Your personal power of attorney probably will not cut it. The role of a director is a personal office not easily delegated by a director to another.
A Company Power of Attorney (POA) however is a legal instrument that enables a company to authorise a person or another entity to act on its behalf. Unlike an individual power of attorney, which is governed by state-based Powers of Attorney legislation, a company POA is primarily governed by the Corporations Act 2001 (Cth) and the company’s constitution. Its main purpose is to ensure the company can continue to operate efficiently when directors are unavailable or when specialised authority needs to be delegated.
A company may grant a POA to enable an attorney to sign contracts, manage property transactions, handle banking, or undertake other authorised business activities. The scope of authority is defined entirely by the terms of the POA document, which may be broad or limited to a specific task or timeframe. Importantly, the attorney acts on behalf of the company itself, not the directors personally.
Execution requirements differ from those for individuals. A company POA must be properly executed in accordance with section 127 of the Corporations Act, usually by two directors, a director and a company secretary, or a sole director in a single-director company. Once executed, the attorney can sign documents “as attorney for [Company Name]” and the acts of the attorney are legally binding on the company, provided they fall within the granted authority.
Companies typically use POAs for practical reasons, such as facilitating interstate or overseas dealings, managing property settlements, or ensuring business continuity when key officers are unavailable. Revocation is also straightforward: the company may withdraw the authority at any time by issuing a signed notice of revocation and ensuring affected parties are informed.
A well-drafted company POA provides clarity, reduces administrative delays, and helps maintain seamless commercial operations.
If you are a director, particularly of a sole director and sole shareholder company then you should consider a company power of attorney as a vital part of your estate planning. The overall estate and succession plan is only as good as its weakest link.
Speak to one of our lawyers on 08 8344 6422.