A Major Change to Powers of Attorney

February 2, 2015
The Supreme Court has ruled on the discrepancies in interpretation of the regulations governing the ability of registering the so-called inadequate joint power of attorney.
An inadequate joint power of attorney is understood as the power of attorney granted to an individual with a caveat that he or she can only act jointly with a board member or a partner but not another attorney in fact. Until now, courts have taken different stances on that issue, either accepting the possibility of granting such powers of attorney or criticizing it by refusing to make the entry in the register.
The ambiguity was eliminated by the resolution adopted by the seven judges of the Supreme Court on January 30, 2015 (III CZP 34/14) which stipulated that it was inadmissible for an entry in the register of entrepreneurs of the National Court Register to name a single attorney in fact with a caveat that he or she could only act together with a board member. This implies that attorneys in fact who have been granted joint powers of attorney can always act jointly with other attorneys in fact, and the limitation imposed to that extent is invalid.
In consideration of the adopted resolution, entrepreneurs who registered inadequate joint powers of attorney in the National Court Register should amend the entries in the register accordingly. Specific consequences of the ruling, regarding e.g. registration of a single holder of a joint power of attorney, application of inadequate joint powers of attorney in internal relations (without effect on third parties) or compulsory revision of internal acts and regulations (including document flow structure, as well as the rules governing representation and statements made by attorneys in fact) will come to light once the reasoning for the resolution is published.