• CR Advocates LLP
• Civil Litigation
• August 30, 2024

ASSET PROTECTION IN KENYA; POWER OF ATTORNEY

A power of attorney (POA) is a legal document that grants one person (the attorney) authority to act on behalf of another person (the donor). This authority can extend to various matters, including financial transactions, property management, and healthcare decisions. In Kenya, POAs are governed by the Land Registration Act 3 of 2012. This presentation will delve into the intricacies of POAs and their role in asset protection in Kenya, examining relevant laws and legal precedents.

Creation of a Power of Attorney in Kenya

A POA is typically created by the donor in writing. It should clearly state the attorney’s authority, the duration of the POA, and any specific conditions or limitations. The POA should be signed by the donor in the presence of a witness, who should also sign the document.

Execution of a Power of Attorney

To execute a POA, the donor must:

1. Sign the document: This is done through appending a signature or thumbprint or any other mark of evidence of personal acceptance.  (Sec 44 of the Land Registration Act)

1. Have mental capacity: The donor must have the mental capacity to understand the nature and consequences of the POA. A person of unsound mind has no capacity to donate a power of attorney. This is as was the case in Grace Wanjiru Munyinyi  And  Another v  Gedion Waweru And   Others (2002) Eklr, where the court stated where a  person purports that he has a power of attorney donated to him by a person of unsound mind, the power is null in law
2. Be free from undue influence: The donor must not be coerced or manipulated into signing the POA.

Verification of a Power of Attorney

A power of attorney (POA) is typically verified by a Land registrar. This witness can be a notary public, a commissioner of oaths, or another authorized person. The executing parties appear before the registrar with a witness for verification.  The witness role is to confirm the identity of the donor and ensure that they are signing the POA voluntarily and with sound mind.

Key Requirements for a Power of Attorney in Kenya

• Donor and Attorney Information: Full names and addresses of both must be stated.
• Legal Execution: The POA must comply with Kenyan law.
• Signatures: The donor must sign the POA, witnessed by someone not involved in the POA.
• Corporate Entities: If the donor is a company, the POA must be executed under seal.
• Stamp Duty and Registration: The POA must be stamped (payment of stamp duty) and registered in the Register of Powers of Attorney under the Registration of Documents Act.
• Appointment of a Company: A company can be appointed as an attorney.
• Multiple Donors/Attorneys: Several people can appoint the same attorney or join in one POA.
• Company-Issued POA: If issued by a company, a copy of its Memorandum and Articles of Association and a resolution authorizing the POA must be presented.

Registration of a Power of Attorney in Kenya

Once execution is done, the executing parties appear before the registrar with a witness for verification. (Section 45 of the Land Registration Act) Registration then occurs when stamp duty is paid in regards to the Power of Attorney stamp duty and the Registrar makes an entry in the Register of Powers of Attorney under the Registration of Documents Act.

Registration is beneficial for several reasons:

• Public Record: Registration creates a public record of the POA, which can be useful in case of disputes or challenges to the attorney’s authority.
• Notice to Third Parties: Registration can serve as notice to third parties, such as banks, financial institutions, and property managers, that the attorney has the authority to act on the donor’s behalf.
• Protection against Fraud: Registration can help prevent fraudulent activities by providing a verifiable record of the POA.

Foreign Powers of Attorney

For a foreign Power of Attorney to have authority in Kenya, it must be registered here in Kenya   even if it is procedurally duly registered in its country of origin. A Notary Public stamp from the embassy of the country of origin in Kenya will be required to verify its authenticity. If it is in another language, a Certificate   from the country’s embassy verifying   the interpretation must be obtained and presented.

Companies and Powers of Attorney

A power of Attorney can be issued by and given to a company. If the Power of Attorney has been issued by a company, a copy of the Memorandum and Articles of Association of the company and a company resolution authorizing the same must be presented. The Power of Attorney must be executed under Seal.

Types of Powers of Attorney in Kenya

There are several types of POAs in Kenya, each with specific limitations and authorities:

1. General Power of Attorney: This grants the attorney broad authority to act on behalf of the donor in most matters, including managing property, making financial decisions, and entering into contracts.
2. Enduring Power of Attorney: This is a special type of POA that remains valid even if the donor becomes mentally incapacitated. It is commonly used for long-term asset planning and healthcare decisions.
3. Springing Power of Attorney: This becomes effective only under specific circumstances, such as when the donor becomes mentally incapacitated or is unable to communicate.

CONCLUSION

The power of attorney is a crucial legal instrument in Kenya, providing individuals and entities with the flexibility to delegate authority and manage their affairs effectively. By understanding the key requirements, types, and legal implications of POAs, individuals can ensure that their assets are protected and their wishes are carried out as intended.

Here at CR Advocates LLP you will find dedicated professional who will work with you towards achieving and protecting your interest in your properties. By doing so, you can mitigate potential risks and ensure that your assets are managed effectively, both during your lifetime and beyond.

“The information provided in this article is intended for general legal advice and does not constitute legal advice for any specific transaction or case. Since each transaction presents a unique legal context, it is advisable to retain a legal adviser for specific transactions.”

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