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What are the most common mistakes to avoid when drafting a Power of Attorney?

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Introduction
Common Mistakes to Avoid When Drafting a Power of Attorney 2.1. Lack of Clarity and Specificity 2.2. Insufficient Authority 2.3. Failure to Consider Duration and Scope 2.4. Lack of Proper Execution and Witnessing 2.5. Failure to Address Potential Conflicts of Interest 2.6. Lack of Consideration for Legal Capacity 2.7. Failure to Update the Power of Attorney
Conclusion

Introduction

A Power of Attorney (POA) is a legal document that grants an individual (the attorney-in-fact) the authority to act on behalf of another person (the principal). In Kenya, the legal framework for POAs is primarily governed by the Law of Property Act (Cap. 280) and the Law of Succession Act (Cap. 160). This document will explore the most common mistakes to avoid when drafting a POA in Kenya.

Common Mistakes to Avoid When Drafting a Power of Attorney

2.1. Lack of Clarity and Specificity

Source: The Law of Property Act (Cap. 280) emphasizes the importance of clear and specific language in legal documents.
Explanation: A poorly drafted POA can lead to confusion and disputes. The document should clearly define the specific powers granted to the attorney-in-fact. This includes specifying the types of transactions they are authorized to undertake, the assets or property covered, and the geographical limitations, if any.
Example: A POA that simply states "to act on my behalf" is insufficient. It should specify the specific actions the attorney-in-fact is authorized to perform, such as selling property, managing bank accounts, or making medical decisions.

2.2. Insufficient Authority

Source: The Law of Property Act (Cap. 280) requires that the POA grants sufficient authority to the attorney-in-fact to perform the intended actions.
Explanation: The POA should grant the attorney-in-fact the necessary authority to carry out the tasks assigned. If the POA is too restrictive, the attorney-in-fact may be unable to perform essential actions.
Example: If the POA only authorizes the attorney-in-fact to manage bank accounts but not to sell property, the attorney-in-fact will be unable to sell property even if it is necessary.

2.3. Failure to Consider Duration and Scope

Source: The Law of Property Act (Cap. 280) allows for POAs to be limited in duration and scope.
Explanation: The POA should clearly define the duration of the attorney-in-fact's authority. It should also specify the scope of the attorney-in-fact's powers, including any limitations or exceptions.
Example: The POA could specify that the attorney-in-fact's authority is limited to a specific period, such as during the principal's absence abroad. It could also specify that the attorney-in-fact is not authorized to make certain decisions, such as selling the principal's home.

2.4. Lack of Proper Execution and Witnessing

Source: The Law of Property Act (Cap. 280) requires that POAs be properly executed and witnessed.
Explanation: The POA must be signed by the principal in the presence of two witnesses who are not beneficiaries of the POA. The witnesses must also sign the document. Failure to comply with these requirements can render the POA invalid.
Example: If the principal signs the POA without witnesses or if the witnesses are beneficiaries of the POA, the POA may be challenged in court.

2.5. Failure to Address Potential Conflicts of Interest

Source: The Law of Property Act (Cap. 280) does not explicitly address conflicts of interest, but it is a general principle of law that agents must act in the best interests of their principals.
Explanation: The POA should address any potential conflicts of interest that may arise. For example, if the attorney-in-fact is also a beneficiary of the principal's estate, the POA should clearly state that the attorney-in-fact will act in the best interests of the principal and not their own.
Example: If the attorney-in-fact is a close friend of the principal, the POA should specify that the attorney-in-fact will not use their position to benefit themselves at the expense of the principal.

2.6. Lack of Consideration for Legal Capacity

Source: The Law of Property Act (Cap. 280) does not explicitly address legal capacity, but it is a general principle of law that individuals must have the legal capacity to enter into contracts.
Explanation: The POA should ensure that the principal has the legal capacity to grant the power of attorney. This means that the principal must be of sound mind and not under any undue influence.
Example: If the principal is suffering from a mental illness or is under the influence of drugs or alcohol, they may not have the legal capacity to grant a POA.

2.7. Failure to Update the Power of Attorney

Source: The Law of Property Act (Cap. 280) does not explicitly address the need to update POAs, but it is a general principle of law that legal documents should be kept up-to-date.
Explanation: POAs should be reviewed and updated regularly to reflect any changes in the principal's circumstances or wishes. This includes changes in the principal's health, financial situation, or family relationships.
Example: If the principal's health deteriorates, they may need to update the POA to grant the attorney-in-fact additional powers, such as the authority to make medical decisions.

Conclusion

Drafting a Power of Attorney in Kenya requires careful consideration of the legal requirements and potential pitfalls. By avoiding the common mistakes outlined above, individuals can ensure that their POAs are valid, enforceable, and protect their interests. It is always advisable to seek legal advice from a qualified lawyer when drafting or reviewing a POA to ensure that it meets the specific needs of the principal and complies with Kenyan law.