Legal Consequences Of Using Power Of Attorney In Nominee Agreements - Flexibility And Legal Limitations

Sep 15, 2026

Uploaded by Noah

Nominee agreements that rely on power of attorney raise complex legal issues in modern practice. Such arrangements involve situations where a party cannot lawfully hold ownership of an asset, commonly in contexts involving foreign participation or Indonesian citizens. They are also used domestically in transactions among legal entities and individuals, often supported by statements and power-of-attorney documents. The research examines the legal consequences, the flexibility created, and the legal limitations arising from these practices.

LanguageEnglish

CategoryLetters

FormatPDF

Pages5

Reading Time2 min

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Abstract

Keywords

Introduction

Legal basis of agreements

Named and unnamed agreements

Position of nominee agreements

Methods

Legal Consequences Of Using Power Of Attorney In Nominee Agreements: Flexibility And Legal Limitations Zahrafhia Najlalinka 1*, Pujiyono2, Tuhana3 1 Master of Notary, Faculty of Law, Sebelas Maret University, Indonesia 2 Professor, Lecturer of Master of Notary, Faculty of Law, Sebelas Maret University, Indonesia 3 Lecturer of Master of Notary, Faculty of Law, Sebelas Maret University, Indonesia *Corresponding Author: [Email:](Email: Zahrafhia@gmail.com)[ ](Email: Zahrafhia@gmail.com)[Zahrafhia@gmail.com](Email: Zahrafhia@gmail.com) Abstract. The practice of nominee agreements involving the use of power of attorney has become an intriguing topic in the context of modern law. Nominee agreements refer to agreements entered into by certain parties, whereby one party cannot be the lawful owner of the ownership rights to an asset, particularly in the context of the participation of foreign nationals or among Indonesian citizens. However, this practice is also commonly employed by Indonesian citizens themselves, both in transactions between legal entities and individuals, as well as among individuals. Many of these practices are accompanied by formal resolutions through statements and power of attorney documents. This research aims to examine the legal consequences arising from such practices, as well as the extent to which they provide flexibility and the associated legal limitations. Keywords : Nominee agreements, Power of attorney, Legal consequence and Flexibility. I. INTRODUCTION In conducting their daily activities, individuals inevitably engage in interactions with others, whether in economic, social, or political spheres. Such interactions can lead to a bond, which reflects the legal relationship between one individual and another, arising from legal events such as actions, occurrences, or specific conditions (Adonara, 2014). Such bonds may arise either due to legal provisions or based on agreements or contracts between individuals.Generally, in society, a legal obligation stems from an agreement made by parties mutually binding themselves in that agreement. Although the terms "agreement"and "obligation" are often used interchangeably, they carry distinct concepts. Obligation is more abstract, referring to the legal relationship concerning property between two or more individuals, while agreement is more specific, referring to a form of consensus that may involve obligations but not necessarily so. In other words, every agreement constitutes a form of obligation, but not all obligations can be considered agreements. An agreement is an event in which one commits to do something for another, or where two individuals promise to undertake a particular action or obligation. As a result, an agreement will give rise to rights and obligations in the context of property law for the parties involved in that agreement.An agreement is an event where an individual commits to performing something for another person, or where two individuals promise to carry out a specific action or obligation for each other (Prodjodikro, 2000) . Legally, the definition of an agreement is explained in the third book of the Indonesian Civil Code (KUH Perdata) concerning obligations. Article 1313 of the Civil Code states that an agreement is an act whereby one or more persons bind themselves to one or more other persons. For an agreement to be considered valid, it must meet the requirements set forth in Article 1320 of the Civil Code. These four requirements include the presence of agreement between the parties involved, legal capacity to enter into an obligation, the existence of a specific subject matter, and the presence of a valid cause. With the fulfillment of these four requirements, the agreement is considered legally binding for all parties involved in its formation.In principle, agreements can be divided into two types, namely named agreements (Nominaat) and unnamed agreements (Innominaat) (Salim 2006) . Named agreements (No

FAQs

What is a nominee agreement in the context discussed?

A nominee agreement is an arrangement where the party acting through another cannot be the lawful owner of asset ownership rights, commonly in land-related contexts involving foreign participation or Indonesian citizens.

Why are nominee agreements classified as unnamed (innominate) agreements?

They are not specifically regulated in the Civil Code and develop through social practice without being fully encompassed by statutory provisions, so they fall under innominate agreements.

What is the research focus regarding power of attorney use?

It examines the legal consequences of using power of attorney within nominee agreements, including how the arrangement offers flexibility and what legal limitations accompany it.

Sep 15, 2026

Uploaded by Noah