How a foreign Power of Attorney could protect your overseas property purchase / sale

Whilst many owners of a foreign property know what documents they need to sell their foreign property, many neglect setting up Powers of Attorney or an equivalent document in order to have their selected “attorney” or “donor” be in a position to deal with their assets outside of the UK. In some cases, a UK power of attorney may be sufficient, but most nations and their citizens are simply not familiar with British legal documents and will almost always require the use of their own nations’ powers of attorney or equivalent documents.

Overseas property expert, Simon Conn, has reached out to his peers to comment on the importance of a Power of Attorney when protecting property and assets abroad.

When purchasing a property abroad, normally the buyer and seller need to appear in front of a Notary Public and sign the title deed or other documents personally in front of a notary who witnesses the signatures and the exchange. In many cases the buyers and sellers may see different notaries. Whilst there are around 150,000 practising solicitors in England & Wales, there are only around 770 notaries. If you are required to sign a power of attorney before a notary public, ensure you do not use a solicitor as in that case such documents may be invalid.

However, there can be situations where this becomes difficult when the buyer is unable to travel. A Power of Attorney provides legal authority for an attorney to deal with overseas affairs when an individual is not able of handling the matter in person. Regarding other nation and property transactions, individuals will not be able to use a UK Power of Attorney form as these will not be recognised abroad, which is why it is important to plan ahead with the correct documentation when purchasing or selling a property overseas.

Kevin Burke, Attorney and Notary at the Law Office of Kevin M Burke, explains: “Many companies that sell property abroad will have their own powers of attorney forms available for use by their customers. It is always recommended that you seek referrals to local lawyers in the relevant nation or local jurisdiction to draft a power of attorney that protects your interests and is not slanted in favour of such foreign companies.

“It is suggested that you should not hire a foreign entity who will handle everything for you. Often, such companies may charge far more than what such services might cost if you found separate entities to provide such services. You should ensure that the power of attorney has a termination date, and that you can easily cancel the power of attorney should you wish.”

Peter Esders, Legal Director and Solicitor at Judicare, explains the importance of who to grant authority to when considering a power of attorney: “A power of attorney document could be used to sign a title deed for a purchase or an inheritance, but could also be to represent you in court, represent you before tax authorities, and to make payments on your behalf. As you can imagine, you are giving quite a lot of power to the person appointed under a power of attorney so it has to be somebody you can trust. Normally this would be the lawyer acting for you, but it could be for example, a spouse if both of you cannot go to the country.

“Powers of attorney in Europe tend to work the same way. The clauses contained in the power tend to be quite wide and extensive. The reason for this is that if they find anything else that needs doing, they don’t want to come back to you to ask for another power of attorney to be signed because the original one wasn’t wide enough. However, there is a balancing act to be made because you don’t want the power to be too wide and contain unnecessary things in it.”

One way to mitigate this may be to have a power of attorney prepared for you in advance of any such transaction and by choosing someone you trust.

Conor Dalton, Solicitor at Seamus Maguire & Co. in Ireland, explains the process: “The standard period for a power of attorney is for one year but this can be adjusted to suit your requirements and setting one up is relatively straightforward.

“The document setting up a power of attorney is to be signed by the person granting the power of attorney, the donor, in the presence of a witness who should sign, print their name, address and occupation. It cannot be the person to whom the power of attorney is to be granted and does not have to be a solicitor but it is always advisable to take the advice of a solicitor before entering into any arrangement where legal powers are transferred to another.

“Additionally, if you are selling a property in Ireland, it is advisable to discuss the effect of a power of attorney with a solicitor as there are some limitations on their use for vendors.”

Generally, a power of attorney is used by appointing someone abroad – usually a lawyer or notary in the relevant country to draft a form for you which identifies the service to be performed and who is to perform it.

 The power of attorney in France, also known as “procuration” is a legal document that enables the purchasers to give the public notary the authority to execute the purchase and sale agreement and even the final deed.

Giovanni Lombardo, Avocato and Solicitor at Lewis Nedas Law, explains how to buy a property in Italy by way of a power of attorney:

“Italian Law allows any buyer and vendor to be represented in Italy by way of a power of attorney, known as procura speciale, which is issued by the Italian General Consulate of London (please note that this service is by appointment only, and it is reserved for Italian nationals). Another method is by way of a special power of attorney, executed before a UK Public Notary, and legalised at the Foreign Office with an apostille, and is perfectly valid in Italy.

“The proxy gives authority to the person named in the proxy, to represent the buyer/vendor in Italy, and to sign any legal conveyancing document on their behalf, before the Italian public notary. The special proxy (procura speciale) will be drafted in both Italian and English.”

Powers of attorney can be very useful in getting transactions completed when individuals cannot travel to appear in person. The individual should carefully grant a power of attorney to somebody trustworthy, who will be effectively acting as the individual in the final transaction. Powers of attorney should be limited to a set period of time, to only perform what is in fact required to be done, and to only permit a certain named person or persons who have in fact met to act as the attorney.

Finally, individuals should seek to protect their own interests and take legal advice if unsure. For more information and advice on moving abroad and taking the correct documentation, please contact Simon Conn at simon@simonconn.com or visit www.simonconn.com.