Organizing the "Power of Attorney Coupled with an Interest" Doctrine: A Review of Judicial Precedent

Introduction
Legal acts that contracting parties create in the world of establishment (jahan-e sobut) are not always fully manifested in the world of proof (jahan-e esbat). The most prominent example of this situation is right-conferring agencies, such as agencies in the capacity of sale. In these cases, after the parties agree on granting or transferring certain rights, such as ownership, they suffice with drafting and granting a power of attorney document. In order to remove ambiguity from this inconsistency, the fundamental question is the nature and structure of the aforementioned agencies and the resulting changes in their effects. Furthermore, if these contracts are considered merely agency in its terminological or legal sense, upon the death or interdiction of the agent or principal, based on Article 678 of the Civil Code, the agency is dissolved; while this contradicts the intention of the contracting parties and the agent's acquired rights. Therefore, to resolve this conflict, the second question is the status of the agency and the right hidden behind 




Organizing the "Power of Attorney Coupled with an Interest" …




it upon the occurrence of the causes of compulsory dissolution of agency.
The innovation of this research is explaining the nature of right-conferring agency within the same framework of the agency contract, but with effects distinct from terminological agency. In such a way that the structure of these agencies is analyzed based on the precedence of internal intention (eradeh-ye batani) and the influence of constructive conversations (goftogu-haye bena'i) to determine the true scope of the contract. In addition, based on the criterion of Article 777 of the Civil Code and the jurisprudential-legal foundations of this article, such as the theory of the sufficiency of the occurrence of permission (hoduth-e ezan), the compulsory causes of dissolution of the agency contract are excluded from the instances of dissolution of right-conferring agencies.
 
Methods
 The present fundamental-applied article collects the necessary information using a library method from legal, jurisprudential sources, and court opinions, and with a descriptive-analytical approach, seeks to answer the aforementioned questions and organize the existing situation.
 
Findings
 Right-conferring agency is a special type of agency contract with unique effects. Understanding its relationship with terminological agencies, as well as its specific characteristics, requires knowledge of the true nature and structure of this contract, centered on the internal intention of the contracting parties. Two analyses exist regarding the nature of right-conferring agency in the world of establishment: First, the power of attorney document that is manifested in the world of proof is only a part of the main and broader contract in the world of establishment; whereas its main effect, that hidden contract whose main pillar is hidden from view, will be the creation of a right. This analysis is based on the theory of conditions (shorut) or constructive provisions (mafad-e bena'i). Just as by considering internal intention as preponderant and effective, constructive agreements prior to the contract, such as agreement on the transfer of ownership, even without specification in the evidentiary document of the contract, enter the realm of the contract. Therefore, the power of attorney document is only a manifestation of a part of the comprehensive and true contract that has been concluded according to the will or common and internal intention of the contracting parties.
The second analysis, consistent with the latter part of Unified Judicial Precedent No. 847, holds that the granting of a right and representation is through two consecutive contracts; such that first, a right-creating contract, such as a sale, is concluded, then, following or based on this created right, an agency is also granted for matters such as receiving the official title deed of ownership. Whereas this same power of attorney document, by signifying the sale in the matter of proof, discloses the prior contract.




Volume 18, Issue 1, Spring 2026
 




Regarding the status of right-conferring agency upon the occurrence of compulsory causes of agency dissolution, such as death and interdiction, a distinction must be made between the right and the agency. The acquired and hidden right in the right-conferring agency, in terms of its position in this legal act, is no different from other acquired rights of individuals, and it remains. However, regarding the agency, it seems that based on the foundation of the said agency on the granted right and the explicit or implicit agreement of the contracting parties, as well as by invoking the criterion of Article 777 of the Civil Code, this category of agencies can be considered remaining even upon the death or interdiction of the contracting parties. Just as a study of the jurisprudential foundations of Article 777 of the Civil Code, as another type of right-conferring agency, shows that in an agency based on the right of pledge (rahaneh), the mere occurrence of permission (hoduth-e ezan) can be considered sufficient. Therefore, the compulsory causes of dissolution set forth in Article 678 of the Civil Code can be considered as pertaining to the customary state of agency, the subject of which is merely the principal's rights.
 
Conclusion
 Right-conferring agency, unlike terminological agency, is not merely the granting of representation. Rather, behind it, a right is created for the agent, and the agency is granted as a part of the legal act creating the right or based upon it. Furthermore, regarding the dissolution or survival of right-conferring agency, it is thought that in addition to the survival of the agent's acquired right in these legal acts, the agency based on that right can also be considered as remaining.