Legal Aspects of Irrevocable Contract and Power of Attorney Deeds
In Bangladesh, Contract Deeds and Power of Attorney (PoA) Deeds play a crucial role, particularly in matters involving property, business, and financial transactions. When both parties sign these deeds and explicitly declare irrevocable, specific laws govern their validity and enforceability. This article discusses the legal framework, protections, and relevant regulations related to the irrevocability of these deeds.
Legal Protection for Contract Deeds
1. The Contract Act, 1872
2. The Specific Relief Act, 1877
Power of Attorney Deeds: Irrevocability
1. The Power of Attorney Act, 2012
2. The Registration Act, 1908
3. The Specific Relief Act, 1877
Ways to Prevent Cancellation
1. Include Clear Irrevocability Clauses:
2. Ensure Registration:
3. Seek Legal Assistance:
Conclusion
Legal Protection for Contract Deeds
A contract deed is a legally binding document executed with the consent of both parties. In many cases, one party may attempt to unilaterally cancel the contract. To protect against such actions, the following legal provisions apply:
1. The Contract Act, 1872
• Section 10:
A contract is valid if made with the free consent of both parties, for lawful consideration, and a lawful purpose. Once executed, it is binding on both parties.
• Section 62:
A contract can only be altered, rescinded, or waived by mutual agreement.
• No party can unilaterally cancel the contract.
2. The Specific Relief Act, 1877
• Section 21:
Courts can order specific performance of a contract, especially when monetary compensation is insufficient.
• Section 27:
A contract cannot be canceled unless there is fraud, misrepresentation, or illegality.
Power of Attorney Deeds: Irrevocability
A Power of Attorney deed is particularly significant in matters of property or financial representation. It allows the designated attorney to act on behalf of the principal (grantor).
1. The Power of Attorney Act, 2012
• Section 4(2):
If a PoA is executed for valuable consideration and declared irrevocable, it cannot be unilaterally canceled. Even after the death or incapacity of the principal, such a PoA remains valid if the attorney has acted on it.
2. The Registration Act, 1908
• Section 17(1)(b):
Registration of a PoA involving immovable property is mandatory. This strengthens its legal validity and enforceability.
3. The Specific Relief Act, 1877
• Section 42:
If one party attempts to cancel an irrevocable PoA, the other party may seek a declaratory decree from the court affirming its validity and enforceability.
Ways to Prevent Cancellation
1. Include Clear Irrevocability Clauses:
Explicitly state in the deed that it is “irrevocable” and “non-cancelable” to ensure legal protection.
2. Ensure Registration:
For PoAs and deeds involving immovable property, registration is mandatory to secure their validity and legal protection.
3. Seek Legal Assistance:
If any party attempts to cancel the deed, file a suit under the Specific Relief Act, 1877, to enforce or protect the agreement.
Conclusion
Legal protection for contract and Power of Attorney deeds is essential to avoid unilateral cancellations. In Bangladesh, the Contract Act, 1872, Power of Attorney Act, 2012, and Specific Relief Act, 1877, provide clear guidelines on this matter. To ensure the validity of such deeds, it is crucial to follow legal provisions and seek professional legal assistance when needed. “Make a good introduction for the article.“
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