Unrealized Powers

I think most folks are guilty of using templates of contracts, merely updating pertinent information (i.e., names and addresses) and without knowing what some clauses mean.

An example is found in most SPAs (Special Power Attorney): "with the power of substitution and revocation," generally written at the bottom of the SPA.

This clause means that the attorney-in-fact can pass on his "powers" to another person by executing a second SPA.

For example, if Broker A was named attorney-in-fact (AIF) to transfer a title but couldn't because of schedule conflicts, he could execute another SPA naming Broker B to do it in his place. To do this, he'll have to introduce Broker A as an AIF in the heading. It goes something like this...

"Principal A, who is being represented by Broker A by virtue of Special Power of Attorney acknowledged before Notary Public ________, Makati City Notary Public, entered into as Doc. No. ___, Page No. ___, Book No. ____, Series 2023...

...do hereby irrevocably appoint, name, and constitute Broker B...to be my true and lawful attorney..."

For more critical SPAs (e.g., power to sign Deeds of Absolute Sale; power to receive payment), I suggest removing this clause since we want to keep the powers to solely the people we know and trust.