter to appoint a subagent. We refused to nullify the sale because it is clear from the special power of attorney executed by the father that the daughter is not prohibited from appointing a substitute. Applying Article 1892, we held that the daughter "merely acted within the limits of the authority given by her father, but she will have to be 'responsible for the acts of the sub-agent,' among which is precisely the sale of the subject properties in favor of respondent."

In the present case, the Special Power of Attorney executed by the Spouses Villaluz contains no restrictive language indicative of an intention to prohibit Agbisit from appointing a substitute or sub-agent. Thus, we agree with the findings of the CA and the RTC that Agbisit's appointment of Milflores Cooperative was valid.

III

Perhaps recognizing the correctness of the CA and the RTC's legal position, the Spouses Villaluz float a new theory in their petition before us. They now seek to invalidate the Real Estate Mortgage for want of consideration. Citing Article 1409(3), which provides that obligations "whose cause or object did not exist at the time of the transaction" are void the Spouses Villaluz posit that the mortgage was void because the loan was not yet existent when the mortgage was executed on June 21, 1996. Since the loan was released only on June 25, 1996, the mortgage executed four days earlier was without valuable consideration.

Article 1347 provides that "[a]ll things which are not outside the commerce of men, may be the object of a contract." Under Articles 1461 and 1462, things having a potential existence and "future goods," those that are yet to be manufactured, raised, or acquired, may be the objects of contracts of sale. The narrow interpretation advocated by the Spouses Villaluz would create a dissonance between Articles 1347, 1461, and 1462, on the one hand, and Article 1409(3), on the other. A literal interpretation of the phrase "did not exist at the time of the transaction" in Article 1409(3) would essentially defeat the clear intent and purpose of Articles 1347, 1461, and 1462 to allow future things to be the objects of contracts. To resolve this apparent conflict, Justice J.B.L. Reyes commented that the phrase "did not exist" should be interpreted as "could not come into existence" because the object may legally be a future thing. We adopt this interpretation.

One of the basic rules in statutory interpretation is that all parts of a statute are to be harmonized and reconciled so that effect may be given to each and every part thereof, and that conflicting intentions in the same statute are never to be supposed or so regarded. Thus, in order to give effect to Articles 134 7, 1461, and 1462, Article 1409(3) must be interpreted as referring to contracts whose cause or object is impossible of existing at the time of the transaction.

The cause of the disputed Real Estate Mortgage is the loan to be obtained by Milflores Cooperative. This is clear from the terms of the mortgage document, which expressly provides that it is being executed in "consideration of certain loans, advances, credit lines, and other credit facilities or accommodations obtained from [Land Bank by Milflores Cooperative] x x x in the principal amount of [₱3,000,000]." The consideration is certainly not an impossible one because Land Bank was capable of granting the ₱3,000,000 loan, as it in fact released one-third of the loan a couple of days later. Although the validity of the Real Estate Mortgage is dependent upon the validity of the loan, what is essential is that the loan contract intended to be secured is actually perfected, not at the time of the execution of the mortgage contract the loan contract. In loan transactions, it is customary for the lender to require the borrower to execute the security contracts prior to initial drawdown. This is understandable since a prudent lender would not want to release its funds without the security agreements in place. On the other hand, the borrower would not be prejudiced by mere execution of the security contract, because unless the loan proceeds are delivered, the obligations under the security contract will not arise. In other words, the security contract-in this case, the Real Estate Mortgage-is conditioned upon the release of the loan amount. This suspensive condition was satisfied when Land Bank released the first tranche of the ₱3,000,000 loan to Milflores Cooperative on June 25, 1996, which consequently gave rise to the Spouses Villaluz's obligations under the Real Estate Mortgage.

IV

The Spouses Villaluz claim that the Special Power of Attorney they issued was mooted by the execution of the Deed of Assignment of the Produce/Inventory by Milflores Cooperative in favor of Land Bank. Their theory is that the additional security on the same loan extinguished the agency because the Deed of Assignment "served as payment of the loan of the [Milflores] Cooperative."

The assignment was for the express purpose of "securing the payment of the Line/Loan, interest and charges thereon." Nowhere in the deed can it be reasonably deduced that the collaterals assigned by Milflores Cooperative were intended to substitute the payment of sum of money under the loan. It was an accessory obligation to secure the principal loan obligation.

The assignment, being intended to be a mere security rather than a satisfaction of indebtedness, is not a elation in payment under Article 1245 and did not extinguish the loan obligation. "Dation in payment extinguishes the obligation to the extent of the value of the thing delivered, either as agreed upon by the parties or as may be proved, unless the parties by agreement-express or implied, or by their silence-consider the thing as equivalent to the obligation, in which case the obligation is totally extinguished." As stated in the second condition of the Deed of Assignment, the "Assignment shall in no way release the ASSIGNOR from liability to pay the Line/Loan and other obligations, except only up to the extent of any amount actually collected and paid to ASSIGNEE by virtue of or under this Assignment." Clearly, the assignment was not intended to substitute the payment of sums of money. It is the delivery of cash proceeds, not the execution of the Deed of Assignment, that is considered as payment. Absent any proof of delivery of such proceeds to Land Bank, the Spouses Villaluz' s claim of payment is without basis.

Neither could the assignment have constituted payment by cession under Article 1255 for the plain and simple reason that there was only one creditor, Land Bank. Article 1255 contemplates the existence of two or more creditors and involves the assignment of all the debtor's property.

The Spouses Villaluz understandably feel shorthanded because their property was foreclosed by reason of another person's inability to pay. However, they were not coerced to grant a special power of attorney in favor of Agbisit. Nor were they prohibited from prescribing conditions on how such power may be exercised. Absent such express limitations, the law recognizes Land Bank's right to rely on the terms of the power of attorney as written. "Courts cannot follow one every step of his life and extricate him from bad bargains, protect him from unwise investments, relieve him from one-sided contracts, or annul the effects of [unwise] acts." The remedy afforded by the Civil Code to the Spouses Villaluz is to proceed against the agent and the substitute in accordance with A1iicles 1892 and 1893.

the petition is The Decision dated September 22, 2009 and Resolution dated May 26, 2010 of the Court of Appeals in CA-G.R. CV No. 01307 are

SO ORDERED.

FRANCIS H. JARDELEZA

ALFREDO BENJAMIN S. CAGUIOA * Associate Justice

A T T E S T A T I O N

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

MARIA LOURDES P.A. SERENOPRESBITERO J. VELASCO, JR.MARIA LOURDES P.A. SERENO MARIA LOURDES P.A.SERENO Chief Justice MARIA LOURDES P.A. SERENO Associate Justice Chairperson, Third Division

C E R T I F I C A T I O N

Pursuant to the Section 13, Article VIII of the Constitution, and the Division Chairperson’s attestation, it is hereby certified that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

MARIA LOURDES P.A. SERENO Chief Justice

* Designated as Fifth Member of the Third Division per Special Order No. 2417 dated January 4, 2017.

1 Rollo, pp. 30-44.

2 Id. at 10-18. Penned by Associate Justice Leoncia R. Dimagiba, with Associate Justices Edgardo A. Camello and Edgardo T. Lloren, concurring.

3 Id. at 19.

4 Id. at 11.

6 Rollo, p. 55.

8 Rollo, pp. 56-57.

9 Id at 58-61.

10 Id. at 62-66.

11 Id. at 13.

13 Rollo, pp. 69-72.

14 Supra note 2.

15 Rollo, pp. 14-15.

16 Id. at 37-39.

17 Id. at 93-105.

18 CIVIL CODE, Art. 1881.

19 CIVIL CODE, Art. 1887.

20 CIVIL CODE, Art. 1884.

21 G.R. No. 137162: January 24, 2007, 512 SCRA 411.

22 Id. at 423-424. Citation omitted.

23 The Lawyers Journal, Vol. XVI, January 31, 1951, p. 50, as cited by Tolentino, Commentaries and Jurisprudence on the Civil Code of the Philippines, Vol. IV, 1991, p. 629; and Paras, Civil Code of the Philippines Annotated, Vol. IV, 2012, p. 818.

24 People v. Garcia, 85 Phil. 651, 654-655 (1950).

25 CIVIL CODE, Art. 1348 provides: Impossible things or services cannot be the object of contracts.

26 Rollo, p. 58.

27 CIVIL CODE, Act. 2086.

28 A loan contract is a real contract, not consensual, and, as such, is perfected only upon the delivery of the object of the contract. See Naguiat v. Court of Appeals, G.R. No. 118375, October 3, 2003, 412 SCRA 591, 597.

29 Id. at 599.

30 Rollo, pp. 38-39.

31 Rollo, p. 62.

32 Art. 1245. Dation in payment, whereby property is alienated to the creditor in satisfaction of n debt in money, shall be governed by the law of sales.

33 Development Bank of the Philippines v. Court of Appeals, G.R. No. 118342, January 5, 1998, 284 SCRA 14, 25.

34 Philippine National Bank v. Dee, G. R. No. 182128, February 19, 2014, 717 SCRA 14, 27-28.

35 Rollo, p. 63.

36 Art. 1255. The debtor may cede or assign his property to his creditors in payment of his debts. This cession, unless there is stipulation to the contrary, shall only release the debtor from responsibility for the net proceeds of the thing assigned. The agreements which, on the effect of the cession, are made between the debtor and his creditors shall be governed by special laws.

37 Yulim International Company Ltd. v. International Exchange Bank (now Union Bank of the Philippines), G.R. No. 203133, February 18, 2015, 751 SCRA 129, 143. Citation omitted.

38 Art. 1900. So far as third persons are concerned, an act is deemed to have been performed within the scope of the agent's authority, if such act is within the terms of the power of attorney, as written, even if the agent has in fact exceeded the limits of his authority according to an understanding between the principal and the agent.

39 Vales v. Villa, 35 Phil. 769, 788 (1916).

Powers of attorney: the requirements for a deed

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If a document containing a power of attorney does not satisfy these requirements for a deed, it will not be valid.

This means that the attorney will have no authority to bind the principal. If the power of attorney does satisfy the requirements, the principal will not be bound by any acts of the attorney which fall outside the scope of the power.

A power of attorney can only be given by deed and the following formalities must be satisfied:

• the deed must be in writing;
• it must be made clear that it is intended to be a deed (this can be done by using wording such as “by way of deed…” at the start of the instrument and “executed as a deed” at the end);
• the deed must be validly executed as a deed by the principal (in the case of an individual, this means that it must be signed by the principal in the presence of a witness who then attests the principal’s signature); and
• the deed must be delivered, at which point it will bind the principal (under common law, a deed is delivered when a party indicates an intention to be bound by it). Delivery is usually addressed in the deed by using wording such as “This deed is delivered on the date at the start of this deed”.

If a document containing a power of attorney does not satisfy these requirements for a deed, it will not be valid. This means that the attorney will have no authority to bind the principal. If the power of attorney does satisfy the requirements, the principal will not be bound by any acts of the attorney which fall outside the scope of the power.

Absent shareholders

Powers of attorney are often used to complete transactions where a party will be absent from the completion meeting. In  Katara Hospitality v Guez [2018] EWHC 3063 (Comm) , three shareholders had agreed to sell shares in a company. Two of the shareholders were unable to attend the completion meeting so their US lawyer arranged for them to sign powers of attorney in favour of the third shareholder. The documents were described as powers of attorney and their signatures were appropriately witnessed. But the word ‘deed’ was not used anywhere in the documents.

At the completion meeting, the attending shareholder, relying on the two powers of attorney, signed a guarantee on the absent shareholders’ behalf. At a later point, the beneficiary of the guarantee made a claim under it, at which point the absent shareholders claimed that they were not liable as the powers of attorney were not valid.

The High Court agreed. It was not convinced that the shareholders, or their US lawyer, understood the English law requirements for a power of attorney and that it must be executed as a deed to be valid. The document was simply described as a power of attorney and this was not sufficient for the court to infer that the parties intended the document to be classed as such.

Agency and scope

A power of attorney which fails to meet the strict requirements may still result in an agency arrangement, where the attorney is appointed as agent of the principal. An agent in this scenario will have authority to act on behalf of the principal if the act falls within the scope of the authority conferred on the agent.

The High Court reached this conclusion as the document could still take effect in writing. The shareholder who attended the completion meeting was appointed as agent of the absent principals. But the execution of a guarantee, which was a new document, prepared and agreed at the completion meeting, was not within the scope of authority granted to the agent.

The powers gave the agent the authority to sign documents “in connection with completion” of the transaction. The powers of attorney were sent to the buyer’s solicitor along with a statement that they were to be used “in the event there are any changes that require documents to be re-signed”. When the powers of attorney were executed by the absent shareholders, the guarantee was not in their contemplation as at that point it did not form part of the completion documents. It was not a document which required “re-signing” but was a completely new document, negotiated and agreed at the completion meeting. It was held that the agent was not authorised to sign the guarantee on behalf of the other shareholders.

Importance of execution

This decision confirms that simply describing a document as a ‘power of attorney’ will not be sufficient to create a legally binding power. Each of the individual requirements for the creation of a deed must be satisfied.

It also reminds us of the importance of checking what the deed actually allows the attorney to do.

If you are asked to rely on another party signing via a power of attorney, you must confirm that the power has been properly granted and that the act being contemplated is within the attorney’s authority. If this is not the case, any documents signed or executed under that power of attorney are likely to be invalid and not legally binding.

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Difference of Transfer of Rights vs. Deed of Assignment

Deed of assignment (doa).

A Deed of Assignment is a legal document in which one party (assignor) formally assigns specific rights, interests, or responsibilities to another person (assignee). DOAs are often used in a variety of contexts, including real estate sales, contractual rights assignments, debt assignments, intellectual property transfers, and more.

A DOA normally necessitates a formal contract outlining the terms and conditions of the assignment, including the persons involved, the rights being transferred, any compensation (money or value exchanged), and other pertinent elements. Depending on the nature of the rights being assigned, a DOA may require notarization or registration with the proper government body in order to be legally enforceable.

TRANSFER OF RIGHTS 

A Transfer of Rights is a wider term that incorporates many methods of transferring rights from one party to another. It can include assignments, conveyances, endorsements, and other types of rights transfers. Transfer of Rights can be utilized in a variety of circumstances, including contracts, real estate transactions, inheritance, and legal settlements.

The formalization of a Transfer of Rights can differ depending on the circumstances and the type of rights being transferred. Contracts, deeds, endorsements, and court orders are examples of legal papers. The legal requirements for a Transfer of Rights are determined by the nature of the transaction and the rights being transferred. Some transactions may need to be notarized or registered, while others may not.

Difference between deed of Assignment and Transfer of Rights

In summary, a Deed of Assignment is a sort of legal document that is often used for various transactions to transfer specific rights, interests, or responsibilities from one party to another. 

Transfer of Rights , on the other hand, is a broader notion that incorporates several techniques of transferring rights and can be applied in a wide range of legal and financial scenarios. 

DOAs and rights transfers may both require legal procedures to assure their legitimacy and enforceability.

Difference between Deed of Sale and Deed of Assignment

A deed of sale is a contract entered into by the parties where the property shall be transferred by the seller to the buyer subject upon the payment of the purchase price. What is being transferred during the sale is not just the property itself, but the ownership, possession, usage, and rights to the property therein. While a deed of sale is evidence of the transfer of the property from the seller to the buyer, the deed of sale also has another purpose. 

It also serves as a notice to those who wish to buy the property that the ownership and rights to the property have now gone from the original owner to the current owner of the property. 

When the sale is deemed as absolute, it means that there are no other conditions to the sale, only the payment of the purchase price indicated in the deed of sale.  

A deed of assignment , on the other hand, is a contract entered into by parties, wherein by way of assignment, the assignor transfers property ownership to the assignee. In assignment, the rights of the assignor are being transferred to the assignee. The obligations of the assignor are likewise being transferred to the assignee. In effect, the assignor no longer is a part of the original contract as he or she is being replaced by the assignee. 

Note that for the assignment to be valid, there must be an agreement or consent by the original parties to the contract that an assignment shall be taking place.  

What happens when one Transfers Rights? 

When one transfers rights , one does not necessarily totally relinquish all of his rights over the property being transferred to another. 

When there are concerns with the completeness or clarity of a property’s title, this can be used. In such instances, a DOA can assist with addressing and resolving these concerns by formally transferring any transferable rights or interests.

For example, if the title is indistinct. If there are ambiguities, disagreements, or conflicting claims regarding a property’s ownership or rights, a DOA may be used to transfer any legal, clear, and indisputable rights to another party. This can help to clarify ownership and possibly settle title concerns.

Another example is when a DOA can be used to transfer any existing rights that are backed by available documentation when some required documents for a complete property title are missing or unavailable.

If a property has multiple co-owners or partial owners, a DOA can be used to transfer the interests of the other co-owners to the desired owner(s). Another situation is that when the existing title documentation contains errors or inconsistencies, a DOA can be used to fix these issues by transferring the correct and exact rights to the appropriate parties.

When someone transfers rights to another party, they do not necessarily relinquish all rights to the property or subject matter being transferred. The amount of the transfer and the precise rights involved can vary greatly depending on the wording of the transfer agreement and the parties’ intentions.

Many times when rights are transferred, the transferor (the party transferring the rights) retains some rights or interests while handing particular rights to the transferee (the party receiving the rights). This provides for more flexible arrangements that may be adjusted to both parties’ requirements and aims.

The rights, ownership, and possession of the property depends upon what kind of transfer of rights was done. There are instances when one transfers rights wherein the usage and possession of the property shall be with the other, however the owner shall retain the ownership of the property. Some of the ways where one may transfer rights are through will, gifts, donation, sale, and deed. 

A transfer through deed requires formalities indicated in an instrument, stipulating the necessary information and signatories therein.        

Need further information and assistance regarding the difference of transfer or rights and deed of sale or deed of assignment in the Philippines?  Talk to our team at FILEDOCSPHIL to know more about the requirements and process. Call us today at (+632) 8478 5826 or send an email to [email protected] for more information.

Understanding a deed of assignment for intellectual property

A deed of transfer is used to change the ownership of intellectual property, a common occurrence in business. Explore how and when to use one.

Find out more about intellectual property basics

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Brette is a former attorney and has been a writer and editor for more than 25 years. She is the author of more than 4...

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Updated on: November 24, 2023 · 3 min read

Understanding intellectual property in business

How to transfer intellectual property rights in business, what to include in a deed of assignment, registering new ownership, restrictions on intellectual property transfers.

Most companies have intellectual property as part of their assets, including software, product design, or copyright to white papers. Buying or selling such property is done using a document called a deed of assignment.

A large part of what a business consists of may be tied to intellectual property . It's easy to see physical property a company owns, such as a building, office furniture, or inventory, but intellectual property can be more challenging to identify.

Most businesses have intellectual property, or works created by human minds or, in some cases, by computers. Some examples of intellectual property include architectural drawings, ad campaigns, company or product names, inventions, and source code.

Examples of when transfers of intellectual property might happen include when a company is buying another company, when you are setting up an LLC and want to transfer your intellectual property into the company, or when a business buys product rights from another company or individual.

A deed of assignment can be done in one transaction, instead of one transaction for each item of intellectual property, by transferring all ownership rights of all intellectual property detailed in the deed. The document is signed by both the buyer and seller. No payment is required for it to be valid.

A deed of assignment must be in writing and should include:

• The names and addresses of the assignor and assignee
• A description of the program or product for which the rights are being transferred
• A statement that all intellectual property rights to the property are being transferred
• Signatures of the parties and the date of the agreement execution

The deed could also include the following sections, where applicable:

• Consideration, or payment, to be made to the original owner.
• Warranties, or promises that the intellectual property rights being assigned don't infringe on anyone else's intellectual property rights . For example, in a deed regarding the transfer of a copyright, this section could state that the copyrighted work is original and not owned by someone else.
• Indemnification, or promise by the seller to reimburse the assignee if there is some problem with title to the property.
• Future assignments. For example, the agreement could be ongoing, so that anything the assignor creates in the future for this product or program is also transferred to the buyer.

Although a deed of assignment transfers ownership in intellectual property , it does not change the registration of the ownership. The assignee is responsible for handling all registration requirements.

For example, if a patent is transferred via a deed of assignment, the new owner must record the change in ownership with the U.S. Patent and Trademark Office. Similarly, the transfer of a copyright is recorded with the U.S. Copyright Office.

Transfers of intellectual property must comply with U.S. laws. One obvious caveat is that you can't transfer property you don't own. Transfers must also comply with antitrust laws, which are set up to prevent one company from completely dominating an industry.

If intellectual property rights are being transferred overseas, the transfer must comply with Export Administration Regulations and the International Traffic in Arms Regulations , which are designed to protect national security and trade.

The deed of assignment can be a crucial part of a business deal or transaction. You can create a deed of assignment yourself, or you can work with an attorney .

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POWER OF ATTORNEY IN LAND MATTERS

You all will agree with me that the world today is a very busy place. A person might have several activities for a day and might not have the time for other things.

For this reason, men have to depend on others to get things done, hence the reason for Power of Attorney. Power of Attorney is a legal process that involves the drafting of a document. This document assigns to another person the power to act as your legal representative.

Power Of Attorney is generally defined as an authority given by one person, called as the donor or principal, authorizing another person, called donee or agent to act on his behalf.

This includes instituting an action in court, signing papers, cheque, title documents, contracts and so on…

There are two types of power of attorney.

General Power of Attorney.  A general power of attorney is one which covers all activities. An instrument is executed by the principal authorizing the agent to do certain acts in general on his behalf.

Special Power of Attorney. This is when   the power given to the appointed person by the principal to do some specified act. This is limited to specific matter such as selling a particular piece of land/property, handling some bank accounts etc. In this instance, principal determines the amount of power given to the agent.

In Nigeria, anybody can create a Power of Attorney.

A Registered company may appoint an Attorney to act on its behalf. The power to appoint a power of attorney is however limited. For example to a minor and a person of unsound mind.

These classes of individuals do not have the capacity to appoint an Attorney (agent). Notwithstanding these limitations, a minor can lawfully appoint regarding necessities of life or for contracts beneficial to the minor.

According to the court in Vulcan Gases Ltd. v. G.F. Ind. Gasverwertung A.G. (G.I.V) (2001) 9 NWLR [Pt. 719] 610, there are five ways the relationship of principal and agent may arise. They are by:

• Express appointment whether orally or by letter of appointment. No formality, such as writing is required for the valid appointment of an agent. Except for instance. Where the authority of the agent is to execute a deed on behalf of a principal. In which case, the agency itself must be created by deed.
• Ratification of the agents acts by the principal.
• Virtue of the doctrine of estoppels.
• Implication of law in the case of agency of necessity and;
• Presumption of law in the case of cohabitation.

A power of attorney generally is terminated when the principal dies or becomes incompetent. A power of attorney may expire on a date stated in the document or upon written cancellation.

If the document of Power of Attorney has not been registered, it can be terminated by:

• The principal’s death
• A termination procedure designated in the original power of attorney document
• Destroying the document if the principal is still competent
• Revoking the durable power of attorney by a written document. This document must be signed, notarized, and sent to the attorney by certified or registered mail.

If the document has been registered, it can be terminated by:

• Revoking the durable power of attorney. This is done by filing a written revocation in the Registrar of Deeds office where the original document was filed
• The death of the principal
• The unavailability of an attorney.

If the attorney-in-fact dies, without the principal naming an alternate, the power of attorney document is also terminated. Regardless of the way that the power of attorney is revoked, the attorney-in-fact should  be notified of termination.

In land transactions, power of attorney is one of the most popular documents. It is a document of delegation. In it, an owner of a Right or Title to a land can transfer his rights to another to exercise.

In most cases in Nigeria, the owner of the land is not usually the seller. The real owner of the land usually appoints his right to sell property to his agents, lawyers or estate managers. It is illegal for any agent to sell or transfer property without specific instruction allowing the agent to do so.

Sales of land under an unauthorized power of attorney will be invalid.  Notwithstanding a Deed of transfer, sales or alienation, a purchaser needs to verify the power of attorney. This is  to show that the agent selling has been empowering or authorized to sell from the original owner.

Before such purchaser goes ahead with documentation, payment and other processes in land transaction, Power of Attorney must be confirmed.

In creating a valid power of attorney, it must be written and executed by the donor to the donee.

Where the donor of a power of attorney is an illiterate.

The donor should have the content of the power of attorney read, explained to him in a language he understands. After this, the donor attach his mark or signature. The date the document was made, name and address of the interpreter of a power of attorney must be provided .

Any power of attorney made by an illiterate without the above statement or the details of the interpreter is invalid.

A power of attorney need not to be under a seal. However, for documents that requires seal like Deed of Assignment, Deed of Transfer, such power of attorney must be sealed. Like most agreements, a power of attorney must be witnessed by at least  one witness.

AN EXAMPLE OF A LETTER OF POWER OF ATTORNEY BELOW.

BY THIS POWER OF ATTORNEY, I, CDQ of No. 3, XYZ Street, Lagos City hereby appoint RXY of No. 3, POS Street, Lagos, my Attorney in my name and on my behalf to do all of the acts and things namely.

• To take possession of my leasehold property known as Plot 10, XXX Crescent, Ibeju Lekki Estate, Lagos, Nigeria. and registered in my name as No. 38/87/33 at the Lands Registry in Lagos and to manage the same.
• To develop the same for building purposes and to build a house or houses thereon in accordance with his own style, approval and design, mortgage, charge sell, lease, let or otherwise dispose of the same; to collect, distrain for, enforce payment of and recover the rents and profits of the same, and to accept and surrender of leases and tenancies affecting the same and to enter into contracts, covenants and arrangements of all kinds affecting the same.
• To assign or procure the assignment of the said land to himself or any other person or persons and to execute all documents relating to the same and I hereby declare that I will do all or anything required of me to effect or facilitate such transfer.

And I hereby further undertake and declare that I will hand over all documents or instruments whatsoever in my possession to be received by me or my servant or agent to the said RXY, his assigns, agents, executors or administrators.

And I further declare that in consideration of the sum of N5,000,000.00 (Five million Naira) now paid to me by the said Attorney, that this power shall be irrevocable.

IN WITNESS whereof, I, the said CDQ have hereunto set my hand and seal this ……..day of ………………… 2016

SIGNED, SEALED AND DELIVERED

by the within named CDQ

In the presence of:

………………………………………..

…………………………………………

Related Posts

First, it is important to know that people, both agents and real estate marketers are not to be trusted. No one can know for sure what land is a government committed land or government acquired land except by land verification search. It is even possible for some fraudulent agents to forge Ebute Ago village Gazette, the Deed of Assignment of the family and the Receipt of payment and present same as if it is the genuine one. It takes a smart and experienced property lawyer or Exparte to know and confirm the authenticity of the land. That is why I advise people seeking to buy land in all these popular areas, especially Ibeju Lekki and Lagos as a whole to seek the assistant of an expert lawyer to help verify the authenticity of the land. You can instruct us formally to verify for you by furnishing us with some vital information and documents via our email address( [email protected] )

can power of attorney be donated for the purpose of giving evidence in court on behalf of the owner of the project, which is the subject matter of a siut.

Thank you for your enquiry johnson. Generally speaking, a well-prepared and duly executed Power of Attorney given to someone can suffice in court as an evidence. For example, a well prepared and irrevocable Power of Attorney given to an agent by the landlord to act on his behalf to manage his property and other things will suffice in court as evidence.

Can an unregistered land with proof of purchase but which has been taken over by another person be recovered? What to do to recover such land?

Thank you Kojak for your comment. whether the land can be recovered or not depends on some facts, for example, has possession taken place on the unregistered land by the first purchaser? Has the second purchaser taken possession? kindly furnish me with facts of the case via email([email protected]), whatsapp(08034869295) or through the comment box.

Kindly enlighten me on the power of attorney in respect of eldest child of the deceased in matter of inheritance.

Thanks for broaden our horizon, please my question is how can I get power of Attorney over a land in Lagos?

Thank you for your inquiry; you did not state whether you are the owner of the land or you are just an agent; however,if you are the landlord you have to meet your lawyer to prepare a Power of Attorney but if the land belongs to a third party, you will have meet the owner to prepare a Power of Attorney

Thank you for your inquiry. However,you didn’t state if you are the owner of the land in question or an agent. In any case, if you are the owner of the land you can approach your lawyer to prepare the Power of Attorney for you. If you are an agent who wishes to rely on it, you will have to meet the owner of the land to issue the document in your favour.

Who process the power of attorney for buying land…the seller or the buyer? And What is the cost of getting a power of attorney for buying of land? Is their a specific price for it or what factors determine the cost?

Statutorily speaking, a power of attorney is usually processed or prepared by the vendor’s solicitor. Considering some factors such as the size and value of the property will depend on the amount chargeable in preparing it. There is no specific price, all that matters is for the vendor and the solicitor to reach an amount payable.

please can somebody help me with an authority on the challenge of Power of Attorney obtained by fraud

is there any authority for the assertion that a power of attorney must be witnessed

My question is a friend of mine purchased a land in her name nd she does not v the money to build a house on it, the husband now said he will but she has to change her name to both of them, the only option they have is to do a power of attorney, is dat right? Is there another option? Because to my understanding if my friend sign the power of attorney she does not have a say on the property if am right.

Can power of attorney be singed on behalf of a Donor?

Quite enlightening

Thanks for this piece but I want to know the position of the law as it pertains to a donee testifying on behalf of a donor, can it be regarded as hearsay when a power of attorney was tendered before the court and does the oral testimony of a donee on behalf of a donor in any way fall under the exception of the hearsay rule in the evidence act..thank you

You are welcome.

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