Commentary to article 163. Representative Office The Civil Code of the Republic of Kazakhstan
Representation is a legal relationship by virtue of which transactions or other legally significant actions (for example, filing a lawsuit or participating in a court hearing) committed by one person, called a representative, on behalf of another person, called represented, directly create, modify or terminate civil rights and obligations for the latter.
As a general rule, subjects of civil law have the opportunity to participate in property turnover independently, without resorting to the mediation of others. Nevertheless, the institution of representation is widely used in civil turnover. The need for representation arises, in particular, when the person being represented cannot personally exercise his rights and duties, for example, by virtue of law, when personal participation is hindered by his lack of legal capacity or specific life circumstances, when personal participation is impossible due to illness, employment, etc. There are a number of cases when representatives are resorted to in order to take advantage of the special knowledge, qualifications or experience of a representative (for example, representation in court, etc.). Representation can significantly enhance the activity of entrepreneurship.
Representation, being a legal relationship, arises on the basis of the following legal facts:
1) a transaction establishing a relationship of representation, for example, the issuance of a power of attorney (see Article 167 of the Civil Code and commentary thereto), the conclusion of a commercial representation agreement (see Article 166 of the Civil Code and commentary thereto), the conclusion of an assignment agreement, the conclusion of an employment contract for employment as a forwarder, seller, cashier, etc.;
2) events with which legislation provides for the establishment of relations of representation, for example, the birth of a child authorizes parents to perform representative functions by legislation (see Articles 23, 164 of the Civil Code and commentary to them);
3) court decisions establishing representation relations, for example, the recognition of a citizen as legally incompetent and the establishment of custody over him by a court decision establishes relations of representation of an incapacitated citizen by his guardian (see Articles 26, 164 of the Civil Code and commentary to them).
4) an administrative act that generates representation relations by virtue of legislation, for example, the appointment of an adoptive parent.
The representative's authority determines the range of transactions or legally significant lawful actions that he has the right to perform for the represented. It is mandatory not only for the representative, but also for other persons with whom he enters into legal relations on behalf of the representative, since representation without authority or exceeding authority cannot produce legal consequences, except in cases of their subsequent approval by the representative (see art. 165 of the Civil Code and commentary thereto). Therefore, the representative's powers should be secured in ways that are possible for third parties to review and verify them.
As a rule, the powers of a representative follow from the content of the legal fact on which the representation is based.
In the case of representation based on the appointment of the head of a branch or representative office, by virtue of Article 43 of the Civil Code, a power of attorney must be issued to the head in order to perform representative functions. In this case, the representative's authority is indicated in the power of attorney.
In case of representation based on an event, a court decision, the powers of the representative follow from the norms stipulated in the legislation, by virtue of which representation arises. For example, if a representative office arises from an event - the birth of a child - the powers of parental representatives follow from the norms of Article 23 of the Civil Code, which provides for the procedure for transactions by minors under the age of 14. When a citizen is declared legally incompetent by a court decision, the powers of the representative follow from Article 26 of the Civil Code, which provides for the procedure for making transactions by an incompetent person.
When a representative office arises from a transaction, the representative's powers are fixed in its terms and conditions. Thus, in the case of an assignment agreement (see Articles 846-854 of the Civil Code) or a commercial representative office (see Articles 166 and commentary thereto), the powers of the representative are indicated in the power of attorney issued to the attorney or commercial representative.
The authority may also be evident from the situation in which the representative is placed by the representative, for example, a salesman behind the counter of a store authorized to make retail transactions, a cashier at the bank's cash desk authorized to accept, issue or make monetary payments. In such cases, the representative's authority does not need to be certified by a power of attorney.
In the case of representation, a relationship arises between the representative, the represented person and a third person with whom the represented person has a legal relationship due to the actions of the representative.
Nevertheless, it is necessary to recognize that representation is a legal relationship between the represented and the representative. The relationship between a representative and a third party is the exercise of the powers of representation and is not independent. By virtue of representation, transactions or other legally significant lawful actions (for example, filing a lawsuit) committed on the basis and within the limits of the powers granted by the representative on behalf of the represented person directly create, modify and terminate civil rights and obligations for the latter. For a third person, the figure of the representative does not matter, since the third person directly enters into legal relations with the represented person through the representative. And under a transaction made by a representative with a third party, the rights and obligations to him arise directly from the represented, but not from the representative.
In order to protect the interests of the represented person, the representative is prohibited from making transactions on behalf of the represented person, for which he is authorized by a power of attorney, in relation to himself personally or in relation to another person, if at the time of making such a transaction he is simultaneously a representative of this person. Otherwise, it would contradict the nature of two or multilateral transactions (see commentary to Art. 148 of the Civil Code), since the mandatory agreement of the will of two or more parties would be replaced by the will of one person - a representative. Therefore, transactions made by a representative in violation of the prohibition established by clause 3 of the commented article are invalid. An exception to this rule is commercial representation, in which it is allowed to represent the interests of different parties to a contract to a person engaged in mediation as a type of entrepreneurial activity (see the commentary to art. 166 of the Civil Code).
Representation involves a representative making transactions on behalf of the represented person. Therefore, any activity of persons carried out in the interests of others, but on their own behalf, is not considered a representation. Therefore, the activities of, for example, trust managers authorized to act on their own behalf, or a commission agent acting on their own behalf, will not be representative.
Activities carried out in the interests of another person, but not generating civil consequences for the latter, will also not be considered representation, for example, the activities of commercial intermediaries who are charged with facilitating the conclusion of transactions rather than making transactions on behalf of another person, or the activities of persons who are charged with entering into negotiations regarding possible future transactions, signing a protocol of intent that is not a civil contract.
There are transactions or other legally significant actions that cannot be performed through a representative, either because of a legal prohibition or because of their personal nature. An example of a transaction that is prohibited from being made through a representative is the drafting of a will. If, for any reason, the testator cannot sign the will in his own hand, then it is signed in the presence of a notary or other person certifying the will by another citizen, the so-called "handyman", indicating the reasons why the testator could not sign the will in his own hand. The handler is not a representative of the testator.
A number of transactions or other legally significant actions, for example, the conclusion of a marriage, an employment contract, a contract for the alienation of a house with the condition of lifelong maintenance, even in the absence of an explicit prohibition in legislative acts, by their nature require personal participation, and therefore their commission through a representative is impossible.
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The commentary was prepared within the framework of the scientific and practical research program of the Scientific Research Center of Private Law of the Kazakh State Law University.
Head of the working group on the preparation of the draft Civil Code of the Republic of Kazakhstan, Corresponding Member of the Academy of Sciences of the Republic of Kazakhstan, Professor Suleimenov M.K.
Deputy head Professor Basin Yu.G.
