Corporate Power of Attorney: Authority Checks

Corporate and Personal Authority

The company grants a company power of attorney, while an individual grants a personal appointment over their own affairs. A director’s personal attorney does not acquire the company’s powers merely because the director signed an enduring appointment.

For example, Service NSW explains personal enduring appointments as continuing during the individual’s lifetime after loss of decision-making capacity. Company authority follows the company’s own approval and execution arrangements. An estate practitioner handling both needs separate files for each grant. See the personal power of attorney safeguards for that distinct appointment.

Identify the capacity in which the person claims to act before analysing their signature.

One person can hold several roles. Record which role they actually used. A signature marked attorney needs its supporting grant even when the signer also works for the company.

Approvals, Execution and Delegated Scope

Check the company’s identity and approval process before treating the signed power as authority for a transaction. Obtain its legal name and Australian Company Number, then match them to the grant and source account records. A similar trading name does not establish that the same legal entity owns the account.

Under section 198D of the Corporations Act, directors can delegate powers unless the constitution provides otherwise. The delegation must be recorded in the minute book. Obtain the constitution, relevant resolutions and directions, including the version operating when authority was granted.

Use the documents to check the following points.

• Identify who approved the appointment and whether the decision followed the company’s applicable meeting or resolution requirements.
• Compare the executed instrument with the approved version, including attached schedules and later amendments.
• Identify the execution method for the grant and for the later transaction. Preserve signature evidence and any electronic signing record.
• Read the permitted transaction types and monetary limits together with commencement, expiry and conditions requiring further approval.
• Check whether attorneys must act together, can act separately or need another named signatory.
• Trace any substitute appointment or onward delegation to its enabling clause, conditions and applicable law. Obtain the actual appointment document.

Section 127 permits company execution without a seal by two directors, or a director and secretary. A sole director of a proprietary company can sign if also sole secretary, or if there is no secretary. Section 126 separately permits an authorised individual to execute for the company. An attorney signing under delegated authority is not automatically using section 127.

The Australian Government Solicitor’s execution guide explains that powers of attorney have different statutory requirements across states and territories. Match the instrument and proposed dealing to the relevant jurisdiction’s execution and registration requirements. A familiar signature block cannot resolve those questions by itself.

An assertion of authority also needs support. Revenue NSW’s corporate power guidance gives an example where an accountant’s purchaser declaration is unacceptable because no evidence establishes authority. Its example concerns that declaration process, but the investigative question is useful elsewhere: which document supports the particular act?

A bank mandate helps establish account access and payment permissions. Read it alongside the company power. Access to an account does not establish permission for every asset transfer, guarantee or recipient.

Matching the Delegation to Financial Transactions

Build a single chronology that connects each approval or authority change with the transaction it might affect. Preserve original documents and native account records. Work from copies and keep document identifiers stable so another practitioner can find the same evidence.

For each transaction, record the account, amount and currency alongside the instruction time and posting time. Add the recipient details and the invoice or other document explaining the payment. Keep the description recorded by the bank separate from your interpretation of the payment.

The following fictional example uses a company power covering supplier payments up to $25,000. Its wording excludes loans and onward delegation.

For the $22,000 transfer, obtain the destination account evidence before accepting the word loan as the final classification. Identify the recipient and any relationship with the attorney. Investigate whether another approval or source of authority explains the transaction.

An apparent scope defect identifies an authority issue. It does not, on its own, prove dishonest intent. Record the mismatch and the missing explanation without converting suspicion into a finding of fraud.

For larger statement bundles, FinTrace saves solicitors and forensic accountants hours of conversion and transaction review. Its service provides a searchable ledger and a findings report that flags suspicious transactions. Every finding identifies its source PDF filename and page, so the transaction evidence is at hand when comparing it with the company documents.

Revocation and Third-Party Reliance

Assess revocation from the instrument, the company’s decision and the law governing that power. Establish when the grant ended or changed, then separately establish what the attorney and each counterparty knew.

Read the termination clause for expiry, completion of a specified task and conditions affecting continuation. Where the instrument claims to be irrevocable, identify the legal basis and any conditions before treating a later notice as effective. A change of director does not itself answer what happens to a company-granted appointment.

Preserve the authorised revocation decision and every notice sent to the attorney, banks or counterparties. Retain delivery receipts, acknowledgements and the bank’s record of changing access. Where registration applies, obtain the relevant registration and revocation records. Continued online access is evidence of an operational gap, not a conclusion that the legal power continued.

Sections 128 and 129 of the Corporations Act protect specified assumptions in company dealings. Section 128(4) excludes an assumption when the person knew or suspected it was incorrect at the time. Apply the relevant assumption to the actual dealing instead of treating an internal defect as conclusive against every outsider.

For a payment after an authority change, distinguish when it was instructed from when it settled. Preserve any pending-payment record and evidence of cancellation attempts. An earlier instruction that posts later needs a different chronology from a fresh instruction after notice.

Finish the review with a transaction schedule identifying the authority relied on, the apparent mismatch and each party’s notice evidence. Give the solicitor the source documents beside unresolved transactions so they can assess authority and third-party reliance on the same factual record.