Foreign Power of Attorney Not Presumed Valid Without Proof of Reciprocity, Rules Kerala High Court

Ernakulam, Kerala - In a significant ruling clarifying the evidentiary value of documents executed abroad, the Kerala High Court has held that the legal presumption for a Power of Attorney (PoA) under Section 85 of the Evidence Act cannot be invoked unless the document is executed in a "reciprocating country" as defined under Section 14 of the Notaries Act, 1952.

Justice K. Babu, while hearing an Original Petition, set aside a trial court's order that had accepted a PoA executed in the USA without insisting on proof of reciprocity between the two nations for notarial acts.

Case Background

The matter arose from a civil suit where the plaintiff, represented by a Power of Attorney holder, sought the execution of a release deed. The PoA in question (Ext.P1) was executed and authenticated by a Notary Public in St. Louis County, Missouri, USA.

The defendant (petitioner in the High Court) challenged the validity of the PoA and sought the rejection of the plaint, arguing that the suit was not properly instituted. The trial court rejected this application, leading the defendant to approach the High Court.

Key Arguments

The petitioner, represented by Senior Counsel Sri. S.V. Balakrishna Iyer, raised several contentions, but primarily focused on one critical legal question:

Petitioner's Argument: For an Indian court to recognize a notarial act from a foreign country and apply the presumption of due execution under Section 85 of the Evidence Act, that country must be a "reciprocating country." This requires a notification by the Central Government under Section 14 of the Notaries Act, declaring that notarial acts from that country are recognized in India. As there was no evidence that the State of Missouri was a reciprocating territory, the PoA lacked legal sanctity.

Respondent's Argument: The plaintiff's counsel contended that the presumption under Section 85 of the Evidence Act is independent and can be drawn without reference to Section 14 of the Notaries Act. They argued that withholding this presumption would create serious difficulties and hinder international trade and commerce.

Court's Analysis and Precedents

Justice K. Babu conducted a detailed analysis of the interplay between the Evidence Act and the Notaries Act. The court observed that Section 14 of the Notaries Act, 1952, provides a specific mechanism for the recognition of notarial acts performed by foreign notaries based on reciprocity.

The judgment emphasized that these two provisions cannot be read in isolation. The Court noted:

"The mandate of Section 14 of the Notaries Act is that unless the foreign country where a power of attorney is executed before a notary public is a reciprocating country by way of recognition under Section 14 of the Notaries Act, the notarial act done in the foreign country lacks sanctity."

The High Court concurred with the reasoning of the Calcutta High Court in Rei Agro Ltd. , which held that Section 85 of the Evidence Act is subject to the conditions laid out in Section 14 of the Notaries Act for foreign notarial acts. The Court respectfully disagreed with an older view of the Allahabad High Court in Abdul Jabbar , which suggested the presumption could be applied independently.

Elaborating on the judicial notice of a notary's seal under Section 57(6) of the Evidence Act, the Court held:

"In the absence of proof of reciprocation of the foreign country where the power of attorney was executed before the notary public the presumption regarding identification and authentication as provided in Section 85 of the Evidence Act would not arise."

Final Decision and Implications

The High Court concluded that the trial court had erred in accepting the Power of Attorney without insisting on proof of reciprocity from the State of Missouri, USA.

However, the Court clarified that this defect was not a ground to reject the plaint entirely. Instead, it set aside the trial court's order to the extent that it accepted the defective PoA.

Granting a chance to the plaintiff to rectify the procedural defect, the Court gave them the liberty to produce a duly executed Power of Attorney and proceed with the suit. This decision underscores the critical importance for litigants to ensure that any Power of Attorney executed abroad complies with the reciprocity requirements under Indian law to be legally valid in court proceedings.