An adult with full contractual capacity is entitled to make decisions about his/her personal welfare, financial affairs and medical treatment. Sometimes a person with full contractual capacity may not be able to do something personally (for
example sign a document) because that person may, for example, be out of the country or not near the place where the act needs to be performed. In these cases, the person (“the principal”) can execute a power of attorney in favour of a third party (“the agent”), authorising the agent to perform the act on the principal’s behalf. The basic laws of agency apply to this relationship.
An adult who does not have full contractual capacity (whether through mental illness, intellectual disability, physical disability, head injury, an extended period of unconsciousness, stroke or extreme old age) requires assistance to make these decisions. This assistance is often provided by a curator appointed by the High Court.
What if principal dies or becomes insolvent?
When a principal dies or is sequestrated as a result of insolvency, all powers of attorney executed by him/her lapse.
The power to act on the principal’s behalf shifts on the principal’s death or insolvency from the principal to the Master of the High Court and thereafter, once Letters of Executorship (or Letters of Authority in the case of insolvency) are issued, to the principal’s executor or trustee respectively.
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