Russia

Article 174. Consequences of Limitation of Powers to Conclude Transaction

If the powers of a person to conclude a transaction have been limited by a contract or the powers of an organ of a legal person by its constituent documents in comparison with those as determined in a power of attorney, in a law, or which may be considered obvious from the situation in which the transaction was concluded, and when concluding it such person or organ exceeded these limitations, the transaction may be deemed by a court to be invalid upon the suit of the person in whose interests the limitations were established only in instances when it can be proved that the other party to the transaction knew or knowingly should have been aware of the said limitations.

CHAPTER 10. REPRESENTATION. POWER OF ATTORNEY

Article 182. Representation

1. A transaction concluded by one person (representative) in the name of another person (person represented) by virtue of authority based on a power of attorney, specification of a law, or act of an empowered State agency or local self- government agency shall directly create, change, and terminate civil rights and duties of the person represented. A power also may be manifest from the situation in which a representative acts (retail seller, cashier, etc.).

2. Persons acting, although in the interests of others but in their own name (commercial intermediaries, trustees in bankruptcy, executors in a will, etc.). , as well as persons authorized to enter into negotiations concerning possible future transactions, shall not be representatives.

3. A representative may not conclude transactions in the name of the person represented with respect to himself personally. He also may not conclude such transactions with respect to another person whose representative he is simultaneously, except in the instances of commercial representation.

4. Concluding a transaction which by its character may be concluded only personally, and likewise other transactions specified in a law, shall not be permitted.

Article 183. Conclusion of Transaction by Unauthorized Person

1. In the absence of powers to act in the name of another person or in the event of exceeding such powers, a transaction shall be considered concluded in the name and in the interests of the person who concluded it unless the other person (person represented) subsequently approves expressly this transaction.

2. Subsequent approval of a transaction by the person represented shall create, change, and terminate civil rights and duties for him with regard to the particular transaction from the moment of its conclusion.

Article 184. Commercial Representation

1. A person who permanently and autonomously is representing in the name of entrepreneurs when they conclude contracts in the sphere of entrepreneurial activities shall be a commercial representative.

2. The simultaneous commercial representation of various parties in a transaction shall be permitted by consent of these parties also in other instances provided for by law. In so doing the commercial representative shall be obliged to perform the commissions given to him with care of a normal entrepreneur.

A commercial representative shall have the right to demand payment of stipulated remuneration and compensation for expenses incurred by him when performing a commission from the parties to the contract in equal shares unless otherwise provided by agreement between them.

3. A commercial representation shall be effectuated on the basis of a contract concluded in writing and stating the powers of the representative, and in the absence of such statement, also a power of attorney.

A commercial representative shall be obliged to preserve the secrecy of the information made known to him concerning trade transactions also after the fulfillment of the commission given to him.

The particulars of commercial representation in individual spheres of entrepreneurial activity shall be established by a law and other legal acts.

Article 185. Power of attorney

1. A power of attorney shall be deemed to be a written authorization issued by one person to another person for representation to third persons. The written authorization to conclude a transaction by a representative may be granted by the person represented directly to the respective third person.

2. A power of attorney to conclude transactions requiring a notarial form must be notarially certified, except for the instances provided for by a law.

3. There shall be equated to notarially certified powers of attorney:

  • powers of attorney of military servicemen and other persons being treated in military hospitals, sanatoriums, and other military treatment institutions certified by the head of such institution, his deputy for medical affairs, and the senior or duty doctor;
  • powers of attorney of military servicemen, and in centers for the stationing of military units, formations, establishments, and military training institutions where there are no notarial offices or other agencies which perform notarial functions, also the powers of attorney of workers and employees, members of their families and members of the families of military servicemen certified by the commander (head) of this unit, formation, establishment, or institution;
  • powers of attorney of persons in places of confinement certified by the head of the respective place of confinement;
  • powers of attorney of legally capable citizens of full age who are in institutions for social protection of the populace which are certified by the administration of this institution or the director (or his deputy) of the respective agency of social protection of the populace.

    4. A power of attorney to receive earnings and other payments connected with labor relations, to receive royalties of authors and inventors, pensions, grants and scholarships, deposits of citizens in banks, and to receive correspondence, including monetary and parcel, may also be certified by the organization in which the entruster works or studies, by the housing-operations organization at his place of residence, and by the administration of the inpatient treatment institution in which he is being treated.

    A power of attorney for a representative of the citizen to receive the latter's deposit in the bank, sums of money from his bank account, correspondence addressed to him at post offices, as well as to effect in the citizen's name other transactions specified in paragraph one of this point, may be certified by the respective bank or post office. Such power of attorney shall be certified free of charge.

    5. A power of attorney in the name of a legal person shall be issued signed by its director or other person authorized by the constituent documents to do so, with the seal of this organization affixed.

    A power of attorney in the name of a legal person based on State or municipal property for the receipt of issuance of money and other property valuables must be also signed by the chief (senior) bookkeeper of this organization.

    Article 186. Duration of Power of Attorney

    1. The duration of a power of attorney may not exceed three years. If the period has not been specified in the power of attorney, it shall retain force for one year from the date of the issuance thereof.

    A power of attorney in which the date of its issuance has not been specified shall be null.

    2. A power of attorney certified by a notary and intended for the fulfillment of operations abroad, without its duration specified, shall retain force until the revocation thereof by the person who has issued the power of attorney.

    Article 187. Transfer of Power of Attorney

    1. A person to whom a power of attorney was issued must personally perform the actions for which he is authorized. He may transfer the power of attorney to perform them to another person if authorized to do so by the power of attorney or forced to do so by virtue of circumstances in order to protect the interests of the person who issued the power of attorney.

    2. The person who transferred the power of attorney to another person must notify the person who issued the power of attorney thereof and communicate to him necessary information about the transferee of the powers. The failure to perform this duty shall impose on the transfer of powers responsibility for the actions of the transferee as they were his own.

    3. A power of attorney issued by way of transfer must be notarially certified except for the instances provided for by Article 185(4) of this Code.

    4. The duration of a power of attorney issued by way of transfer may not exceed the duration of the power of attorney on the basis of which it was issued.

    Article 188. Termination of Power of Attorney

    1. The effect of a power of attorney shall terminate as a consequence of:

    • expiry of the duration of the power of attorney;
    • revocation of the power of attorney by the person who issued it;
    • renunciation by the person to whom the power of attorney was issued;
    • termination of the legal person in whose name the power of attorney was issued;
    • termination of the legal person to whom the power of attorney was issued;
    • death of the citizen who issued the power of attorney, deeming him to be legally incapable, partially capable, or missing;
    • death of the citizen to whom the power of attorney was issued, deeming him to be legally incapable, partially capable, or missing.

    2. The person who issued the power of attorney may any time revoke the power of attorney or the transfer of the power of attorney, and the person to whom the power of attorney was issued, to renounce it. An agreement concerning the waiver of these rights shall be null.

    3. The transfer of a power of attorney shall lose force with the termination of the power of attorney.

    Article 189. Consequences of Termination of Power of Attorney

    1. A person who issued a power of attorney and subsequently revoked it shall be obliged to notify the person to whom the power of attorney was issued about the revocation thereof, as well as third persons known to him and with respect to whom the power of attorney was issued for representation. The same duty shall be imposed on legal successors of the person who issued the power of attorney in instances of the termination thereof on the grounds provided for in Article 188(1), subpoints (4) and (6), of this Code.

    2. The rights and duties which arose as a result of the actions of the person to whom the power of attorney was issued before this person knew or should have known about its termination shall remain in force for the person who issued the power of attorney and his legal successors with respect to third persons. This rule shall not apply if the third person knew or should have known that the validity of the power of attorney had terminated.

    3. Upon the termination of a power of attorney the person to whom it was issued or his legal successors shall be obliged immediately to return the power of attorney.

    Article 402. The Debtor's Responsibility for His Employees see also Remedies

    The actions of the debtor's employees, involved in the discharge of his obligation, shall be regarded as those of the debtor himself. The debtor shall be answerable for these actions, if they have caused the non-discharge or an improper discharge of the obligation.