Notarization Rules for General and Special Power of Attorney in the Philippines

Introduction

In the Philippine legal system, a Power of Attorney (POA) is a written authorization that allows one person, known as the principal or grantor, to appoint another person or entity, referred to as the agent or attorney-in-fact, to perform acts or transactions on their behalf. This instrument is governed primarily by the Civil Code of the Philippines (Republic Act No. 386, as amended), particularly Articles 1868 to 1932, which outline the rules on agency. POAs are essential in various contexts, such as business transactions, real estate dealings, banking, and personal affairs, especially when the principal cannot personally attend to matters due to distance, illness, or other reasons.

POAs are classified into two main types: General Power of Attorney (GPA) and Special Power of Attorney (SPA). The notarization of these documents is a critical step to ensure their authenticity, enforceability, and admissibility as evidence in courts or before government agencies. Notarization transforms a private document into a public instrument, providing it with prima facie evidence of due execution and authenticity under the Rules on Notarial Practice of 2004 (A.M. No. 02-8-13-SC), as amended. Failure to notarize a POA when required can render it invalid for certain purposes, leading to potential legal disputes or rejection by third parties.

This article comprehensively explores the notarization rules for GPAs and SPAs in the Philippine context, drawing from statutory provisions, jurisprudence, and established notarial practices. It covers definitions, legal requirements, procedures, validity, and related considerations.

Distinction Between General and Special Power of Attorney

Understanding the difference between a GPA and an SPA is fundamental, as it influences the notarization requirements and the scope of authority granted.

General Power of Attorney (GPA): This grants broad and comprehensive powers to the agent to act on behalf of the principal in all matters, except those expressly excluded or requiring special authorization. Under Article 1877 of the Civil Code, a GPA is construed to include all acts of administration. Examples include managing properties, handling bank accounts, or conducting general business operations. However, a GPA does not automatically extend to acts of strict dominion (e.g., selling real property), which may require explicit mention or a separate SPA.
Special Power of Attorney (SPA): This is limited to specific acts or transactions explicitly enumerated in the document. Article 1878 of the Civil Code lists 15 specific acts that require an SPA, including:
1. Making gifts (except customary ones for charity or small value).
2. Loaning or borrowing money (unless urgent and indispensable).
3. Leasing real property for more than one year.
4. Binding the principal in partnerships or as a guarantor.
5. Obligating the principal for services without compensation.
6. Compromising, submitting to arbitration, or renouncing prescription rights.
7. Waiving obligations gratuitously.
8. Transferring rights to litigate.
9. Entering into contracts conveying or encumbering real property.
10. Making payments beyond ordinary administration.
11. Suing for collection of debts.
12. Ratifying obligations before the agency.
13. Any other act of strict dominion.

An SPA must be strictly interpreted, and the agent's authority is confined to what is expressly stated to prevent abuse.

Both GPAs and SPAs must generally be in writing to be valid (Article 1869, Civil Code), but notarization elevates their status, especially for acts involving real rights or public records.

Legal Basis for Notarization

Notarization of POAs is rooted in several key laws and rules:

Civil Code of the Philippines: Article 1874 requires that an agency for the sale of land or interest therein must be in writing; otherwise, the sale is void. For acts listed in Article 1878, an SPA is mandatory, and if the act requires a public document (e.g., sale of real property under Article 1358), the SPA must also be notarized or in public form.
Rules on Notarial Practice (2004, as amended): Issued by the Supreme Court, these govern notaries public. A notary must ensure the principal's voluntary execution, verify identity, and confirm capacity. Amendments, such as A.M. No. 02-8-13-SC and subsequent circulars, emphasize anti-fraud measures like competent evidence of identity (e.g., government-issued IDs).
Notarial Law (Act No. 2711, as amended): This outlines the qualifications and duties of notaries, requiring them to keep a notarial register and affix seals.
Public Documents Requirement: Under Article 1358 of the Civil Code, contracts that transmit, modify, or extinguish real rights over immovable property must appear in a public document to be enforceable against third parties. Thus, an SPA for such acts must be notarized.
Jurisprudence: Supreme Court decisions, such as in Cosmic Lumber Corporation v. Court of Appeals (G.R. No. 114311, 1996), affirm that an unnotarized SPA for real estate sales renders the transaction void. In Heirs of Amada Zaulda v. Zaulda (G.R. No. 201234, 2016), the Court stressed strict compliance with notarization for authenticity.

Notarization is not always mandatory for validity between principal and agent but is essential for third-party reliance and registration (e.g., with the Register of Deeds).

Requirements for Notarization

To notarize a GPA or SPA, the following must be satisfied:

Form and Content:
- The document must be in writing, clearly stating the principal's identity, the agent's powers, duration (if limited), and signatures.
- For SPA, specify the exact acts authorized to avoid ambiguity.
- Language: Preferably in English or Filipino, but any language understood by the principal is acceptable if translated.
Personal Appearance:
- The principal must personally appear before the notary (Rule IV, Sec. 2, Notarial Rules). Proxies are not allowed.
- If the principal is illiterate or cannot sign, thumbmarks or assisted signing is permitted, with witnesses.
Competent Evidence of Identity:
- At least one current government-issued ID with photo and signature (e.g., passport, driver's license, SSS ID). For foreigners, passport and alien certificate if applicable.
- Notaries must record ID details in the notarial register.
Capacity and Voluntariness:
- The principal must be of legal age (18+), sound mind, and not under duress. Notaries assess this through questioning.
- If the principal is a corporation, the board resolution authorizing the signatory is required.
Witnesses:
- Generally not required for acknowledgments, but advisable for added authenticity. For jurats (if the POA is under oath), two witnesses may be needed.
Fees:
- Notarial fees are regulated by the Supreme Court (e.g., P200-P500 for acknowledgments, per A.M. No. 08-1-12-SC). Overcharging is punishable.

For GPAs, the broad scope may invite scrutiny, so notaries often advise limiting powers. For SPAs involving real property, additional details like property descriptions (e.g., TCT number) are included.

Procedure for Notarization in the Philippines

The process is straightforward but must adhere to notarial protocols:

Drafting: Prepare the POA document, ensuring it complies with legal requirements. Templates are available from lawyers or online, but customization is recommended.
Execution: The principal signs the document in the presence of the notary or acknowledges a prior signature.
Notarial Act:
- Acknowledgment: For most POAs, this certifies that the principal appeared, acknowledged the document as their free act, and signed it. The notary affixes the notarial certificate, seal, and signature.
- Jurat: If the POA includes an oath (e.g., for affidavits within), a jurat is used.
Recording: The notary enters details in their notarial register, assigns a doc. no., page no., book no., and series.
Copies: The original is given to the principal; certified true copies can be issued later.

The entire process typically takes minutes at a notary's office, law firm, or government agency (e.g., DFA for consular notarization).

Notarization of POAs Executed Abroad

For Filipinos or transactions involving Philippine interests:

Consular Notarization: If executed before a Philippine consul, it is treated as notarized in the Philippines.
Apostille Convention: Since the Philippines joined the Hague Apostille Convention in 2019, POAs from member countries need only an apostille from the issuing country's authority (e.g., DFA-equivalent) to be valid here, replacing consularization.
Non-Member Countries: Require authentication by the foreign ministry, then consularization at the Philippine embassy/consulate.

Under Department of Foreign Affairs (DFA) rules, apostilled or consularized POAs are acceptable for use in the Philippines without further notarization.

Validity, Revocation, and Effects

Validity Period: POAs are valid until revoked, expired (if time-bound), or upon the principal's death/incapacity (Article 1919, Civil Code). Notarization does not affect duration but enhances enforceability.
Revocation: Must be in the same form as execution (e.g., notarized revocation for a notarized POA) and notified to the agent and third parties (Article 1921).
Effects of Notarization:
- Public document status: Presumed authentic and duly executed.
- Admissibility: No need for further proof in court unless contested.
- Third-Party Protection: Banks, registries, and agencies require notarized POAs for transactions.
Registration: For SPAs involving real property, register with the Register of Deeds for opposability to third parties.

Common Issues, Reminders, and Best Practices

Fraud Prevention: Notaries must vigilance against forgery; violations lead to disbarment or penalties.
Defects: Incomplete IDs or lack of personal appearance invalidate notarization.
Digital Notarization: As of 2023, remote online notarization (RON) is allowed under Supreme Court rules for certain acts, using video conferencing and e-signatures, but POAs require careful compliance.
Tax Implications: Documentary stamp tax (DST) applies (e.g., P15 per P200 of value under Revenue Regulations).
Legal Advice: Always consult a lawyer for drafting to avoid voids.
Updates: Notarial rules evolve; check Supreme Court issuances for amendments.

In summary, notarization ensures the integrity of GPAs and SPAs, safeguarding principals and third parties in the Philippine legal framework. Proper compliance mitigates risks and facilitates smooth transactions.