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Mandate and Representation – Termination of the mandate and of the authority of the mandatary

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Mandate and Representation – Termination of the mandate and of the authority of the mandatary

Art. 3024. Termination of the mandate and of the mandatary’s authority. In addition to causes of termination of contracts under the Titles governing “Obligations in General” and “Conventional Obligations or Contracts”, both the mandate and the authority of the mandatary terminate upon the:

(1)Death of the principal or of the mandatary.

(2)Interdiction of the mandatary.

(3) Qualification of the curator after the interdiction of the principal.

Art. 3025. Termination by principal. The principal may terminate the mandate and the authority of the mandatary at any time. A mandate in the interest of the principal, and also of the mandatary or of a third party, may be irrevocable, if the parties so agree, for as long as the object of the contract may require.

Art. 3026. Incapacity of the principal. In the absence of contrary agreement, neither the contract nor the authority of the mandatary is terminated by the principal’s incapacity, disability, or other condition that makes an express revocation of the mandate impossible or impractical.

Art. 3027. Reliance on public records. Until filed for recordation, a revocation or modification of a recorded mandate is ineffective as to the persons entitled to rely upon the public records.

Revision Comments – 1997. (c) In Louisiana, the public records doctrine is negative. Parties are entitled to rely on the absence in the public records of documents which according to law must be recorded. The source provision creates the mistaken impression that the public records doctrine has an affirmative function and that a third person may rely on the presence of a recorded mandate. It is implicit in Civil Code Article 3027 (Rev. 1997) that:

(a) the reference is to a mandate which according to law must be recorded in order to have effect toward third persons and

(b) a notice of termination of such a mandate must be placed in the public records. Art. 3028. Rights of third persons without notice of revocation. The principal must notify third persons with whom the mandatary was authorized to contract of the revocation of the mandate or of the mandatary’s authority. If the principal fails to do so, he is bound to perform the obligations that the mandatary has undertaken.

Art. 3029. Termination by the mandatary. The mandate and the authority of the mandatary terminate when the mandatary notifies the principal of his resignation or renunciation of his authority. -when a mandatary has reasonable grounds to believe that the principal lacks capacity, the termination is effective only when the mandatary notifies another mandatary or a designated successor mandatary. In the absence of another mandatary or a designated successor mandatary, the termination is effective when the mandatary notifies a person with a sufficient interest in the welfare of the principal.

Revision Comments – 1997. (b) The mandatary is bound to give notice of termination in accordance with Civil Code article 2024 (Rev. 1984). This provision is applicable even if a mandate is given for a specified period of time.

(c) If the termination of a mandate for remuneration causes injury to the principal, the liability of the mandatary is governed by the Titles of “Obligations in General” and “Conventional Obligations or Contracts.” In the case of a gratuitous mandate, the court may reduce the amount of loss for which the mandatary is liable. See Civil Code Articles 2990 and 3002 (Rev. 1997), supra.

Comment- 2014. The duty of the mandatary to notify someone other than the principal when the mandatary believes the principal lacks capacity does not impose a duty on the person notified to accept any responsibility or take any action. The mandatary remains responsible for the consequences of his failure to fulfill the mandate until proper notice is given.

Art. 3030. Acts of the mandatary after principal’s death. The mandatary is bound to complete an undertaking he had commenced at the time of the principal’s death if delay would cause injury.

Art. 3031. Contracts made after termination of the mandate or the man­datary’s authority. If the mandatary does not know that the mandate or his authority has terminated and enters into a contract with a third person who is in good faith, the contract is enforceable.

Art. 3032. Obligation to account. Upon termination of the mandate, unless this obligation has been expressly dispensed with, the mandatary is bound to account for his performance to the principal.

Mandate and Representation – Relations between principal and third persons

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Mandate and Representation – Relations between principal and third persons

Art. 3020. Obligations of the principal to third persons. The principal is bound to perform the contract that the mandatary, acting within the limits of his authority, makes with a third person.

Revision Comments – 1997. (b) Under this provision a principal, whether disclosed or undisclosed, is bound to perform the contracts that the mandatary, acting within limits of his authority, made with third persons. A third person who contracts with the mandatary has a cause of action directly against the principal, whether disclosed or undisclosed. Cf C.C. art. 3023 (Rev. 1997), infra.

(c) For the liability of a mandatary, who does not disclose his principal or who exceeds his authority, see Civil Code Articles 3018 and 3019 (Rev. 1997), supra. For the liability of a principal who ratifies the acts of the mandatary, see Civil Code articles 3018 and 3019 (Rev. 1997), supra.

(d) This provision applies to all mandates, regardless of the commercial or non-­commercial nature of the mandate or of the contract between the mandatary and the third person.

Art. 3021. Putative mandatary. One who causes a third person to believe that another person is his mandatary is bound to the third person who in good faith contracts with the putative man­datary.

Art. 3022. Disclosed mandate or principal; third person bound. A third person with whom a mandatary contracts in the name of the principal, or in his own name as mandatary, is bound to the principal for the performance of the contract.

Art. 2023. Undisclosed mandate  or principal;  obligations  of third  person. A third person with whom a mandatary contracts without disclosing his status or the identity of the principal is bound to the principal for the performance of the contract unless the obligation is strictly personal or the right non-assignable. The third person may raise all defenses that may be asserted against the mandatary or the principal.

Mandate and Representation – Relations between the mandatary and third persons

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Mandate and Representation – Relations between the mandatary and third persons

Art. 3016. Disclosed mandate and principal. A mandatary who contracts in the name of the principal within the limits of his authority does not bind himself personally for the performance of the contract.

Revision Comments – 1997. (b) This provision applies when the mandatary discloses both his status as a mandatary and the identity of the principal. Thus, when a mandatary enters into a contract with a third person in the name of the principal and within the limits of his authority, the contract binds the principal to the third person and the third person to the principal. In effect obligor and obligee are the principal and the third person. The mandatary does not bind himself personally to the third person for the performance of the contract.

(c) A mandatary who enters into a contract with a third person in the name of the principal and expressly promises the performance of the contract binds himself personally for that performance. See C.C. arts. 1977 and 1983 (Rev. 1984).

Art. 3017. Undisclosed mandate. A mandatary who contracts in his own name without disclosing his status as a mandatary binds himself personally for the performance of the contract.

Art. 3018. Disclosed mandate; undisclosed principal. A mandatary who enters into a contract and discloses his status as a mandatary, though not his principal, binds himself personally for the performance of the contract. The mandatary ceases to be bound when the principal is disclosed.

Revision Comments-1997. Under this Article, a mandatary who discloses the mandate but fails to disclose the principal binds himself personally for the performance of the contracts he has made with third persons. However, the mandatary ceases to be so bound when the principal is disclosed. In such a case, the mandatary incurs the same obligations to third persons as a mandatary who acts in the name of and on behalf of the principal. See Civil Code Article 3016 (Rev. 1997), supra.

Art. 3019. Liability when authority is exceeded. A mandatary who exceeds his authority is personally bound to the third person with whom he contracts, unless that person knew at the time the contract was made that the mandatary had exceeded his authority or unless the principal ratifies the contract.

Mandate and Representation – Obligations of the principal

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Mandate and Representation – Obligations of the principal

Art. 3010. Performance of obligations contracted by the mandatary. The principal is bound to the mandatary to perform the obligations that the man­datary contracted within the limits of his authority. The principal is also bound to the mandatary for obligations contracted by the mandatary after the termination of the mandate if at the time of contracting the mandatary did not know that the mandate had terminated. The principal is not bound to the mandatary to perform the obligations that the mandatary contracted which exceed the limits of the mandatary’s authority unless the principal ratifies those acts.

Art. 3011. Advantageous performance despite divergence from authority The mandatary acts within the limits of his authority even when he fulfills his duties in a manner more advantageous to the principal than was authorized.

Art. 3012. Reimbursement of expenses and remuneration. The principal is bound to reimburse the mandatary for the expenses and charges he has incurred and to pay him the remuneration to which he is entitled. The principal is bound to reimburse and pay the mandatary even though without the mandatary’s fault the purpose of the mandate was not accomplished.

Art. 3013. Compensation for loss sustained by the mandatary. The principal is bound to compensate the mandatary for loss the mandatary sustains as a result of the mandate, but not for loss caused by the fault of the mandatary.

Art. 3014. Interest on sums expended by the mandatary. The principal owes interest from the date of the expenditure on  sums expended by the mandatary in performance of the mandate.

Art. 3015 Liability of several principals. Multiple principals for an affair common to them are solidarily bound to their mandatary.

Mandate and Representation – Duties of the mandatary

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Mandate and Representation – Duties of the mandatary

Art. 3001. Mandatary’s duty of performance; standard of care. The mandatary is bound to fulfill with prudence and diligence the mandate he has accepted. He is responsible to the principal for the loss that the principal sustains as a result of the mandatary’s failure to perform.

Art. 3002. Gratuitous mandate; liability of a mandatary. When the mandate is gratuitous, the court may reduce the amount of loss for which the mandatary is liable.

Art. 3003. Obligation to provide information. At the request of the principal, or when the circumstances so require, the manda­tary is bound to provide information and render an account of his performance of the mandate. The mandatary is bound to notify the principal, without delay, of the fulfillment of the mandate.

Art. 3004. Obligation to deliver; right of retention. The mandatary is bound to deliver to the principal everything he received by virtue of the mandate, including things he received unduly. The mandatary may retain in his possession sufficient property of the principal to pay the mandatary’s expenses and remuneration.

Art. 3005. Interest on money used by mandatary. The mandatary owes interest, from the date used, on sums of money of the principal that the mandatary applies to his own use.

Art. 3006. Fulfillment of the mandate by the mandatary. In the absence of contrary agreement, the mandatary is bound to fulfill the mandate himself. Nevertheless, if the interests of the principal so require, when unforeseen circumstances prevent the mandatary from performing his duties and he is unable to communicate with the principal, the mandatary may appoint a substitute.

Art. 3007. Mandatary’s liability for acts of the substitute. When the mandatary is authorized to appoint a substitute, he is answerable to the principal for the acts of the substitute only if he fails to exercise diligence in selecting the substitute or in giving instructions. When not authorized to appoint a substitute, the mandatary is answerable to the principal for the acts of the substitute as if the mandatary had performed the mandate himself. In all cases, the principal has recourse against the substitute.

Art. 3008. Liability for acts beyond authority; ratification. If the mandatary exceeds his authority, he is answerable to the principal for resulting loss that the principal sustains. The principal is not answerable to the mandatary for loss that the mandatary sustain because of acts that exceed his authority unless the principal ratifies those acts.

Art. 3009. Liability of multiple mandataries. Multiple mandataries are not solidarily liable to their common principal, unless the mandate provides otherwise.

Mandate and Representation – Special situations

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Mandate and Representation – Special situations

Art. 2998. Contracting with one’s self. A mandatary who represents the principal as the other contracting party may not contract with himself unless he is authorized by the principal, or, in making such contract, he is merely fulfilling a duty to the principal.

Art. 2999. Person of limited capacity. A person of limited capacity may act as a mandatary for matters for which he is capable of contracting. In such a case, the rights of the principal against the mandatary are subject to the rules governing the obligations of persons of limited capacity.

Art. 3000. Mandatary of both parties. A person may be the mandatary of two or more parties, such as a buyer and a seller, for the purpose of transacting one or more affairs involving all of them. In such a case, the mandatary must disclose to each party that he also represents the other.

Mandate and Representation – Express authority required

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Mandate and Representation – Express authority required

Art. 2996. Authority to alienate, acquire, encumber, or lease. The authority to alienate, acquire, encumber, or lease a thing must be given expressly. Neither the property nor its location need be specifically described.

Art. 2997. Express authority required. Authority also must be given expressly to:

(1) Make an inter vivos donation, either outright or to a new or existing trust or other custodial arrangement, and, when also expressly so provided, to impose such conditions on the donation, including, without limitation, the power to revoke, that are not contrary to the other express terms of the mandate.

(2) Accept or renounce a succession.

(3) Contract a loan, acknowledge or make remission of a debt, or become a surety.

(4) Draw or endorse promissory notes and negotiable instruments.

(5) Enter into a compromise or refer a matter to arbitration.

(6) Make health care decisions, such as surgery, medical expenses, nursing home residency, and medication.

(7) Prevent or limit reasonable communication, visitation, or interaction between the principal and a relative by blood, adoption, or affinity within the third degree, or another individual who has a relationship based on or productive of strong affection.

Mandate and Representation – Mandatory may not execute testament for testator

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Mandate and Representation – Mandatory may not execute testament for testator

Art. 1571. Testaments with others or by others prohibited. A testament may not be executed by a mandatary for the testator. Nor may more than one person execute a testament in the same instrument.

Mandate and Representation – General authority by mandate

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Mandate and Representation – General authority by mandate

Art. 2994. General authority. The principal may confer on the mandatary general authority to do whatever is appropriate under the circumstances.

Art. 2995. Incidental, necessary, or professional acts. The mandatary may perform all acts that are incidental to or necessary for the performance of the mandate. The authority granted to a mandatary to perform an act that is an ordinary part of his profession or calling, or an act that follows from the nature of his profession or calling, need not be specified. A mandatary shall not prevent or limit reasonable communication, ;visitation, or interaction between a principal who is over the age of eighteen years and another person without prior court approval, to be granted only upon a showing of good cause by the mandatary, unless express authority has been provided pursuant to Civil Code Article 2997(7).

Mandate and Representation – General principles

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Mandate and Representation – General principles

Art. 2989. Mandate defined. A mandate is a contract by which a person, the principal, confers authority on another person, the mandatary, to transact one or more affairs for the principal.

Revision Comments-1997. Under this article, a principal may confer authority on a mandatary to act either in his own name or in the name of the principal. The principal may, therefore, be either disclosed or undisclosed. For the rights and obligations of a disclosed principal and of an undisclosed principal, see C.C. arts. 3016, et seq., According to traditional civilian notions, an “affair” may be either a juridical act or a material act. Louisiana decisions may be found in which a mandatary was charged with the responsibility for certain material acts, such as collection of debts, making repair estimates, receiving payments, etc. When no special provisions are made under the Code articles on mandate, the contract of mandate is governed by the provisions for contracts.

Art. 2990. Applicability of the rules governing obligations. In all matters for which no special provision is made in this Title, the contract of mandate is governed by the Titles of “Obligations in General” and “Conventional Obligations or Contracts”.

Art. 2991. Interest served. The contract of mandate may serve the exclusive or the common interest of the principal, the mandatary, or a third person.

Art. 2992. Onerous or gratuitous contract. The contract of mandate may be either onerous or gratuitous. It is gratuitous in the absence of contrary agreement. As with procurations, the mandate is not subject to any particular requirement of form. However, when the law prescribes a certain form for an act, the mandate authorizing the act must be in that form. For example, an act of donation or acceptance of donation must be in authentic form, therefore for a mandatary to execute an act of donation or accept a donation on behalf of the principal, the mandate must be an authentic act. Similarly, a suretyship must be in writing, so a mandatary may not bind his principal as a surety unless the mandate is in writing.

Art. 2993. Form. The contract of mandate is not required to be in any particular form. Nevertheless, when the law prescribes a certain form for an act, a mandate authorizing the act must be in that form.