Express Authority
Powers of Attorney Act
AN ACT TO PROVIDE FOR POWERS OF ATTORNEY TO OPERATE WHEN THE DONOR OF THE POWER IS OR IS BECOMING MENTALLY INCAPABLE AND TO AMEND IN OTHER RESPECTS THE LAW RELATING TO POWERS OF ATTORNEY GENERALLY. [5th June, 1996]
BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS:
PART I
Preliminary and General
Short title and commencement.
1.—(1) This Act may be cited as the Powers of Attorney Act, 1996.
(2) This Act shall come into force on such day or days as the Minister shall appoint by order or orders either generally or with reference to any particular provisions and different days may be so fixed for different provisions.
Interpretation generally.
2.—(1) In this Act, unless the context otherwise requires—
“convey” includes transfer, lease and assign, and “conveyance” shall be construed accordingly;
“power” means power of attorney;
“power of attorney” means an instrument signed by or by direction of a person (the donor), or a provision contained in such an instrument, giving the donee the power to act on behalf of the donor in accordance with the terms of the instrument;
“statutory declaration” includes a statutory declaration made in accordance with section 3 .
(2) (a) In this Act a reference to a Part, section or Schedule is a reference to a Part, section or Schedule of this Act unless it is indicated that reference to some other enactment is intended.
(b) In this Act a reference to a subsection, paragraph or subparagraph is a reference to the subsection, paragraph or subparagraph of the provision in which the reference occurs unless it is indicated that reference to some other provision is intended.
(3) In this Act a reference to an Act is to that Act as subsequently amended.
Statutory declearation by company.
3.—Where, for any purpose of this Act, a statutory declaration is to be made by a person being a corporation aggregate it may be made on behalf of the corporation by a person authorised by the corporation to act on its behalf.
PART II
Enduring Powers of Attorney
Interpretation.
4.—(1) In this Part—
“affairs”, in relation to a donor of an enduring power, means business or financial affairs of the donor;
“attorney” means the donee of an enduring power and includes a person acting in pursuance of section 5 (3) and complying with the provisions of this Act and regulations made thereunder;
“the court” means the High Court;
“enduring power” shall be construed in accordance with section 5 (1);
“mental incapacity”, in relation to an individual, means incapacity by reason of a mental condition to manage and administer his or her own property and affairs and cognate expressions shall be construed accordingly;
“the Minister” means the Minister for Equality and Law Reform;
“notice” means notice in writing;
“personal care decision”, in relation to a donor of an enduring power, means a decision on any one or more of the following matters:
(a) where the donor should live,
(b) with whom the donor should live,
(c) whom the donor should see and not see,
(d) what training or rehabilitation the donor should get,
(e) the donor’s diet and dress,
(f) inspection of the donor’s personal papers,
(g) housing, social welfare and other benefits for the donor;
“registration”, in relation to an enduring power of attorney, means registration under section 10 , and “registered” shall be construed accordingly.
(2) An application or reference to the court under this Part shall be made in a summary manner.
(3) If any question arises under this Part as to what the donor of the enduring power might at any time be expected to do it shall be assumed that the donor had the mental capacity to do so.
Characteristics of enduring power.
5.—(1) A power of attorney is an enduring power within the meaning of this Act if the instrument creating the power contains a statement by the donor to the effect that the donor intends the power to be effective during any subsequent mental incapacity of the donor and complies with the provisions of this section and regulations made thereunder.
(2) The Minister may make provision by regulations in relation to all of the following matters concerning enduring powers of attorney:
(a) their form,
(b) their execution,
(c) ensuring that any document purporting to create an enduring power incorporates adequate information as to the effect of creating or accepting the power,
(d) the inclusion in the document of all of the following statements—
(i) by the donor, that the donor has read the information as to the effect of creating the power or that such information has been read to the donor,
(ii) by a solicitor (or a member of some other specified class of persons), that, after interviewing the donor and making any necessary enquiries, the solicitor or such member—
(I) is satisfied that the donor understood the effect of creating the power, and
(II) has no reason to believe that the document is being executed by the donor as a result of fraud or undue pressure,
(iii) by a registered medical practitioner, that in his or her opinion at the time the document was executed the donor had the mental capacity, with the assistance of such explanations as may have been given to the donor, to understand the effect of creating the power,
(iv) by the attorney, that the attorney understands the duties and obligations of an attorney and the requirements of registration under section 10 ,
(e) the keeping of accounts by the attorney in relation to the management and disposal of the donor’s property,
(f) the remuneration, if any, to be paid to the attorney,
(g) the attestation of the signatures of the donor and the attorney,
(h) specific provision for cases where more than one attorney is appointed,
(i) the giving by the donor to specified persons of notice of the execution of the power, and
(j) if the regulations amend or revoke any regulations previously made under this subsection, saving and transitional provisions.
(3) The donor of an enduring power may in the document creating the power appoint one or more specified persons, being persons who are not disqualified, to act as attorney if an attorney appointed by the power dies or is unable or declines to act or is disqualified from acting as attorney.
(4) A power of attorney cannot be an enduring power unless, when executing the instrument creating it, the attorney is—
(a) (i) an individual who has attained 18 years and has not been adjudicated bankrupt or convicted of an offence involving fraud or dishonesty or an offence against the person or property of the donor or is not—
(I) a person in respect of whom a declaration has been made under section 150 of the Companies Act, 1990 , or
(II) a person who is or was subject or deemed subject to a disqualification order by virtue of Part VII of that Act,
or
(ii) a trust corporation (within the meaning of section 30 of the Succession Act, 1965 ),
and
(b) not the owner of a nursing home (whether or not it is a nursing home within the meaning of the Health (Nursing Homes) Act, 1990 ) in which the donor resides, or a person residing with or an employee or agent of the owner, unless the attorney is a spouse, parent, child or sibling of the donor.
(5) A power of attorney which gives the attorney a right to appoint a substitute or successor cannot be an enduring power.
(6) Subject to subsection (8) and sections 14 (3) and 14 (5), an enduring power shall be invalidated or, as the case may be, shall cease to be in force on the adjudication in bankruptcy of the attorneyor, if the attorney is a body corporate, by its winding up or dissolution or on the attorney being convicted of an offence referred to in subsection (4) (a) (i) or becoming—
(a) a person referred to in clause (I) or (II) of subsection (4) (a) (i) or
(b) an owner of a nursing home or other person referred to in subsection (4) (b),
unless the attorney is an attorney appointed by the power and subsection (3) applies.
(7) An enduring power in favour of a spouse shall, unless the power provides otherwise, be invalidated or, as the case may be, cease to be in force if subsequently—
(a) the marriage is either annulled under the law of the State or is annulled or dissolved under the law of another state and is, by reason of that annulment or divorce, not or no longer a subsisting valid marriage under the law of the State,
(b) either a decree of judicial separation is granted to either spouse by a court in the State or any decree is so granted by a court outside the State and is recognised in the State as having the like effect,
(c) a written agreement to separate is entered into between the spouses, or
(d) a protection order, interim barring order, barring order or safety order is made against the attorney on the application of the donor, or vice versa.
(8) Subsection (6) shall not apply to an enduring power which authorises, or to the extent that it authorises, an attorney to make personal care decisions on behalf of the donor unless the attorney has been convicted of an offence against the person of the donor or has become a person who would be disqualified from acting as attorney by virtue of subsection (4) (b).
(9) An enduring power shall be invalidated or, as the case may be, shall cease to be in force on the exercise by the court of any of its powers under the Lunacy Regulation (Ireland) Act, 1871 , if the court so directs.
(10) No disclaimer, whether by deed or otherwise, of an enduring power which has not been registered under section 10 shall be valid unless and until the attorney gives notice of it to the donor.
(11) In subsection (4) (b) “owner” includes a person managing a nursing home or a director (including a shadow director within the meaning of section 27 of the Companies Act, 1990 ) of, or a shareholder in, a company which owns or manages such a home.
Scope of authority of attorney under enduring power.
6.—(1) An enduring power may confer general authority (as defined in subsection (2)) on the attorney to act on the donor’s behalf in relation to all or a specified part of the property and affairs of the donor or may confer on the attorney authority to do specified things on the donor’s behalf and the authority may, in either case, be conferred subject to conditions and restrictions.
(2) Where an instrument is expressed to confer general authority on the attorney, it operates to confer, subject to the restriction imposed by subsection (5) and to any conditions or restrictions contained in the instrument, authority to do on behalf of the donor anything which the donor can lawfully do by attorney.
(3) Subject to any conditions or restrictions contained in the instrument, an attorney under an enduring power, whether general or limited, may execute or exercise any of the powers or discretions vested in the donor as a tenant for life within the meaning of the Settled Land Act, 1882.
(4) Subject to any conditions or restrictions contained in the instrument, an attorney under an enduring power, whether general or limited, may act under the power for the attorney’s benefit or that of other persons to the following extent but no further, that is to say, the attorney—
(a) may so act in relation to himself or herself or in relation to any other person if the donor might be expected to provide for his or her or that person’s needs respectively; and
(b) may do whatever the donor might be expected to do to meet those needs.
(5) Without prejudice to subsection (4) but subject to any conditions or restrictions contained in the instrument, an attorney under an enduring power, whether general or limited, may, if specific provision to that effect is made in the instrument, dispose of the property of the donor by way of gift to the following extent but no further, that is to say, by making—
(a) gifts of a seasonal nature or at a time, or on an anniversary, of a birth or marriage, to persons (including the attorney) who are related to or connected with the donor, and
(b) gifts to any charity to which the donor made or might be expected to make gifts,
provided that the value of each such gift is not unreasonable having regard to all the circumstances and in particular the extent of the donor’s assets.
(6) An enduring power may also confer authority on the attorney to make any specified personal care decision or decisions on the donor’s behalf.
(7) (a) Any personal care decision made by an attorney on behalf of a donor shall be made in the donor’s best interests.
(b) In deciding what is in a donor’s best interests regard shall be had to the following:
(i) so far as ascertainable, the past and present wishes and feelings of the donor and the factors which the donor would consider if he or she were able to do so;
(ii) the need to permit and encourage the donor to participate, or to improve the donor’s ability to participate, as fully as possible in any decision affecting the donor;
(iii) so far as it is practicable and appropriate to consult any of the persons mentioned below, their views as to the donor’s wishes and feelings and as to what would be in the donor’s best interests:
(I) any person named by the donor as someone to be consulted on those matters;
(II) anyone (whether the donor’s spouse, a relative, friend or other person) engaged in caring for the donor or interested in the donor’s welfare;
(iv) whether the purpose for which any decision is required can be as effectively achieved in a manner less restrictive of the donor’s freedom of action.
(c) In the case of any personal care decision made by an attorney it shall be a sufficient compliance with paragraph (a) if the attorney reasonably believes that what he or she decides is in the best interests of the donor.
Coming into force and survival of enduring power.
7.—(1) Where an individual creates an enduring power of attorney—
(a) subject to subsection (2) and section 9 , the power shall not come into force until it has been registered under section 10 ; and
(b) the power shall not be revoked by the donor’s subsequent mental incapacity.
(2) Where the attorney has made an application for registration of the instrument then, until the application has been determined, the attorney may take action under the power—
(a) to maintain the donor or prevent loss to the donor’s estate,
(b) to maintain the attorney or other persons in so far as that is permitted under section 6 (4), or
(c) to make a personal care decision which cannot reasonably be deferred until the application has been determined.
(3) Where the attorney purports to act as provided by subsection (2) then, in favour of a person who deals with the attorney without knowledge that the attorney is acting otherwise than in accordance with that subsection, the transaction between them shall be as valid as if the attorney were acting in accordance therewith.
Functions of court prior to registration.
8.—Where the court has reason to believe that the donor of an enduring power may be, or may be becoming, mentally incapable and the court is of the opinion that it is necessary, before the instrument creating the power is registered, to exercise any power with respect to the power of attorney or the attorney appointed to act under it which would become exercisable under section 12 on its registration, the court may on application to it by any interested party exercise that power under this section and may do so whether the attorney has or has not made an application to the court for the registration of the instrument.
Application for registration.
9.—(1) If the attorney under an enduring power has reason to believe that the donor is or is becoming mentally incapable, the attorney shall, as soon as practicable, make an application to the court for the registration of the instrument creating the power.
(2) Before making the application the attorney shall comply with the provisions as to notice set out in the First Schedule .
(3) The attorney may, before making the application, refer to the court for its determination any question as to the validity of the power.
(4) A certificate to the effect that the donor is, or is becoming, incapable by reason of a mental condition of managing and administering his or her own property and affairs and purporting to be signed by a registered medical practitioner may be accepted as evidence of the matters contained therein.
(5) Any person who, in an application for registration, makes a statement which he or she knows to be false in a material particular shall be liable—
(a) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine not exceeding £10,000, or both; and
(b) on summary conviction, to imprisonment for a term not exceeding six months or to a fine not exceeding £1,000, or both.
(6) Pending the making of other provision by rules of court an application under subsection (1) shall be addressed to the Registrar of Wards of Court.
Registration.
10.—(1) On an application for registration being made in compliance with section 9 the Registrar of Wards of Court shall, unless subsection (2) applies, register the instrument to which the application relates.
(2) If, in the case of an application for registration—
(a) a valid notice of objection to the registration pursuant to subsection (3) from a person to whom an attorney has given notice pursuant to paragraph 2 (1) of the First Schedule is received by the court before the expiry of the period of five weeks beginning with the date on which that notice was given,
(b) it appears from the application that there is no one to whom notice has been given under paragraph 2 of that Schedule, or
(c) there is reason to believe that appropriate enquiries might bring to light evidence on which the court could be satisfied that one of the grounds of objection set out in subsection (3) was established,
the court shall neither register the instrument nor refuse the application until it has made or caused to be made such enquiries (if any) as it thinks appropriate in the circumstances of the case.
(3) For the purposes of this Act a notice of objection to the registration of an instrument is valid if the objection is made on one or more of the following grounds, namely—
(a) that the power purported to have been created by the instrument was not valid;
(b) that the power created by the instrument is no longer a valid and subsisting power;
(c) that the donor is not or is not becoming mentally incapable;
(d) that, having regard to all the circumstances, the attorney is unsuitable to be the donor’s attorney;
(e) that fraud or undue pressure was used to induce the donor to create the power.
(4) The court may refuse the application on any of the grounds of objection set out in subsection (3).
(5) (a) Where an instrument differs in an immaterial respect in form or mode of expression from the form prescribed by regulations under section 5 (2) (a) the instrument shall be treated as sufficient in point of form and expression.
(b) The court may, notwithstanding that an instrument may not comply with the provisions of section 5 or regulations made thereunder, register the instrument as an enduring power if it is satisfied—
(i) that the donor intended the power to be effective during any mental incapacity of the donor,
(ii) that the power was not executed as a result of any fraud or undue pressure,
(iii) that the attorney is suitable to be the donor’s attorney, and
(iv) that it is desirable in the interests of justice so to register the instrument.
(6) Where at the time of the application for registration there is in force under the Lunacy Regulation (Ireland) Act, 1871 , an order appointing a committee of the estate of the donor but the power created by the instrument has not also been revoked, the court shall make such order as seems to it proper in the circumstances including, if appropriate, an order revoking the order already made under the said Act.
Effect and proof of registration.
11.—(1) The effect of the registration of an instrument is that—
(a) no revocation of the power by the donor shall be valid unless and until the court confirms the revocation under section 12 (3);
(b) no disclaimer of the power shall be valid except on notice to the donor and with the consent of the court;
(c) the donor may not extend or restrict the scope of the authority conferred by the instrument and no consent orinstruction given by the donor after registration shall, in the case of a consent, confer any right and, in the case of an instruction, impose or confer any obligation or right on or create any liability of the attorney or other persons having notice of the consent or instruction.
(2) Subsection (1) applies for so long as the instrument is registered whether or not the donor is for the time being mentally capable.
(3) On registration of an enduring power the Registrar of Wards of Court shall supply an attested copy of the enduring power to the donor and any persons who were given notice under paragraph 2 of the First Schedule of the application for registration.
(4) Members of the public may inspect the register free of charge during normal office hours.
(5) A document purporting to be a copy, attested by an officer of the Office of Wards of Court, of an instrument registered under this Act shall be evidence of the contents of the instrument and of the fact that it has been so registered.
(6) Subsection (5) is without prejudice to section 21 (proof by certified copies) and to any other method of proof authorised by law.
Functions of court with respect to registered power.
12.—(1) Where an instrument has been registered the court shall, on application to it by the donor, the attorney or any other interested party, as the case may be, have the functions set out in subsections (2) to (6).
(2) The court may—
(a) determine any question as to the meaning or effect of the instrument;
(b) give directions with respect to—
(i) the management or disposal by the attorney of the property and affairs of the donor;
(ii) the rendering of accounts by the attorney and the production of the records kept by the attorney for that purpose;
(iii) the remuneration or expenses of the attorney, whether or not in default of or in accordance with any provision made by the instrument, including directions for the repayment of excessive, or the payment of additional, remuneration;
(iv) a personal care decision made or to be made by the attorney;
(c) require the attorney to furnish information or produce documents or things in his or her possession as attorney;
(d) give any consent or authorisation to act which the attorney would have to obtain from a mentally capable donor;
(e) authorise the attorney to act for the attorney’s own benefit or that of other persons than the donor otherwise than inaccordance with section 6 (4) and (5) (but subject to any conditions or restrictions contained in the instrument);
(f) where appropriate, relieve the attorney wholly or partly from any liability incurred or which may have been incurred on account of a breach of duty as attorney.
(3) On application on notice to the attorney made for the purpose by or on behalf of the donor, the court shall confirm the revocation of the power if satisfied that the donor has done whatever is necessary in law to effect an express revocation of the power and was mentally capable of revoking a power of attorney at the time of the purported revocation.
(4) The court may cancel the registration of an instrument in any of the following circumstances, that is to say—
(a) on confirming the revocation of the power under subsection(3) or consenting to a disclaimer under section 11 (1) (b);
(b) on giving a direction revoking the power on exercising any of its powers under the Lunacy Regulation (Ireland) Act, 1871 ;
(c) on being satisfied that the donor is and is likely to remain mentally capable;
(d) on being satisfied that the power has ceased to be in force by the death or adjudication in bankruptcy of the donor or by virtue of subsection (7) or (9) of section 5 or by the death or mental incapacity of the attorney or by virtue of section 5 (6);
(e) on being satisfied that the power was not a valid and subsisting enduring power when registration was effected;
(f) on being satisfied that, having regard to all the circumstances, the attorney is unsuitable to be the donor’s attorney;
(g) on being satisfied that fraud or undue pressure was used to induce the donor to create the power; or
(h) for any other good and sufficient reason.
(5) Where the court cancels the registration of an instrument on being satisfied of the matters specified in paragraph (f) or (g) of subsection (4) it shall by order revoke the power created by the instrument.
(6) On the cancellation of the registration of an instrument under subsection (4) (other than paragraph (c)) the instrument shall be delivered up to be cancelled, unless the court otherwise directs.
Protection of attorney and third person where registered power invalid or not in force.
13.—(1) Subsections (2) and (3) apply where an instrument which did not create a valid enduring power has been registered, whether or not the registration has been cancelled at the time of the act or transaction in question.
(2) An attorney who acts in pursuance of an enduring power which is not or no longer a valid power or which has ceased to be inforce shall not thereby incur any liability (either to the donor or to any other person) unless at the time of acting the attorney knows—
(a) that the instrument did not create a valid enduring power; or
(b) that an event has occurred which, if the instrument had created a valid enduring power, would have invalidated the power or caused it to cease to be in force; or
(c) that the instrument has been cancelled.
(3) Any transaction between the attorney and another person shall, in favour of that person, be as valid as if the power had then been in existence, unless at the time of the transaction that person has knowledge of any of the matters mentioned in subsection (2).
(4) Where the interest of a purchaser depends on whether a transaction between the attorney and another person was valid by virtue of subsection (3), it shall be presumed in favour of the purchaser unless the contrary is shown that the transaction was valid if—
(a) the transaction between that person and the attorney was completed within twelve months of the date on which the instrument was registered; or
(b) that person makes a statutory declaration, before or within three months after the completion of the purchase, that he or she had no reason at the time of the transaction to doubt that the attorney had authority to dispose of the property which was the subject of the transaction.
(5) For the purposes of section 18 (protection of attorney and third persons where action is taken under the power of attorney in ignorance of its having been revoked) in its application to an enduring power the revocation of which by the donor is by virtue of section 11 (1) (a) invalid unless and until confirmed by the court under section 12 (3), knowledge of the confirmation of the revocation is, but knowledge of the unconfirmed revocation is not, knowledge of the revocation of the power.
(6) In this section “purchaser” has the meaning assigned to it by section 18 (6) and “purchase” shall be construed accordingly.
Application to joint and joint and several attorneys.
14.—(1) An instrument which appoints more than one person to be an attorney may specify that the attorneys are appointed to act either jointly or jointly and severally. In default, the attorneys shall be deemed to have been appointed to act jointly.
(2) This Act, in its application to joint attorneys, applies to them collectively as it applies to a single attorney but subject to the modifications specified in subsection (3) and Part I of the Second Schedule .
(3) Where two or more persons are appointed (or are deemed to have been appointed) to act jointly, then, in the case of the death, incapacity or disqualification of any one or more of them, the remaining attorney or attorneys may continue to act, whether solely or jointly as the case may be, unless the instrument creating the power expressly provides to the contrary.
(4) This Act, in its application to joint and several attorneys, applies with the modifications specified in subsections (5) to (8) and in Part II of the Second Schedule .
(5) A failure, as respects any other attorney, to comply with the provisions of section 5 and regulations made thereunder shall prevent the instrument from applying in that attorney’s case without however affecting its efficacy as respects the other or others.
(6) Where one or more but not both or all the attorneys makes or joins in making an application for registration of the instrument then—
(a) an attorney who is not an applicant as well as one who is may act pending the determination of the application as provided in section 7 (2) (or under section 8 );
(b) notice of the application shall also be given under the First Schedule to the other attorney or attorneys; and
(c) objection may validly be taken to the registration on a ground relating to an attorney or to the power of an attorney who is not an applicant as well as to one or the power of one who is an applicant.
(7) The court shall not refuse under section 10 (4) to register an instrument because a ground of objection to an attorney or a power is established if an enduring power subsists as respects an attorney who is not affected thereby but shall give effect to it by the prescribed qualification of the registration.
(8) The court shall not cancel the registration of an instrument under section 12 (4) in any of the circumstances specified in that subsection if an enduring power subsists as respects an attorney who is not affected thereby but shall give effect to it by the prescribed qualification of the registration.
(9) In this section—
“prescribed” means prescribed by rules of court; and
“the requirements for the creation of enduring powers” means the provisions of section 5 other than subsections (5) to (10) and of regulations under subsection (2) of that section.
PART III
Powers of Attorney Generally
Creation of power.
15.—(1) Where an instrument creating a power of attorney is signed by direction of the donor it shall be signed in the presence of the donor and of another person who shall attest the instrument as witness.
(2) A power of attorney is not required to be made under seal.
(3) This section is without prejudice to any requirement in or under any other enactment as to the witnessing of powers of attorney or as to the execution of instruments by bodies corporate.
Effect of general power in specified form.
16.—(1) A general power of attorney in the form set out in the Third Schedule , or in a form to the like effect expressed to be made under this Act, shall operate to confer on the donee or donees of the power acting in accordance with its terms authority to do on behalf of the donor anything which the donor can lawfully do by attorney.
(2) This section does not apply to functions which the donor has as a trustee or personal representative or as a tenant for life within the meaning of the Settled Land Act, 1882, or as a trustee or other person exercising the powers of a tenant for life under section 60 of that Act.
Execution of instruments, etc. by donee of power.
17.—(1) The donee of a power of attorney may—
(a) execute any instrument with his or her own signature and, where sealing is required, with his or her own seal, and
(b) do any other thing in his or her own name,
by the authority of the donor of the power; and any instrument executed or thing done in that manner shall be as effective as if executed or done by the donee with the signature and seal, or, as the case may be, in the name, of the donor of the power.
(2) A person who is authorised under a power of attorney to convey any estate or interest in property in the name or on behalf of a corporation sole or aggregate may either execute the conveyance as provided in subsection (1) or, as donee of the power, execute the conveyance by signing his or her name as acting in the name or on behalf of the corporation in the presence of at least one witness and, in the case of a deed, by affixing his or her own seal, and such execution takes effect and is valid in like manner as if the corporation had executed the conveyance.
(3) Where a corporation aggregate is authorised under a power of attorney to convey any interest in property in the name or on behalf of any other person (including another body corporate), a person appointed for that purpose by the corporation may execute the deed or other instrument in the name of such other person; and where an instrument appears to be executed by a person so appointed then in favour of a purchaser the instrument is deemed to have been executed by that person, unless the contrary is shown.
(4) In this section “purchaser” has the meaning given to it by section 18 (6).
(5) This section applies whenever the power of attorney was created.
Protection of donee and other persons where power revoked.
18.—(1) A donee of a power of attorney who acts in pursuance of the power at a time when it has been revoked shall not, by reason of the revocation, incur any liability (either to the donor or to any other person) if at that time the donee did not know that the power had been revoked.
(2) Where a power of attorney has been revoked and a person, without knowledge of the revocation, deals with the donee of the power, the transaction between them shall, in favour of that person, be as valid as if the power had then been in force.
(3) Where the power is expressed in the instrument creating it to be irrevocable and to be given by way of security then, unless the person dealing with the donee knows that it was not in fact given by way of security, that person shall be entitled to assume that the power is incapable of revocation except by the donor acting with the consent of the donee and shall accordingly be treated for the purposes of subsection (2) as having knowledge of the revocation only if that person knows that it has been revoked in that manner.
(4) Where the interest of a purchaser depends on whether a transaction between the donee of a power of attorney and another person was valid by virtue of subsection (2), it shall be presumed in favour of the purchaser unless the contrary is shown that that person did not at the material time know of the revocation of the power if—
(a) the transaction between that person and the donee was completed within twelve months of the date on which the power came into operation, or
(b) that person makes a statutory declaration, before or within three months after the completion of the purchase, that that person did not at the material time know of the revocation of the power.
(5) Without prejudice to subsection (3), for the purposes of this section knowledge of the revocation of a power of attorney includes knowledge of the occurrence of any event (such as the death of the donor) which has the effect of revoking the power.
(6) In this section “purchaser” means a purchaser in good faith for valuable consideration and includes a lessee, mortgagee or other person who, for valuable consideration, acquires an interest in any property; and includes also an intending purchaser.
(7) This section applies to a power of attorney whenever created but only to acts and transactions after the commencement of this section.
Protection of transferee under stock exchange transaction.
19.—(1) Without prejudice to section 18 , where—
(a) the donee of a power of attorney executes, as transferor, an instrument transferring registered securities, and
(b) the instrument is executed for the purposes of a stock exchange transaction,
it shall be presumed in favour of the transferee unless the contrary is shown that the power had not been revoked at the date of the instrument if a statutory declaration to that effect is made by the donee of the power on or within three months after that date.
(2) In this section “registered securities” and “stock exchange transaction” have the same meanings as in the Stock Transfer Act, 1963 .
Power given as security.
20.—(1) Where a power of attorney is expressed to be irrevocable and is given to secure—
(a) a proprietary interest of the donee of the power, or
(b) the performance of an obligation owed to the donee,
then, so long as the donee has that interest or the obligation remains undischarged, the power shall not be revoked—
(i) by the donor without the consent of the donee, or
(ii) by the death, incapacity or bankruptcy of the donor or, if the donor is a body corporate, by its winding-up or dissolution.
(2) A power of attorney given to secure a proprietary interest may be given, and shall be deemed to have been capable always of being given, to the person entitled to the interest and persons deriving title under that person to that interest, and those persons shall be duly constituted donees of the power for all purposes of the power but without prejudice to any right to appoint substitutes given by the power.
(3) This section applies to powers of attorney whenever created.
Proof of instrument creating power.
21.—(1) A power of attorney may be proved by production of the original instrument or of a copy which—
(a) is certified by the donor of the power or by a solicitor or member firm (within the meaning of the Stock Exchange Act, 1995 ), or in such other manner as the court approves, to be a true copy of the original, or
(b) where the instrument has been deposited in the Central Office of the High Court pursuant to section 22 is attested in accordance with that section.
(2) It is immaterial for the purposes of subsection (1) how many removes there are between the copy and the original or by what means (which may include facsimile transmission) the copy produced or any intermediate copy was made.
(3) This section is without prejudice to any other method of proof authorised by law.
Deposit of original instruments in Central Office.
22.—(1) An instrument creating a power of attorney, its execution being verified by affidavit, statutory declaration or other sufficient evidence, may, with the affidavit or declaration, if any, be deposited in the Central Office of the High Court.
(2) A separate file of instruments so deposited shall be kept and any person may, free of charge during normal office hours, search that file and inspect any instrument so deposited, and an attested copy thereof shall be delivered to that person on request.
(3) A copy of an instrument so deposited may be presented at the Central Office, and may be stamped or marked as an attested copy, and when so stamped or marked shall become and be an attested copy.
(4) An attested copy of an instrument so deposited shall without further proof be sufficient evidence of the contents of the instrument and of the deposit thereof in the Central Office.
(5) Subsections (2)to (4)apply to instruments deposited in the Central Office before the commencement of this section.
(6) This section applies to instruments creating powers of attorney whenever executed.
Furnishing to purchaser of power relating to land.
23.—A purchaser of any estate or interest in land is entitled to have any instrument creating a power of attorney which affects title thereto, or a certified copy or attested copy thereof, furnished by the vendor to the purchaser free of expense.
PART IV
Miscellaneous
Laying of orders and regulations before Houses of Oireachtas.
24.—Every order and regulation made under this Act shall be laid before each House of the Oireachtas as soon as may be after it is made and, if a resolution annulling the order or regulation is passed by either such House within the next subsequent twenty-one days on which the House has sat after the order or regulation is laid before it, the order or regulation shall be annulled accordingly but without prejudice to the validity of anything previously done thereunder.
Repeals.
25.—Each enactment specified in the Fourth Schedule is hereby repealed to the extent specified in the third column of that Schedule.
FIRST SCHEDULE
Notification prior to Registration
Sections 9 , 10 , 14 .
PART I
Duty to give Notice to Donor and Other Persons
Duty to give Notice to Donor
1. (1) Subject to subparagraph (2), before making an application for registration the attorney shall give notice of intention to do so to the donor.
(2) Paragraph 4 (2) shall apply in relation to the donor as it applies in relation to a person who is entitled to receive notice under this Schedule.
Duty to give Notice to Other Persons
2. (1) Subject to paragraph 4—
(a) if regulations under section 5 (2) have required notice of the execution of an enduring power of attorney to be brought to the attention of specified persons, the attorney shall, before making an application for registration, give notice of intention to do so to those persons;
(b) if any of those persons is dead or mentally incapable or his or her whereabouts cannot be reasonably ascertained, the attorney shall give notice of intention to make such an application to the other person or persons, and
(c) if all those persons are dead or mentally incapable or their whereabouts cannot be reasonably ascertained, the attorney shall, before making such an application, give notice of intention to do so to the persons (if any) who are entitled to receive notice by virtue of paragraph 3.
(2) When giving notice pursuant to subparagraph (1) the attorney shall also give notice to the Registrar of Wards of Court of intention to apply to the court for registration of the enduring power.
3. (1) Subject to the limitations contained in subparagraphs (2) to (4), persons of the following classes are entitled to receive notice under paragraph 2 (1) (c):
(a) the donor’s husband or wife;
(b) the donor’s children;
(c) the donor’s parents;
(d) the donor’s brothers and sisters, whether of the whole or half blood;
(e) the widow or widower of a child of the donor;
(f) the donor’s grandchildren;
(g) the children of the donor’s brothers and sisters of the whole blood;
(h) the children of the donor’s brothers and sisters of the half blood.
(2) A person is not entitled to receive notice under this paragraph if the name or address of that person is not known to and cannot be reasonably ascertained by the attorney.
(3) Except where subparagraph (4) applies, no more than three persons are entitled to receive notice by virtue of this paragraph and, in determining the persons who are so entitled, persons falling within class (a)of subparagraph (1) are to be preferred to persons falling within class (b) of that subparagraph, persons falling within class (b) are to be preferred to persons falling within class (c) of that subparagraph; and so on.
(4) Notwithstanding the limit of three specified in subparagraph (3), where—
(a) there is more than one person falling within any of classes (a) to (h) of subparagraph (1), and
(b) at least one of those persons would be entitled to receive notice by virtue of this paragraph,
then, subject to subparagraph (2), all the persons falling within that class are entitled to receive notice by virtue of this paragraph.
4. (1) An attorney shall not be required to give notice under paragraph 2 to himself or herself or to any other attorney under the power who is joining in making the application, notwithstanding that he or she or, as the case may be, the other attorney is entitled to receive notice by virtue of paragraph 3.
(2) In the case of any person who is entitled to receive notice under this Schedule, the attorney, before applying for registration, may make an application to the court to be dispensed from the requirement to give that person notice; and the court may grant the application if it is satisfied—
(a) that it would be undesirable or impracticable for the attorney to give such notice; or
(b) that no useful purpose is likely to be served by giving it.
PART II
Contents of Notices
5. A notice to the donor under this Schedule—
(a) shall be in the prescribed form or a form to the like effect;
(b) shall state that the attorney proposes to make an application to the court for the registration of the instrument creating the enduring power in question; and
(c) shall inform the donor that, whilst the instrument remains registered, any revocation of the power by the donor will be ineffective unless and until the revocation is confirmed by the court.
6. A notice to any other person under this Schedule—
(a) shall be in the prescribed form or a form to the like effect;
(b) shall contain the statement mentioned in paragraph 5 (b);
(c) shall inform the person to whom it is given that that person may object to the proposed registration by notice in writing to the Registrar of Wards of Court before the expiry of the period of five weeks beginning with the day on which the notice under this Schedule was so given; and
(d) shall specify, as the grounds on which an objection to registration may be made, the grounds set out in section 10 (3).
7. In this Part, “prescribed” means prescribed by regulations which may be made by the Minister.
PART III
Duty to give Notice to other Attorneys
8. (1) Subject to subparagraph (2), before making an application for registration an attorney under a joint and several power shall give notice of intention to do so to any other attorney under the power who is not joining in making the application; and paragraphs 4 (2)and 6 shall apply in relation to attorneys entitled to receive notice by virtue of this paragraph as they apply in relation to persons entitled to receive notice under this Schedule.
(2) An attorney is not entitled to receive notice by virtue of this paragraph if his or her address is not known to and cannot be reasonably ascertained by the applying attorney.
PART IV
Supplementary
9. For the purposes of this Schedule a notice given by post may be sent by prepaid registered post to the usual or last known place of residence of the person to whom it is to be given and shall be regarded as given on the day on which it was posted.
SECOND SCHEDULE
Joint and Joint and Several Attorneys
Section 14 .
PART I
Joint Attorneys
1. In section 5 (4), the reference to the time when the attorney executes the instrument shall be read as a reference to the time when the second or last attorney executes the instrument.
2. In sections 5 (5), 8 , 10 (3), 12 (2) and 12 (4), references to the attorney shall be read as including references to any attorney under the power and, in the case of section 12 (4) (d), subject to section 14 (3).
PART II
Joint and Several Attorneys
3. The expiry of an enduring power of attorney effected in the circumstances mentioned in section 5 (7) shall apply only so far as it relates to an attorney who is the spouse of the donor.
THIRD SCHEDULE
Form of General Power of Attorney
Section 16 .
FOURTH SCHEDULE
Enactments Repealed
Cases
Panorama Developments (Guildford) Ltd v Fidelis Furnishing Fabrics Ltd
[1971] 2 QB 711
Lord Denning MR
“ Mr. Hames, who appears for the Fidelis company, takes two points. His first point is that the contracts for hire were made with Mr. Bayne personally and not with the company: and so the company are not liable on them. He points out, quite rightly, that, on the face of each of these hiring agreements, the hirer is specifically stated to be “R. L. Bayne.” He says that they were regular documents, duly executed, which were intended to embody the agreement that was made: and Belgravia cannot gainsay them. I was much impressed by that argument. It appears that in these “self-drive hire” transactions, Belgravia, for insurance purposes, always want the driver to be named as the hirer. So they deliberately inserted Mr. Bayne’s name as the hirer. Can they now go back on their own documents? Belgravia have to prove that the Fidelis company was in fact the party which hired the cars. For this, they have to go outside their own regular hiring agreements. Can they do this? I think they can. I regard these hiring agreements as part and parcel of a contract contained in correspondence: so much so that you must not look at the hire agreement alone, but at all that took place. “In order fairly to estimate what was arranged and agreed, … you must look at the whole of that which took place and passed between them”: see Hussey v Horne-Payne (1879) 4 App Cas 311, per Earl Cairns LC at p 316.
Applying those considerations, it is clear that these cars were hired as a result of letters which described Fidelis Furnishing Fabrics Ltd. as the contracting party. The cars were booked by letters written on the paper of the Fidelis company and signed by Mr. R. L. Bayne, with the words underneath “Company Secretary.” References were given as to the credit and standing of the Fidelis company. In these circumstances, the hiring agreements were mere machinery for carrying the correspondence into effect. One of them was overstamped with the signature: “Fidelis Furnishing Fabrics Ltd. – R. L. Bayne, Company Secretary.” Clearly that agreement was with the company. It would be absurd to draw a distinction between that agreement and the others. The contract for each of them was with the company and not with Mr. Bayne.
Mr. Hames’ second point is this: he says that the company is not bound by the letters which were signed by Mr. Bayne as “Company Secretary.” He says that, on the authorities, a company secretary fulfils a very humble role: and that he has no authority to make any contracts or representations on behalf of the company. He refers to Barnett, Hoares & Co v South London Tramways Co (1887) 18 QBD 815 where Lord Esher M.R. said at p. 817:
“A secretary is a mere servant; his position is that he is to do what he is told, and no person can assume that he has any authority to represent anything at all; …”
Those words were approved by Lord Macnaghten in George Whitechurch Ltd v Cavanagh [1902] AC 117, 124. They are supported by the decision in Ruben v Great Fingall Consolidated [1906] AC 439. They are referred to in some of the textbooks as authoritative.
But times have changed. A company secretary is a much more important person nowadays than he was in 1887. He is an officer of the company with extensive duties and responsibilities. This appears not only in the modern Companies Acts, but also by the role which he plays in the day-to-day business of companies. He is no longer a mere clerk. He regularly makes representations on behalf of the company and enters into contracts on its behalf which come within the day-to-day running of the company’s business. So much so that he may be regarded as held out as having authority to do such things on behalf of the company. He is certainly entitled to sign contracts connected with the administrative side of a company’s affairs, such as employing staff, and ordering cars, and so forth. All such matters now come within the ostensible authority of a company’s secretary.
Accordingly I agree with the judge that Mr. R. L. Bayne, as company secretary, had ostensible authority to enter into contracts for the hire of these cars and, therefore, the company must pay for them. Mr. Bayne was a fraud. But it was the company which put him in the position in which he, as company secretary, was able to commit the frauds. So the defendants are liable. I would dismiss the appeal, accordingly.”
Salmon LJ
The secretary ‘is the chief administrative officer of the company’ so he has ostensible authority with administrative matters. Nothing is more natural than ‘ordering cars so that its servants may go and meet foreign customers at airports, nothing to my mind, is more natural than that the company should hire those cars through its secretary.’ It might not be so with matters of commercial management of the company, for example, a contract for the sale or purchase of goods in which the company deals’ but that was not the case here.
Crean v. Deane.
Lavery J. [1959] IR 348
30 July 1958
On the 16th May, 1954, a match of bowls between John Cronin and Ted Murphy was played as the first round of An Tóstal Bowl-playing Championship. This competition was organised by a body called the All Ireland Bowl-players’ Association but effectively this game appears to have been conducted by a local committee. The game of bowls (which was known to me in my youth as “bullet throwing”) is played on the highway over a course of two or three miles with heavy iron balls which the competitors roll or throw along the roadway much as the game of golf is played, and scored, the winner being the player who completes the course in the fewer number of throws.
As one might expect, in addition to any cup or prize which may be played for, the supporters of each player put up stakes which are paid to the backers of the winner.
The procedure as described in the evidence is that a collector on each side takes the stakes of the backers of his man and the sums put up must be equal on each side.
These stakes are then given to a stakeholder who holds them until the game is decided and then pays over the total sum to the collector of the winning side who distributes it to his subscribers in proportion to their contributions.
Effectively, it is an even money bet made by each contributor.
The plaintiff, Joseph Crean, was the collector for the backers of John Cronin and he collected the sum of £80 10s. 0d. in varying amounts from them.
The collector for the Murphy party collected an equal sum and the two sums of £80 10s. 0d. were handed to the stakeholder, the defendant, James Deane, to hold till the event was decided and then to pay over the whole to the collector for the winning party for distribution by him.
The match was duly started but when it reached a point about half a mile from the finishing point Cronin gave up as he said that his wrist got weak and he couldn’t play on as he had no control over the bowl. At that point he was about eighty or ninety yards behind Murphy. In the terms of the game, he was a “throw of odds behind” but not a”bowl of odds behind.”
Cronin and his backers demanded that the points reached by each player should be marked and that the game should be continued and completed on another day.
The committee of four or five were present and in control. They were defendant, Mr. Deane, and Messrs. Shea, McSwiney and Barry and possibly another. The committee said that the game should be finished in one day and they asked Cronin to go on but he said he couldn’t as his “hand was at him”; that he couldn’t finish that day but would finish another day. The committee went up the road and had a talk and returned and said that they had decided that Murphy had won and that they had awarded the “score”(the term for a match) and the stake to Murphy. The plaintiff gave evidence that he said (I quote) “the score isn’t finished and if it is not to be finished another day we want our money back.” He says that the defendant said that he was only one of the committee and that he would hold the money over.
There was evidence that attempts were made to arrange for the continuation of the game but the committee adhered to their decision that Murphy had won.
There were certain rules and conditions signed by the players and rule 4 provides that in the event of a dispute the committee’s decision is final, but this rule appears to relate to a particular matter. In any game, however, there must be an official or officials to control the conduct of the game and to decide the result and those taking part either as competitors or backers must be considered to have agreed to accept their decision.
The rules also provide that “decisions made by the Association in all matters relating to the Tóstal Bowl-playing Championship scores are final.”
By letter of the 14th June, 1954, Mr. James F. Cadden, Honorary Secretary to All Ireland Bowl-players’ Association wrote to John Cronin:”The Committee and members of above Association have instructed me to inform you that ‘stake money’ held since 16th May, 1954, is to be paid over to the winner of score, Mr. T. Murphy, of Togher on Thursday, 17th June, 1954.”
There is no doubt in my opinion that Murphy was the winner and that as a matter of contract the stakes were payable to his backers.
There was, according to the evidence, a discussion at a meeting subsequent to the date of this letter but it cannot in my opinion affect the issue.
The claim is to recover from the defendant as stakeholder the sum of £80 10s. 0d. collected by the plaintiff and deposited with the defendant.
The plaintiff scarcely denies that according to the bargain made by him and the other subscribers, this sum belongs to Murphy’s backers. It cannot be denied. The plaintiff relies on a proposition of law which is thus stated in Cheshire and Fifoot on the Law of Contract (3rd ed., 1952, at p. 268):”Where the two wagering parties, A. and B., each deposit a stake with X. to abide the event, the legal position of X. is that he is the agent of A. with regard to A.’s stake and the agent of B. with regard to B.’s stake. In each case his authority is the same, namely, to pay the money to the winner. The rule of agency law relevant to this case is that if an agent acts within the scope and during the continuance of his lawful authority the principal is bound, but that if he exercises the authority after it has been revoked he is liable to his principal for the consequences.”
“The effect of this upon a wagering contract in which stakes are deposited is that, notwithstanding the determination of the event upon which the wager turns, either party may require the repayment of his stake before it has been paid away in accordance with his former instructions. If the loser makes no demand until his stake has been paid to the winner, his right of recovery is gone, for the stakeholder has merely exercised the authority actually conferrod upon him. If, on the other hand, the loser demands the return of his money before it has been paid to the winner, the stakeholder is personally liable if he disregards the revocation of his authority and hands the stakes to the winner.”
This principle of revocation of authority where the authority is not irrevocable is of general application as between principal and agent and has no particular relation to gaming contracts.
The Gaming Acts would only have to be considered as matter of defence and it is well established that the illegality of the subject-matter of the contract does not prevent the recovery of money held by a stakeholder notwithstanding that the event was a game: O’Sullivan v. Thomas (1).
The Gaming Acts would also of course prevent the successful parties from recovering by action the opponents’ stakes from the stakeholder, but this does not arise.
The relevant law applicable between principal and agent is thus stated in Halsbury’s Laws of England (Hailsham Ed.), vol. I, para. 503 et seq.:
“503. Subject to the cases of irrevocable authority already referred to,” [the present case is not one] “agency can be terminated either by agreement between principal and agent, or by the principal giving notice of revocation to the agent, or by the agent renouncing his authority.
504. Notice of revocation may be given at any time before the authority is wholly exercised, subject to any right to damages on the part of the agent for breach of contract . . . Money paid to an agent by his principal under authority to devote it to a specific purpose, is recoverable at any time before the purpose has been carried out even though paid to abide the event of a wager.”
These propositions are fully supported by many authorities cited.
In the present case, in my opinion, the principals are the several subscribers to the Cronin stake and the agent is the stakeholder, the defendant, James Deane.
An alternative view which would not alter the position is that the plaintiff was agent for these subscribers to make the deposit with the stakeholder.
The question therefore is, did these subscribers or any of them revoke the defendant’s authority to pay over the stake or part of it before he had paid it over under his authority?
The statements attributed to the subscribers or some of them none of whom are identifiedthat they wanted their money back are not related to the money being paid over if the score was decided and Murphy was the winner, but were based on the demand that the score should be completed on another day and that if this were not done that it remained undecided.
This indeed was the basis on which the evidence proceeded and is the basis on which it is pleaded in the civil bill, namely, that the money was paid on a consideration which wholly failed.
I have decided that the event was decided and that the consideration did not fail. It was, however, an illegal consideration which renders the claim to the stake by the winners unenforceable in law.
I do not find any evidence that the subscribersother than the plaintiffdecided to default on their sporting obligations and in pursuance of that decision revoked the defendant’s authority or authorised the plaintiff to do so on their behalf.
Such a decision would require proof. The plaintiff is entitled to default in respect of his personal obligations but he is not entitled to make the others defaulters.
The plaintiff’s contribution to the stake was £6. The plaintiff said that some of the subscribers had asked him for their money and that a number of them had not.
The demand of those who did ask may have been related to the contention that the event had not been decided and the evidence is not sufficient to establish that they wanted their money back if on the terms on which they laid down their stakes the money was payable to the backers of the winner.
In my opinion the plaintiff is entitled to a decree for the sum of £6, being the amount staked by him.
Kilgobbin Mink Ltd. v. National Credit Co.
Hamilton J.
[1980] IR 176 H.C.
Hamilton J.
16th February 1978
The facts in this case may be summarised as follows. The plaintiff company is a limited liability company which was incorporated under the Companies Act, 1963, on the 30th August, 1966. By an indenture of lease dated the 31st December, 1973, the premises known as No. 24 Suffolk Street in the city of Dublin were demised by the defendants to the plaintiffs for the term of 21 years from the 1st December, 1973, subject to the yearly rent of £5,400. By an indenture dated the 15th August, 1968, the plaintiffs issued a debenture to the Provincial Bank of Ireland Ltd. to secure all monies then due or thereafter to become due or owing by the plaintiffs to the Provincial Bank on any account whatever whether as principal or surety, and did therein charge with such payments, first, all and every the hereditaments and premises and all and every estate and interest therein or relating thereto or in or to any part thereof and whether legal or equitable which the plaintiffs then had or might thereafter acquire or become entitled to and, secondly, its undertaking in all other its property and assets for the time being both present and future including its uncalled capital, goodwill and book debts. On the 7th February, 1975, the interest of the Provincial Bank in the debenture was vested in Allied Irish Banks Ltd.
The plaintiffs were in breach of the covenants and conditions contained in the lease of 1973 and the defendants instituted proceedings for the recovery of the demised premises and for recovery of unpaid rent. Those proceedings were compromised by an agreement whereby the plaintiffs agreed to surrender their interest in the demised premises in consideration of the defendants waiving all arrears of rent and paying to the plaintiffs the sum of £8,500. No deed of surrender was executed but possession of the premises was delivered to the defendants on the 23rd January, 1975.
The defendants’ solicitor had insisted that such surrender of possession would be preceded by a resolution of the plaintiffs to that effect. At a meeting of the plaintiffs on the 22nd January it was resolved that the lease of 1973 be surrendered to the defendants in consideration of all arrears of rent being waived by the defendants, who were also to stay all proceedings against the plaintiffs and their guarantors. It was decided that the plaintiffs would vacate the demised premises on the 14th February, 1975. At the meeting it was further agreed that Mr. Leonard be authorised by the plaintiffs to surrender the lease.
When the lease had been surrendered and possession of the premises delivered to the defendants, the defendants allowed Mr. Leonard into occupation of part of the premises on foot of a caretaker’s agreement, and it was agreed that the payment of the sum of £8,500 would not be made by the defendants until Mr. Leonard had delivered up possession of the premises to the defendants. Mr. Leonard entered into occupation of the premises in pursuance of the caretaker’s agreement.
On the 24th January, 1975, Mr. Leonard wrote to the defendants as follows:
“Dear Sirs,
Would you be so kind as to direct debit the £8,500 agreed owing to ourselves, to Anglo Irish Bank, 50 Merrion Square, Dublin on the 14th day of February, 1975, to the account of Beau Monde Limited. Yours faithfully,
B.P. Leonard.”
That letter was written on notepaper headed “Beau Monde-A subsidiary of Kilgobbin Mink and Stud Farms Limited” but the words “Beau Monde-A subsidiary of” had been crossed out.
On the 24th January, 1975, the defendants’ solicitors wrote to the managing director of the Anglo Irish Bank at 50 Merrion Square, Dublin, as follows:
“Re: National Credit Company
Dear Sir,
We act for National Credit Company Limited who have authorised us to undertake on their behalf that when vacant possession of the ground floor and basement of No. 24 Suffolk Street Dublin is given up to our clients by Mr. Brian Leonard, which it is anticipated would be within 4 weeks from today, our clients will lodge the sum of £8,500 to the credit of Beau Monde Limited with you.
Yours faithfully,
Hickey, Beauchamp, Kirwan & O’Reilly.”
As of the 30th January, 1975, there was due and owing by the plaintiffs to Allied Irish Banks the sum of £154,000.16 and on the 7th February, 1975, Allied Irish Banks (in pursuance of the powers conferred on them by the debenture dated the 15th August, 1968) appointed Mr. Kevin Briscoe F.C.A. to be receiver and manager of the property and assets of the plaintiff company, as charged by the said debenture, upon the terms and subject to the powers and provisions contained in, and conferred by, the conditions endorsed on the debenture.
Mr. Leonard, on his own behalf or on behalf of the plaintiffs or of Beau Monde, had continued trading in the premises and was engaged there in the sale of the goods.
Subsequent to his appointment as receiver and manager, Mr. Briscoe on the evening of the 7th February visited the demised premises but did not see either Mr. Leonard or Mr. McEnroe, the directors of the plaintiff company. However, he did see Mrs. McEnroe (the wife of one of the directors) and he informed her that he had been appointed receiver and manager by Allied Irish Banks. On the following morning Mr. Briscoe called to the premises where he interviewed Mr. McEnroe and informed him that he, Mr. Briscoe, had been appointed receiver and manager by Allied Irish Banks. Subsequently Mr. Leonard came to the premises and joined in the conversation; he informed Mr. Briscoe that he, Mr. Leonard, was a caretaker of the premises and that the stock on the premises was not the property of the plaintiff company. At no stage did Mr. Leonard disclose to Mr. Briscoe that there was a sum of £8,500 owing to the plaintiffs as part of the consideration for the surrender of the lease of the premises.
On the 10th February, 1975, notice of the appointment of Mr. Briscoe as receiver and manager of the assets of the plaintiff company was filed in the Companies Office, and a further notice of the appointment was advertised in the Irish Independent newspaper on the 11th February, 1975.
Between the 8th and 10th February, 1975, the stock, goods and chattels were removed from the demised premises and, on the evening of the 10th February, 1975, Mr. Leonard handed over the keys of the premises to Mr. Moran who received them on behalf of the defendants. As Mr. Moran anticipated that the keys would be handed over on that date when all the goods and chattels had been removed from the demised premises, on that evening he had lodged the sum of £8,500 in the Anglo Irish Bank to the credit of Beau Monde in accordance with the authorisation given in Mr. Leonard’s letter dated the 24th January, 1975, and in pursuance of the undertaking given to the Anglo Irish Bank by the defendants’ solicitors on that date.
On the basis of these facts the receiver submits that the payment by the defendants of £8,500 to Beau Monde did not discharge the indebtedness of the defendants to the plaintiffs. Accordingly, the plaintiffs claim a declaration that the defendants are indebted to the plaintiffs in the sum of £8,500 as being the purchase money payable by the defendants to the plaintiffs in respect of the surrender of the demised premises by the plaintiffs to the defendants on the 23rd January, 1975; and a declaration that the defendants, in paying the said sum of £8,500 to Beau Monde on the 10th February, 1975, did not discharge the defendants’ liability to pay the same to the plaintiffs.
As appears from their defence, the defendants contest the plaintiffs’ claim on the grounds that by virtue of the terms of the letter dated the 24th January, 1975, the plaintiffs had relinquished their claim against the defendants; that the undertaking given by the defendants through their solicitors to the Anglo Irish Bank in the letter dated the 24th January, 1975, discharged the plaintiffs’ claim against the defendants for the said sum of £8,500; and that the assets of the plaintiffs which were charged by the debenture did not include the liability of the defendants to pay to the plaintiffs the sum of £8,500.
In their reply the plaintiffs allege (inter alia) that the letter dated the 24th January, 1975, directing the defendants to pay the sum of £8,500 to the account of Beau Monde in the Anglo Irish Bank was written and sent without the authority of the plaintiff company; that it constituted no more than a revocable authority to the defendants to pay the sum of £8,500 to the account of Beau Monde and that the said authority was revoked on the 7th February, 1975, by the appointment of Mr. Briscoe as receiver; and that there was no consideration for the undertaking of the defendants’ solicitors and that it did not create a binding obligation. By way of further reply to the defendants’ defence, the plaintiffs state: “If the said letter dated the 24th day of January, 1975, was written and sent with the authority of the plaintiff (which is denied) it did not constitute any authority to the defendant to lodge a cheque in the sum of £8,500 in Anglo Irish Bank Ltd. to the credit of Beau Monde Ltd. on the 10th day of February, 1975, as was done, since the said letter did not authorise payment until the 14th February, 1975, and did not authorise payment in this manner.”
With regard to the authorisation given to the defendants by Mr. Leonard’s letter of the 24th January, 1975, to pay the £8,500 to the Anglo Irish Bank, Mr. Blayney, on behalf of the plaintiffs, submitted that Mr. Leonard had no authority from the plaintiffs to authorise the payment of the amount due in this fashion; that such authorisation was not binding on the plaintiffs; and that, even if Mr. Leonard had such authority, it constituted no more than a revocable authority and that such authority was revoked by the appointment of Mr. Briscoe as receiver and manager of the plaintiff company on the 7th February, 1975, before payment had been made on foot of the authorisation.
In the course of his judgment in Moss Steamship Co. Ltd. v. Whinney 1 ,Lord Atkinson said at p. 263 of the report:
“This appointment of a receiver and manager over the assets and business of a company does not dissolve or annihilate the company, any more than the taking possession by the mortgagee of the fee of land let to tenants annihilates the mortgagor. Both continue to exist; but it entirely supersedes the company in the conduct of its business, deprives it of all power to enter into contracts in relation to that business, or to sell, pledge, or otherwise dispose of the property put into the possession, or under the control of the receiver and manager. Its powers in these respects are entirely in abeyance.”
In effect, the receiver steps into the shoes of the company and does not acquire any rights which the company itself does not possess. As stated by Mr. Justice Kenny in Murphy v. Revenue Commissioners 2 , it was held by the Court of Appeal in England in Rother Iron Works Ltd. v. Canterbury Precision Engineers Ltd. 3 that the debenture holder could not be in a different or better position than the company which issued the debenture.
The appointment of Mr. Briscoe as receiver and manager of the plaintiff company operated as an equitable assignment of the plaintiffs’ assets, including their rights (if any) under the agreement made between them and the defendants for the surrender of the plaintiffs’ interest in the premises demised by the lease of 1973. That agreement had been entered into and the disputed authorisation had been given prior to the crystallisation of the debenture holder’s charge and the equitable assignment of the plaintiffs’ rights under the said agreement which occurred on the appointment of the receiver.
Irrespective of whether the authorisation contained in Mr. Leonard’s letter of the 24th January, 1975, initially constituted a revocable or an irrevocable authority to the defendants to pay the money in the manner set forth therein, I am satisfied that the plaintiffs became estopped from revoking that authority when the defendants’ solicitors wrote to the Anglo Irish Bank on that date and undertook, on behalf of the defendants, to lodge with that bank the sum of £8,500 to the credit of Beau Monde when vacant possession of the ground floor and basement of the demised premises was given to the defendants.
Mr. Buckley, the solicitor for the defendants, had been authorised by Mr. Moran, of the defendant company, to give the said undertaking and, while it is not clear from the evidence, it is safe to infer that this was done at the request of Mr. Leonard.
It seems to me that once this undertaking was given on behalf of the defendants it was not open to the plaintiff company or the receiver, who was in no different or better position than the plaintiff company, to revoke this authority provided that Mr. Leonard was acting within the scope of his authority, as agent of the plaintiff company, in giving the authority in the first instance and in requesting the defendants to give the said undertaking. Consequently it appears to me that the real question for determination by me is whether Mr. Leonard was acting within the scope of his authority, whether actual or ostensible, from the plaintiff company in (a) giving the authority to the defendants as contained in his letter of the 24th January, 1975, and (b) in requesting the defendants to give the undertaking contained in their solicitor’s letter of that date.
On behalf of the defendants, Mr. Barron submitted that Mr. Leonard, as chairman and director of the plaintiff company, had actual authority to enter into the said agreement and to authorise the defendants to pay the balance of the consideration, namely, £8,500 to the credit of Beau Monde in the Anglo Irish Bank. Alternatively, he submitted that Mr. Leonard was held out by the plaintiff company as having ostensible authority to do so and that the plaintiff company is estopped from denying responsibility for his acts.
In order to rely on the doctrine of ostensible authority, it is essential that the person who claims the benefit of it must (a) prove that he relied upon the ostensible authority which he sets up and (b) show that he was not put upon enquiry as to whether the transaction was in order.
On behalf of the plaintiffs, Mr. Blayney submitted that the nature of the transaction was such as to put Mr. Moran and Mr. Buckley on enquiry as to whether the transaction was in order as it could not be considered to be an ordinary transaction where money due to one company was authorised to be paid to another company.
I have read and considered carefully all the authorities opened to me by counsel and found them of considerable assistance. The questions which I have to determine are partly questions of fact and partly questions of law. So far as the facts are concerned, it is clear from the evidence of Mr. Briscoe that Mr. Leonard was the chairman of the plaintiff company which had an issued share capital of 50,000 shares; that Mr. Leonard held 49,999 of these shares and that Mr. McEnroe was the managing director of the plaintiff company and held the remaining issued share; that Mr. Leonard held the majority of the issued shares in Beau Monde; and that Beau Monde was trading in the demised premises though the lease was held by the plaintiff company. It is clear from the evidence of Mr. Moran that all the dealings between the plaintiffs and the defendants were conducted by Mr. Leonard on behalf of the plaintiffs. It is true that the resolution of the plaintiff company (required by Mr. Buckley because no deed of surrender was being executed) authorises Mr. Leonard to surrender the lease but is silent with regard to the consideration for the surrender and the manner of its disposal.
As stated by Willmer L.J. in Freeman & Lockyer v. Buckhurst Park Properties (Mangal) Ltd. 4 at p. 488 of the report: “Actual authority might, of course, be either express . . . or it might be implied . . .” Though there is no resolution of the plaintiff company authorising Mr. Leonard to dispose of the £8,500 in the manner in which he did, I am satisfied, having regard to all of the evidence, that he did have such actual authority and that this can be implied from the facts that he was the chairman of the plaintiff company and one of the two directors of the company, that he was the holder of all but one of the issued shares of the company, and that he was the person expressly authorised by the plaintiff company to surrender the lease to the defendants. I am also satisfied that Mr. Leonard had ostensible authority to direct or authorise payment of the £8,500 in the manner in which he did authorise that payment, and that the defendants relied on such ostensible authority to make the payment in the manner in which they did.
While on the surface it may appear to be unusual that an amount due to the plaintiff company should be directed to be paid to the credit of another company, in the circumstances of this particular case it was not so unusual as to put the defendants on enquiry as to the extent of Mr. Leonard’s authority because, as appears from Mr. Moran’s evidence, Beau Monde were trading in the premises which were being surrendered.
If a receiver had not been appointed and if the plaintiff company had sued the defendants for the sum of £8,500, I cannot see how any court would be entitled to hold in favour of the plaintiff company. The receiver is in no different or better position than the plaintiff company. Consequently, in my opinion the plaintiff company’s claim fails and I must dismiss the action.