Elizaveta Pastushenko assessed for Pravo.ru what position the Supreme Court of the Russian Federation may take in a dispute over the lawfulness of entering into a gift agreement on the basis of a general power of attorney
This week the Supreme Court of the Russian Federation will review a dispute in which the defendant has deprived heirs of real estate on the basis of a general power of attorney. The power of attorney was issued while the principal was still alive and was later used by the trustee to enter into a gift agreement. The state registration of the gifted person’s title occurred after the death of the principal. The first instance satisfied the heirs’ claim for invalidation of the transaction, stating that the registration of a gift transaction under a power of attorney, which did not name the giver and did not specify the subject of the gift, was null and void. The appellate and cassation courts noted that the power of attorney was issued for any transactions with all the property owned by the principal, not only for donation. Therefore, it should not have contained information about the planned transaction. On this basis, the claim of the heirs was denied.
The norm of Clause 5 of Article 576 of the Civil Code, which provides for mandatory indication in the power of attorney of the data of the giver and the subject of the gift, is a special one, recalled Elizaveta Pastushenko, Senior Associate of the Private Wealth practice at Maxima Legal. Due to this fact it is impossible to conclude a gift agreement on the basis of a general power of attorney, she emphasised. However, judicial practice on this problem is not uniform at the moment. “It can be assumed that the Supreme Court of the Russian Federation wants to put an end to these disputes by pointing out the necessity to include the information stipulated by law in the power of attorney in all cases and the inadmissibility of any other interpretation,” the Maxima Legal expert suggested.
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