Power: Mandate and proxy

Our laws allow us to carry out the mandate, by which one person empowers another to execute for it certain legal acts. Unlike the mediation and brokerage contract, a lease of services or a labor contract, both the mandate and the power of attorney can be signed by individuals and professionals without a previous employment relationship, based on the trust and need to be represented in certain legal acts.

Let’s see in depth the figures of the mandate and the power as they are conceived in the Spanish Civil Code:

What is a mandate?

In the mandate, a person is obliged to carry out, on his own account or on behalf of another, acts or services relating to the management of one or more matters, with or without remuneration. Therefore, it is a power which purpose is to hire a person to provide a service or to do something, in his or her own name or on behalf of the represented.

In it two figures appear:

• The representative, who works in the name of another.
• The represented, the one on whose behalf it is acted.

An example of a mandate: a creditor who authorizes a person to process the collection of his debt.

Characteristics of the mandate

• Confidence.
• Free or paid.
• Requires acceptance of the representative.
• It creates specific obligations: the mandate generally conceived does not understand more than the acts of administration. In order to transmit, sell, mortgage or execute any other act of rigorous dominion, it is necessary express and written mandate. In this case, you must specify the capacity of action that is agreed.
• It can be with or without representation:

– Mandate without representation or simple, when there is no power and when, having it, the representative does not use it. It relates to third parties in its own name, acting on behalf of the represented but in its own name.

– A mandate with representation or representative, when the representative works on behalf of the represented and in the name of the Mandator. Manifesting its representation, it acts on behalf of the principal.

• The acts for which it is empowered may be of any kind, except for the represented’ personal obligations.

Representative’s obligations

1. Its fundamental obligation is the fulfillment of the order. 
2. Responsibility to the represented in the event of non-fulfilment of its obligations: in the case that the representative does not carry out the contract in the mandate, he is responsible for the damages caused to the represented.
3. Responsibility in the case of a simple mandate: when the representative acts in his own name, the represented has no action against the people with whom the representative has contracted, nor have they against him. The contract doesn’t relate to them. 
4. Accountability: All representative is obliged to give account of his operations. They must also pay to the represented all that they have received for the contracts concluded.

Represented’s obligations

1. To pay the representative his remuneration, in cases where appropriate. 
2. To anticipate the payment to the representative of the amounts necessary for the execution of the mandate. If the representative had already anticipated amounts in order to carry out the mandate, the represented must reimburse them even if the business did not go well, provided that it was not the represented’s fault.
3. The represented must also indemnify the representative from all damages caused by the fulfilment of the mandate, if he was not guilty or committed imprudence.

Proxy or representation

The power contract is a power much like a mandate. The main difference is that the mandate is a contract for the realization of an obligation specified by the parties and therefore requires acceptance of the representative. While the power is a declaration of unilateral will of the one who wants to be represented. It does not require acceptance by the proxy because a specific obligation is not agreed, but general for various actions on behalf of the represented.

For example, the power to administer a company allows the proxy to sign agreements and contracts (contract obligations) on behalf of the represented.

Two figures appear in the proxy:

• The representative (proxy), who works on behalf of another. 
• The represented one (principal), that in whose name one acts.

Characteristics of the Proxy

• This contract gives the representative the power to act on behalf of the represented person. It gives him the power to conclude legal acts or businesses as if he had celebrated them. 
• Does not require acceptance by the representative. 
• In the contract it is delimited what kind of acts are allowed and which not, depending on whether the power is general or special. It has a certain margin of action.
• The representative hires on behalf of the person to whom he represents, therefore, the obligation binds the represented and the third with whom he contracts. 
• The representative is left out of the contract, responding only to his principal for those acts that exceed the power for which he was hired.

Use the proxy for:

• Desist from actions. 
• To give up rights on behalf of another person. 
• To assume or recognize obligations on behalf of a tax obligor. 
• To request an incomes return or reimbursement.

Mandate and proxy requirements

Both the mandate and the power only need a person who has precise instructions or faculties to carry out the same. They are also known as power, and although it is usually notarial, it does not have to be always so that its validity is recognised. In the rest, both figures have the same characteristics, even sometimes they are hired in a mixed way (as we saw before, the mandate with representation).

Form of mandate and proxy

Both the mandate and the power can be made:

• Express or tacitly. 
• In writing or verbal. 
• It must, in public document, have the power to marry, the general power for lawsuits and the specials to be presented at trial, the power to administer property and any other that has as its object an act drafted or It must be written in public deed, or it may harm third parties.

In order to authorize a person to carry out in his name minor administrative managements, you will be able to use our authorization models.