Irrevocable notarial power of attorney for mortgage registration What is its power
A mother authorized her son to manage her bank account.
For the purpose of certification, she signed a notarial irrevocable power of attorney form under section 91 of the Bar Association Law, 1961.
This power of attorney is a form that is used by many lawyers and is published by the Bar Association. According to the language of this power of attorney , the son (the power of attorney) was authorized by his mother (the seal of the power of attorney) to make in “Block 30367 plot 39, which constitutes a plot of land in Mevaseret Zion” (hereinafter – “the property”), registered in the mother’s name , All or part of the following:
“Sell and transfer, lease, lease, [up to here the wording of the original form, and then, in lines where there is space, these words are printed]: mortgage, pledge, write a warning note, enter into contracts, take care of everything related to construction on the property listed below, apply for licenses And a building permit, to sign any document, including obtaining mortgages, in any matter relating to properties. “
Through the aforesaid notarial power of attorney, on June 26, 1997, a mortgage was registered in favor of the Bank, to secure credit for the son, with no limit on the amount. Accordingly, the Bank approved for the Company a receipt of credit, in the amount of $ 800,000.
A little later the son got into debt and the bank began the realization proceedings of the property.
In response to the realization proceedings, the mother submitted a request for declaratory relief to the Jerusalem District Court, in which she requests that the court determine that the said property is free from any lien.
In this application, the mother argued that the power of attorney was fraudulently removed from her, and that the entire purpose of the power of attorney, as explained to her by the notary, Advocate Alberto Schramm (hereinafter – “the notary”), was for construction purposes only, and the power of attorney does not allow The property to the bank, for a loan that is not for construction purposes. According to the mother, the bank acted in bad faith, and also violated its obligations to the mother, in accordance with the Banking Law and its regulations.
On February 19, 2007, her husband filed a claim for declaratory relief (H.P. 6052/07), in which the husband seeks from the court a judgment declaring that the husband owns half of the mother’s property, by virtue of the rule of cohabitation between spouses, and that the mortgages registered On the property of the mother, do not apply to the share of the husband in the property.
Irrevocable notarial power of attorney What were the main arguments of the mother
The mother claimed that following a decision to increase the construction percentage, the mother decided to demolish the building on the property, divide the property in two, and build 4 housing units on each lot. According to the mother, for this purpose, the mother gave the son a notarized power of attorney , which despite its title “irrevocable power of attorney”, is a “regular” power of attorney, i.e .: repeated, since there is no third party, which the power of attorney is given to ensure His rights.
According to the mother, the notary explained to her that the power of attorney is for construction only, and even added an addition to the power of attorney, from which it can be learned that it is given for this purpose. The mother points out that there was no stamp on the power of attorney, as it is, nor on a general power of attorney.
If you claim that the son used the power of attorney, to mortgage the property, and obtain credit for the purpose of his business, regardless of the promotion of construction on the lot. According to the mother, in accordance with the language of the power of attorney, the son was entitled, inter alia, to “handle everything related to construction on the property listed below, apply for licenses and a building permit …” (see: citation of the full section of the power of attorney, in paragraph 4 above). This language, should have “lit”, according to the mother, a “red light” among bank officials, and that they should have inquired directly with the mother, whether she agrees, for the mortgage of the property, for the business purposes of the son. The mother stated before the district court that it was clear to her son that the mother would not sign documents mortgaging the property in favor of the son’s business. According to the mother, the son even told the bank manager, Mr. Avi Katsav, that the mother would not agree to sign these documents, and was told to sign himself according to the power of attorney. According to the mother, in the actions and / or omissions of the bank, the bank violated its obligations to the mother, according to the Banking Law and its regulations, and also acted in bad faith.
According to the mother’s version, in accordance with section 6 (b) of the Mission Law, 1965 (hereinafter – “the Mission Law”), since the action was performed without permission, and since the action was not approved retrospectively, the bank must regard the son as its owner, or sue the son , For the damage caused to the bank.
The mother describes that since 1997, she believed that her son took care of the construction. According to the mother, only on February 25, 2004, did the applicant learn that the son was mortgaging the property in favor of the bank, and that a receiver had been appointed to sell the property.
In response, the mother sent a letter to the bank, in which she wrote that the operation was carried out without permission, and that the power of attorney was revoked and revoked.
Irrevocable notarial power of attorney What did the bank claim?
According to the bank, this is the son of the mother, who is empowered to act in connection with the property. The Bank opposes the cancellation of the mortgages, which were registered in favor of the Bank, since they were made on the basis of an irrevocable and unconditional notarial power of attorney, and the Bank was entitled to rely on it.
According to the bank’s version, in light of Company A’s application, controlled by the son, for obtaining bank credit, the son was required to provide collateral for the credit, and he, in response, offered to pledge the property to the bank, as collateral.
According to the bank, on June 26, 1997, the approval of the director of the area was received for the provision of credit, subject to the provision of collateral. According to the bank, as stated in the notary’s approval, on the same day, the mother signed with the notary an irrevocable power of attorney , which authorized the son’s power to act in accordance with the authorizations, including the mortgage on the property.
The bank continues and claims that on the same day, the son appeared at the bank branch, presented the power of attorney, authorizing the mortgage of the mother’s right in the property, and by virtue of this power of attorney, the property is mortgaged, in favor of the bank, in an unlimited first mortgage.
The power of attorney, by virtue of which the said mortgages were signed, is, according to the bank, of a broad wording, and its language explicitly also allows mortgages. According to the bank, this is an irrevocable, standard power of attorney, which authorizes the son to act as an owner, and by virtue of the said power of attorney, the son is authorized to sell, transfer, rent and lease the property.
The bank notes that on top of the power of attorney, typewritten additions were added (beyond the standard wording of the form, which includes the “sell and transfer, rent, lease” certification), according to which the son was expressly authorized to do the following:
“Mortgage, lien, write a warning note, enter into contracts, handle anything related to construction on the property listed below, apply for permits and building permit, sign any document, including obtaining mortgages, on any matter relating to properties.”
According to the bank, from the wording which was added specifically, it can be learned that the son was expressly authorized, also, to mortgage the property.
From the language of the power of attorney, it appears, according to the bank, clearly, unreservedly and unequivocally, that the mother authorizes the son to mortgage the property. According to the bank, the mother’s claim, regarding the bank’s deviation from the authorization, is an oral claim, against a document, and therefore the mother’s claim, regarding the deviation from the authorization, must be rejected.
Since, according to the language of the power of attorney, the son could even sell the property, the bank does not, according to the bank, accept the mother’s version, because the power of attorney is only intended to perform construction-related actions on the property.
According to the bank, in accordance with the rules of interpretation, the fact that the mother chose not to restrict the language of the power of attorney, works against her.
The date of the power of attorney also indicates, according to the bank, that it is possible for the purpose of preparing the mortgage, and not for the purpose of construction; Evidence that on the same day that the final approval was given by the area manager for the granting of the credit, the power of attorney was prepared and signed before the notary, and the mortgage deed was signed, by virtue of the said power of attorney.
The Bank notes that the mother’s claim that the power of attorney was intended for construction is an oral claim, against a written document, whose language is clear, contrary to what is stated in section 80 of the Ottoman Civil Procedure Law. This rule is fine, according to the Bank, especially in this case, where it is a notarized, irrevocable power of attorney, which by its very nature, is intended for use and reliance by third parties, who were not present at the time it was drafted.
According to the Bank’s Power of Attorney, section 19 of the Notaries Law, 1976, provides an evidentiary presumption as to the correctness of what is stated in a notary’s approval, which is given by law; therefore, he speaks for himself. In any case, strong on the notary who explained to the petitioner the nature of her signature on the power of attorney.
In support of his contention that there was no deviation from the authorization, the Bank notes the fact that the mother did not attach as respondents to the opening motion, neither the son, nor the notary, who made the power of attorney, and verified the mother’s signature on it.
The bank denies the mother’s claim that the son told the bank that the mother would not agree to sign a guarantee for the son’s business (see paragraph 24 above). In this regard, the Bank refers to the affidavit of Mr. Avi Katsav, Director of the Bank’s Branch.
The bank rejects the mother’s claims regarding the apartments of the power of attorney. According to the bank, as stated in its title, the power of attorney is irrevocable; Thus, any claim that the power of attorney is reprehensible, is an oral claim, against a written document. The Bank notes that, contrary to the mother’s claim, the non-existence of a third party does not constitute a ground for disqualifying the irrevocable power of attorney.
According to the Bank, even if it was not explicitly stated that the power of attorney is irrevocable, once the Bank relied on the power of attorney, and granted credit, based on a mortgage registered by virtue of that power of attorney, the said power of attorney became a power of attorney for a third party. Therefore, at least towards the bank, the power of attorney is irrevocable.
In this matter, the Bank adds that even if it were not for an irrevocable power of attorney, in this case, none of the cases leading to the termination of the mission would have taken place, according to section 14 (a) of the Mission Law.
At the end of his remarks, the bank claims that in accordance with his claims, the mortgages registered in favor of the bank were legally registered, and there is no reason to cancel them.
Therefore, the bank requests, from the court, to reject the opening motion, and to charge the mother, with the costs of the application and attorney’s fees, in addition to the lawful VAT.
Notarized power of attorney What did the husband ask for?
The husband requests from this court, a declaratory ruling, according to which the husband owns half of the rights in the property, by virtue of the rule of sharing the assets between spouses.
The husband also requests that the court determine that the husband is entitled to register as the owner of half of the rights in the property, and that the mortgages registered on the property do not apply to the husband’s share in the property, all according to the husband, according to a ruling in the Jerusalem Family Court (See: Appendix “C” to the claim for a declaratory judgment in HF 6052/07 above).
Finally, the husband asks the court to charge the bank with expenses and fees for the husband’s attorney, all on the assumption that the bank will oppose the request.
Reasons for the husband’s application
55. The husband further states that the mother inherited the property from her father, in 1977, or thereabouts. According to the husband, even though the property was inherited, it is a property that the parties saw and treated as part of the common property.
56. According to the husband, he and the mother are older people, who do not have separate property between them, and that the sharing requires, in this case, the issuance of a judgment, as requested.
57. The following is a description of the sequence of events, as explained by the husband:
A. On 30.8.79, the property was registered in the name of the mother.
B. On December 9, 2004, the husband petitioned the Jerusalem Family Court for a declaration that the husband owns half of the rights in the property, by virtue of the rule of cohabitation.
third. On December 28, 2006, a judgment was rendered by the Family Court (Judge Shlomo Elbaz), ruling that the husband is the owner of half of all the mother’s property, by virtue of the rule of cohabitation. The Family Court further ruled that “this judgment is at the level of the spouses’ internal relations, and it does not bind third parties.”
58. According to the husband, at the same time as filing the statement of claim in the Family Court, the husband revealed that the mother had given Ben an irrevocable notarial power of attorney. According to the husband, this irrevocable power of attorney was given without his knowledge, for the purpose of improvement and construction on the property only, while he knew that his wife intended to sign the said power of attorney, in a wording that would allow him to pledge for his mortgage to the bank.
59. It became clear to the husband, according to him, that the son used the power of attorney with the bank, in order to obtain credit, and everything not for construction purposes, for which purpose the power of attorney was granted.
60. According to the husband, only on February 25, 2004, the son told the applicant that he was mortgaging the property in favor of the bank, and that a receiver had been appointed to sell the property. Only then, did the husband learn of the two liens, which are imposed on the property, in favor of the bank.
61. The husband reiterates the claim that he did not know about the power of attorney, and therefore, in his view, there is no basis for applying the mortgage to the husband’s rights in the property, and no validity should be encumbered on them.
62. The husband supports the mother’s claims against the bank, and claims that the bank never informed the applicant or the husband about the use made of the power of attorney. According to the husband, in any case, with regard to the husband’s rights in the property, the mortgage should be annulled.
63. According to the husband, since he is entitled to half of the rights in the property, by virtue of the rule of cohabitation, and in light of the above judgment of the Family Court, and since the husband did not know that the mother gave the son the power of attorney, and since the bank did not check the husband’s rights And will not inform the husband about the use made of the power of attorney, the court is asked to order and rule that the husband is the owner of half the rights in the apartment, by virtue of Financial Relations Act and that the mortgages registered on the property, do not apply to the property.
General – The essence of the mission The essence of a power of attorney
The need for the mission institution stems from the fact that we have before us a “developing and open society, with extensive economic activity. In such a society, the person can not satisfy his needs or the needs of others by his own activity. In the existence of the institution of mission. The fulfillment of this need is also an expression of the autonomy of the private will. This time this desire is directed to granting power after acting in the name of or for the grantor of power ” And 1996), first volume, section 161, pp. 309-310;
Section 1 of the Courier Act provides that “a courier is a power of attorney of a courier to do in the name or place of a courier legal action against a third party.”
The essence of the mission is expressed in the sage’s utterance, which appears in the Babylonian Talmud, Tractate Kiddushin, page 2b, p. Ishot, Chapter C, Halacha Tu, as well as in the column, Hoshen Mishpat, Siman Kefev, and in Shulchan Aruch, in Rama, ibid., Section A; in the Halacha literature, according to the responsa project, this term appears in 540 sources): Of a man like him. ” From there, this statement of Hebrew law was copied, to section 2 of the Mission Law, which states that “the mission of a person like him, and the action of the mission, including his knowledge and intention, obligates and entitles, according to the matter, the mission” (see also: Barak, ibid., At section 191, p. ‘355, note 16).
Mission can be written or oral; Section 3 (a) of the Courier Act provides: “The courier is granted with the written or oral permission of the sender to send, or with notice thereof by the sender to the third party, or by the sender’s conduct toward one of them.”
A written mission is made by way of a sender signing a power of attorney.
A power of attorney is a legal instrument regulated by the Mission Law, and its function is to enable the proxy to perform legal action against a third party on behalf of his proxy, in accordance with what is agreed in the power of attorney.
In order for the third party to have assurance that the person before him is indeed authorized to commit in the name of the sender, section 3 (b) of the Mission Law stipulates that if a person is required to require the act of a messenger, he may not recognize the mission until written permission is given. from her”.
It should be emphasized that the meaning of the mission is that “the power of the messenger is to perform a legal action in the name of another or in his place” (Barak, ibid., At para. 204, at p. 375).
Prof. Aharon Barak explains that the purpose of the mission is “to grant rights and obligations directly to the sender, whose existence and identity are known to the third party. The test is objective. The question is not what the sender thought but how the third party perceived the action. , In the legal action of the sender, an action that is intended to create a direct legal connection between him and the sender … If we are right in this assumption, then it must be said that the sender acts ‘in the name’ of the sender even where subjectively of the sender he acts in his own name, provided Of the sender towards the third party created in the latter the reasonable thought that the sender acts in the name of the sender “(Barak, ibid., At section 205, p. 376; and see also the words of Prof. Zeev Zeltner, quoted there, next to note 98).
In other words, and in applying these principles to the case before us, we can say the following: In order for the power of attorney to be legally binding, the court must be satisfied that the power of attorney was signed by the mother of her own free will, like any other legal document. The power of attorney, including the consent of the stamp on the power of attorney, namely: the mother, because she authorizes her son, to register the mortgages on the property of the mother; From the point of view of the third party, the bank, it must be proved that the bank did understand the nature of the power of attorney, and agreed to provide credit and mortgage registration, assuming that the power of attorney allows a son to sign on behalf of the mother that the property will be pledged.
If indeed all this is proved, that then, the registration of the mortgages was indeed the fulfillment of the principle of mission and representation, by virtue of the said power of attorney; Hence, the legal result will be that the same mortgages registered by virtue of the power of attorney are valid and binding and the bank will be able to act on their behalf for the purpose of realizing the property, and thus repay and realize the property so that the proceeds from the sale can repay the debt of the son
Irrevocable notarial power of attorney Would a claim of misunderstanding have been accepted?
To address the question of whether the mother did understand what she was signing, the notary, Advocate Alberto Schramm, was brought as a witness – even at the first evidentiary hearing at the beginning of the proceedings in this case, in 2005 – who confirmed the mother’s signature and verified it.
To understand the significance of the notarial power of attorney and its implications for the mother’s claim regarding the misunderstanding of the document or her claim that she signed the power of attorney for the purpose of construction and not for the mortgage, I will first address the nature of the notarial power of attorney, and then, discuss the power of attorney This.
The expression of the sender’s desire to appoint the sender is determined according to an objective test, where the determinant is the visible will and not the hidden will, as Prof. Barak explains (ibid., Section 346, pp. 544-545):
The power of attorney form in the file is a power of attorney under section 91 of the Bar Association Law, 1961, which states:
“Approval of power of attorney
A power of attorney granted in Israel to a lawyer to act in the field of actions related to the professional service provided by a lawyer to the client, including receiving funds and other things for his client in such a matter, the client’s signature approved in writing by the lawyer, does not require other approval. .
In practice, although the form is an attorney’s form, in practice, as has been explained more than once throughout this judgment, the proxy is not an attorney – but the son; As stated in the title of the power of attorney, it is not only according to section 91 of the Bar Association Law, but it is also “notary” (in the printed version the title is: “).
Regarding the notarial power of attorney, Prof. Barak notes in his book that one of the examples of that special law that requires a letter to create the mission is: “General power of attorney under the Notaries Law,” and he refers (ibid., Section 354, pp. 552-553), to section 20 (A) of the Notaries Law, 5736-1976 (hereinafter – “the Notaries Law”), which is as follows:
“Power of attorney
A general power of attorney and a power of attorney for the execution of transactions in real estate that require registration in the Real Estate Registry will not be valid unless they have been notarized or verified by the signatures on them, as stated in this law and regulations thereunder; This provision does not derogate from section 91 of the Bureau Law. “
Prof. Barak explains the provision of section 20 (a) of the Notaries Law (brought in the previous paragraph) and section 91 of the Bar Association Law (brought in paragraph 203) and analyzes them (Barak, ibid., Section 354, pp. 553-554). In our case, relevant, one passage, small from his remarks, in which he writes as follows (ibid., At p. 553):
“The reporter’s requirement for a general power of attorney is not explicitly stated. All that is stipulated in the Notaries Law is that the power of attorney must be prepared by a notary. If the power of attorney is not prepared by him, he must verify his signatures. Hence the conclusion that he must be in writing.”
Next, Prof. Barak refers to the provision of the Notaries Law, according to which when it comes to a power of attorney to carry out transactions in real estate, the notary’s approval is required, and explains the connection between this provision and the mission laws and real estate laws, in these words (Barak, ibid., Section 355, p. 554). :
“The Notaries Law stipulates that a power of attorney for transactions in real estate requiring registration in the Land Registry must be made by a notary. If the power of attorney itself is made by a notary, he must verify the signatures on the power of attorney. “Once the question arose, it was ruled that this power of attorney does not concern the authorization to make a transaction in real estate.
This power of attorney, which is signed before a notary, enjoys the strengthening of validity, by virtue of section 19 of the Notaries Law,
However, even if there is no explicit provision in the law, in the wording included in the proposal, the ruling gave great weight to the notarial certificate, and unfortunately, reversed the burden of proof in the sense that whoever seeks to contradict a notarized certificate, the burden of proof.
In other words, the mother, who claims to have signed the notarial power of attorney, without understanding its contents, bears an increased burden of proof, to contradict the presumption that a person knows the contents of a document he signs, in general, and if it is a notarized document, in particular.
Notarized power of attorney Is it incumbent on the Bank to legally review the notarial power of attorney?
The mother claims that the power of attorney was not reviewed by the bank shortly before the registration of the two mortgages.
Oral arguments against a document
Section 80 SIPA of the Ottoman Civil Procedure Act provides as follows:
“Claims relating to all kinds of obligations, agreements, partnerships, contracting or loans, which are customary and customary in documents exceeding one thousand groschen, must be proved in the document. By a document or by the confession or notebook of the claimant. “
This presumption states that in order to contradict agreements, which are customary and customary to make in writing, a contradictory document is required, or alternatively “by the confession or notebook of the defendant”, also applies to this notarized power of attorney, which is naturally customary in the document (see also Judgment of Justice Eliakim Rubinstein in CA 8837/05 Nabil Marshod v. Guad Tawfiq al-Shorti [published in Nevo] (2009)).
In our case, the mother did not meet the conditions required to contradict the language of a power of attorney, which enjoys the presumption in section 80 of the Ottoman Procedure Law.
Irrevocable notarial power of attorney Is the bank related to defects that were, if any, in the notarial power of attorney, which was presumed to be correct?
Beyond what is required, the court states that even if it accepts the mother’s version, according to which it relied on the son, while the son, for its part, deceived and signed it on the said power of attorney, on the pretext that the power of attorney is only for construction on the property, and if I accept the mother’s version. Because the notary was in office, and did not explain to the applicant what she was stamping (a baseless claim that I rejected above outright), even then, it was not to the detriment of the kosherness of the mortgages.
Assuming that the mother, who signed the power of attorney, did so with blind reliance on the son, and without receiving any explanation from the notary, even then, the mother is prevented from raising against the bank the claim that she did not understand what she is signing, thereby shifting her responsibility and negligence. Of the notary (who, as I recall, determined that he was not negligent; the alleged negligence is mentioned here only for the purpose of the legal argument), to the shoulder of the bank (see: Union Bank Case, pp. 171-174; CA 1873/92 Defender Insurance Company Ltd. M. v. Pinchas Haspel (1995), P.D. No. (6) 529; A.A. 6645/00 Arad v. Even (2002), P.D. No. (5) 365, 375-376).
Irrevocable notarial power of attorney operative conclusions
1. I am careful to explain that in fact an irrevocable notarial power of attorney gives the bank infinite powers in the event of non-payment of the mortgage.
2. Of course these powers are exercised by law but it should be clarified that an irrevocable notarial power of attorney is an immensely powerful legal instrument from other legal instruments.
3. It is not for nothing that an irrevocable notarial power of attorney is signed before a notary. If you have any questions ask the notary section by section. Your claim will not be accepted in retrospect that you did not understand.
4. I recommend taking into account that in practice the bank is your full partner in the property until the mortgage is paid and therefore a mortgage is an important tool but also has an element of risk