Legal Representation BGB & Power of Attorney | IT-Medienrecht

Definition and Function of Representation (Section 164 BGB)

Representation enables a person (the representative) to conclude legal transactions with direct effect for and against another person (the represented party). Pursuant to Section 164 (1) BGB, the legal effect of the declaration directly impacts the represented party, without requiring their personal involvement.

Representation, therefore, fulfills a crucial function in legal transactions. It allows the acting party to structure legal transactions efficiently and flexibly, avoiding the need for each legal transaction holder to act personally.

Requirements for Effective Representation

For effective representation to exist, three basic requirements must be met:

1. Representative's Own Declaration of Intent: The representative must make their own declaration of intent. They cannot merely forward another person's declaration; they are not a mere messenger.
2. Obviousness (Acting on Behalf of Another Person): In accordance with the principle of disclosure (Section 164 (1) sentence 2 BGB), the representative must act clearly and recognizably on behalf of the represented party. This ensures the contractual partner understands with whom the legal transaction is being concluded.
3. Power of Representation: The representative requires a power of representation. This authority can either be provided for by law (e.g., parents for their minor children in accordance with § 1629 BGB) or granted by an explicit power of attorney (§§ 166, 167 BGB).

Granting and Effect of the Power of Attorney (Sections 167 et seq. BGB)

The legal power of representation is typically granted through a power of attorney. According to Section 167 BGB, a power of attorney can be granted either directly to the representative (internal power of attorney) or communicated to a third party (external power of attorney).

Pursuant to Section 171 BGB, an internally granted power of attorney becomes effective vis-à-vis third parties if it is made known to them by presentation or in some other manner. The power of attorney clearly defines the scope and limits of the power of representation, thereby enabling precise and controlled legal transactions.

Representation Without Power of Representation (Sections 177, 179 BGB)

If a representative acts without effective power of representation, the legal transaction is initially considered suspended (Section 177 BGB). The represented party can subsequently validate this legal transaction through express approval.

However, if the represented party refuses approval, the unauthorized representative becomes liable to the contractual partner. This liability can involve either performance or damages, as outlined in Section 179 BGB, unless the contractual partner was aware that the representative lacked authority.

Special Forms of Representation: Apparent and Tolerated Powers of Attorney

Beyond explicitly granted powers of attorney, special forms like apparent (Anscheinsvollmacht) and tolerated (Duldungsvollmacht) powers of attorney hold particular importance. In these scenarios, the represented party can be bound even without having expressly granted authority.

A tolerated power of attorney exists when the represented party knows someone is acting on their behalf without formal authority, but tacitly accepts this behavior. An apparent power of attorney arises if the represented party is unaware of the representative's actions, but could have recognized and prevented them with due diligence. In both cases, the represented party must accept responsibility for the representative's actions, making the legal transaction binding for them.

Representation in Companies: Prokura and Power of Attorney (§§ 48 ff. HGB)

In business life, special forms of representation play a significant role. Authorized signatories (Prokuristen) and authorized agents (Handlungsbevollmächtigte) are typical representatives for companies.

The Prokura (§§ 48 ff. HGB) grants the authorized signatory comprehensive power of representation, which generally cannot be limited in relation to third parties. The commercial power of attorney (Handlungsvollmacht, Section 54 HGB), on the other hand, has a more limited scope and can be restricted to a greater extent. Both instruments enable companies to act flexibly and efficiently.

Practical Significance and Protection Against Abuse

Proxy representation considerably streamlines legal transactions by allowing individuals to have legal dealings conducted by representatives without needing to be personally present. Concurrently, clear rules on the granting and scope of the power of representation are essential.

These rules prevent abuse and ensure legal certainty. The precise requirements for disclosure and power of representation primarily serve to protect contracting parties from unexpected legal consequences.

Fazit

Overall, proxy representation is a key legal institution that significantly contributes to flexibility and efficiency in legal transactions. Its detailed legal structure guarantees both the protection of all involved parties against abuse and a transparent and reliable foundation for legal dealings.