THE IRREVOCABLE AGENCY USED FOR SECURING OBLIGATIONS Cover Image
  • Price 3.90 €

MANDATUL IREVOCABIL CA TEHNICĂ DE GARANTARE A OBLIGAȚIILOR
THE IRREVOCABLE AGENCY USED FOR SECURING OBLIGATIONS

Author(s): Radu Rizoiu
Subject(s): Law, Constitution, Jurisprudence
Published by: Universul Juridic
Keywords: obligations; methods of guarantee; irrevocable mandate

Summary/Abstract: The agency was always perceived as a flexible instrument which could be used for achieving a lot of operations. Sometimes, in search of an easy way, the practitioners forget to pay attention to the specificity of the law of agency. For the agency consists essentially in grant a power of representation from the principal to the agent. Securing the performance of obligations did not escape the areas where the agency was used in. The agency could be hardly reconciled with the security level required by the use of a security interest. The main difficulty is derived from the intrinsic revocability of the agency relationship. In order to avoid this obstacle, the legal literature and the case-law tried to create a new breed of agency that is declared irrevocable. Later on, in an attempt to classify the irrevocable agency ex post, the legal scholars discerned the agency coupled with an interest from the agency used as security. Despite these efforts of the legal scholars and case-law, the particularities of the agency opposed to the creation of a truly irrevocable agency. Consequently, the effect of the irrevocability clause was limited to the obligation of the principal to indemnify the agent in case of terminating the agency without cause. However, the power of representation disappears once the agency is revoked by the principal. In addition, the agency gives raise to the multiplication of the legal personality of the principal without decreasing its capacity to perform the deeds mentioned in the scope of the agency. As such, the actions of the agent could be at any time countered by the principal. When the agent wants to ensure that it has the power to do itself the deeds the principal committed to perform under a separate contract, the agency relationship could prove itself an illusory security. A new tool recently adopted by European legislation and included in the New Romanian Civil Code seems to be fit for the job the practice tried to assign to the irrevocable agency. It is the fiducia, a doctrine inspired from the Anglo-American trust. The way this doctrine was regulated in the New Romanian Civil Code is flawed and it runs the risk of making from fiducia a form without substance.

  • Issue Year: 2009
  • Issue No: 04
  • Page Range: 180 - 234
  • Page Count: 55
  • Language: Romanian