Property transactions conducted through a Power of Attorney are among the most common legal arrangements in Pakistan. Every day, thousands of property owners authorize trusted individuals to manage, sell, transfer, or protect their properties on their behalf. This practice is especially common among overseas Pakistanis, elderly property owners, businesspersons, and individuals who live far from their properties.
However, despite the widespread use of Powers of Attorney, many disputes arise because people do not fully understand the legal limits of the authority granted to an attorney.
One of the most frequently asked questions is:
Can a Special Attorney (Mukhtar Khas) transfer the principal’s property to his own brother, wife, son, daughter, or other close relatives?
Understanding the Relationship Between Principal and Attorney
Before discussing whether an attorney can transfer property to his relatives, it is important to understand the legal relationship created by a Power of Attorney.
Whenever a Power of Attorney is executed, two parties are involved:
The Principal
The principal is the actual owner of the property.
The property legally belongs to him.
He grants authority to another person to act on his behalf.
The principal remains the true owner unless ownership is legally transferred through a valid transaction.
The Attorney (Mukhtar Khas)
The attorney is the person authorized to act on behalf of the principal.
He may be authorized to:
- Sell property
- Transfer ownership
- Sign documents
- Appear before revenue authorities
- Collect documents
- Complete registration formalities
However, despite these powers, the attorney remains only an agent.
He does not become the owner.
This distinction forms the foundation of the entire legal discussion.
At first glance, many people assume that if a Power of Attorney authorizes an attorney to sell property, then the attorney may transfer the property to anyone of his choice. However, Pakistani courts have repeatedly emphasized that an attorney is not the owner of the property and cannot use his authority for personal benefit.
This issue has been discussed in various judicial decisions, including 2024 CLC 500, where the court examined the scope of authority exercised by a Special Attorney and highlighted important legal principles arising from Sections 39, 42, and 54 of the Specific Relief Act.
Understanding these principles is essential not only for property owners but also for attorneys, purchasers, revenue officials, and family members who may become involved in property transactions conducted through a Power of Attorney.
This article provides a comprehensive explanation of the legal position, practical risks, judicial principles, and precautions that should be taken before transferring property through a Special Attorney.
Why People Execute Special Powers of Attorney
Many people mistakenly believe that a Power of Attorney is executed only when someone wishes to sell property.
In reality, there are numerous reasons why a person may appoint an attorney.
For example:
Overseas Pakistanis
A person living in the United Kingdom, Saudi Arabia, UAE, Canada, or the United States may own property in Pakistan.
Traveling to Pakistan every time a legal formality arises may be difficult.
Therefore, a trusted person is appointed as an attorney.
Elderly Individuals
Older people may face health issues that make personal appearances difficult.
Business Commitments
Business owners often have demanding schedules and may not be able to attend revenue offices personally.
Residence in Another City
A property owner living in Karachi may own land in Lahore, Multan, Faisalabad, Peshawar, or Quetta.
A local attorney may be appointed to manage legal affairs.
The purpose of a Power of Attorney is therefore convenience and representation—not transfer of ownership.
The Attorney Is Not the Owner
This principle cannot be emphasized enough.
Many legal disputes begin when attorneys start behaving as though the property belongs to them.
Pakistani courts have consistently held that:
An attorney is merely an agent.
The attorney:
✓ Represents the owner.
✓ Acts on behalf of the owner.
✓ Executes documents for the owner.
✓ Performs authorized acts.
But the attorney:
✗ Does not become the owner.
✗ Does not acquire beneficial ownership.
✗ Cannot deal with the property for personal gain.
✗ Cannot use the property as if it were his own asset.
The rights of ownership always remain with the principal unless a lawful transfer takes place.
The Fiduciary Nature of the Relationship
The relationship between the principal and attorney is not an ordinary business relationship.
It is a fiduciary relationship.
A fiduciary relationship is based on trust and confidence.
The law expects the attorney to:
- Act honestly.
- Act loyally.
- Avoid conflicts of interest.
- Protect the owner’s interests.
- Exercise good faith.
The attorney occupies a position of trust and confidence.
Any misuse of that trust may expose him to serious legal consequences.
Why Courts Are Concerned About Transfers to Relatives
The law generally permits an attorney to perform acts authorized by the Power of Attorney.
However, concerns arise when the attorney transfers property to:
- His brother
- His wife
- His husband
- His son
- His daughter
- His parents
- Other close relatives
Why?
Because such transactions create an obvious conflict of interest.
The attorney is supposed to act solely for the benefit of the owner.
When he transfers property to his own family member, questions naturally arise regarding whether the transaction truly benefits the owner or whether it benefits the attorney indirectly.
The Problem of Conflict of Interest
A conflict of interest occurs when personal interests interfere with professional duties.
Consider this example.
A property owner authorizes an attorney to sell a valuable piece of land worth millions of rupees.
Instead of searching for independent buyers in the market, the attorney transfers the property to his own brother.
Immediately several questions arise:
- Was the market value paid?
- Was the owner informed?
- Was the transaction transparent?
- Was the owner given alternative offers?
- Did the attorney receive a hidden benefit?
These questions create legal suspicion.
Courts are naturally cautious when examining such transactions.
Why Such Transactions May Appear Mala Fide
Pakistani courts often examine whether a transaction appears bona fide or mala fide.
A bona fide transaction is one conducted honestly and in good faith.
A mala fide transaction is one undertaken with improper motives.
Suppose an attorney transfers property to his brother.
A few months later:
- The brother transfers the property back to the attorney.
- The brother gives another property to the attorney.
- The attorney continues to possess and control the property.
These circumstances may suggest that the attorney was attempting to indirectly acquire the property for himself.
The transaction may therefore appear self-serving and potentially fraudulent.
Can an Attorney Transfer Property to His Brother?
This is the central question.
The answer is not always a simple yes or no.
The legality depends on several factors, including:
- The wording of the Power of Attorney.
- The owner’s knowledge.
- The owner’s consent.
- The surrounding circumstances.
- Payment of consideration.
- Good faith of the transaction.
However, courts generally require a very high level of transparency when a transfer is made in favor of a close relative of the attorney.
Without such transparency, the transaction may be vulnerable to legal challenge.
What If the Attorney's Brother Genuinely Wants to Purchase the Property?
This is a perfectly legitimate possibility.
There is nothing inherently unlawful about an attorney’s brother wanting to buy property.
However, additional safeguards become necessary.
The safest course of action is:
Inform the Owner Completely
The principal should be told that the purchaser is the attorney’s brother.
Nothing should be concealed.
Obtain Fresh Permission
The owner should expressly authorize the transfer.
Ideally, this permission should be in writing.
Obtain Written Confirmation
The owner should confirm that he understands and approves the transaction.
Ensure Direct Payment to the Owner
The purchase price should be paid directly to the principal whenever possible.
Proof of payment should be preserved.
These precautions help demonstrate good faith and reduce the likelihood of future disputes.
Importance of Sale Consideration
One of the most important aspects of any property transaction is the sale consideration.
The attorney must be able to show:
- How much money was received.
- Who paid the money.
- When payment was made.
- How payment reached the owner.
The sale proceeds belong to the principal.
They do not belong to the attorney.
If an attorney cannot explain what happened to the money, courts may draw adverse conclusions.
What Happens If the Attorney Keeps the Sale Proceeds?
Keeping the owner’s money is a serious matter.
If an attorney receives sale proceeds but fails to deliver them to the principal, several legal remedies may become available.
The principal may seek:
- Recovery of money.
- Cancellation of documents.
- Declaration of rights.
- Damages.
- Injunctions.
- Other legal remedies available under law.
Each case depends upon its facts, evidence, and circumstances.
Rights of the Property Owner
The law strongly protects the rights of the principal.
The owner retains the right to:
- Demand accounts.
- Seek explanations.
- Inspect transaction records.
- Challenge suspicious transfers.
- Revoke authority.
- Initiate legal proceedings where necessary.
The attorney’s powers exist solely because the owner granted them.
The owner’s interests always remain paramount.
Protection for Purchasers
Property buyers should exercise caution when purchasing property through an attorney.
Extra care is required if the purchaser is related to the attorney.
Before purchasing, buyers should verify:
Validity of the Power of Attorney
Ensure the document is genuine and legally valid.
Scope of Authority
Confirm that the attorney has authority to sell.
Owner’s Consent
Seek confirmation from the actual owner whenever possible.
Revenue Records
Review ownership and mutation records carefully.
Payment Documentation
Maintain proper evidence of payment.
A little caution at the beginning can prevent years of litigation later.
Modern Verification Procedures
Today, verification procedures are much more efficient than in the past.
Revenue authorities can verify:
- Ownership records.
- Identity records.
- Property details.
- Mutation entries.
- Transaction history.
Technology has significantly reduced the opportunities for fraud.
However, due diligence remains essential.
Revocation of Power of Attorney
Many people do not realize that a Power of Attorney can be revoked.
If the owner loses confidence in the attorney, he may execute a:
Revocation of Power of Attorney
Once properly revoked:
- The attorney’s authority ends.
- Future acts become unauthorized.
- Purchasers must verify the continuing validity of the authority.
This is why buyers should never rely solely on an old copy of a Power of Attorney.
Practical Advice for Property Owners
Property owners should:
✓ Choose attorneys carefully.
✓ Limit powers where appropriate.
✓ Monitor transactions regularly.
✓ Demand records and updates.
✓ Verify sales personally whenever possible.
✓ Revoke authority if trust is lost.
Practical Advice for Attorneys
Attorneys should remember:
✓ They are trustees of confidence.
✓ They must act honestly.
✓ They must avoid conflicts of interest.
✓ They must maintain records.
✓ They must account for sale proceeds.
✓ They must always prioritize the principal’s interests.
Practical Advice for Purchasers
Purchasers should:
✓ Conduct due diligence.
✓ Verify authority.
✓ Verify ownership.
✓ Confirm consent.
✓ Preserve payment records.
✓ Seek legal advice where necessary.
FAQs
Final Thoughts
A Special Attorney (Mukhtar Khas) is an agent and fiduciary of the property owner, not the owner himself. Although a Power of Attorney may grant authority to sell, transfer, or manage property, that authority must always be exercised for the benefit of the principal.
Transfers in favor of close relatives such as brothers, spouses, children, or other family members are often scrutinized carefully because they create potential conflicts of interest and may raise concerns regarding self-dealing. Such transactions should never be undertaken without complete transparency and the informed consent of the actual owner.
The safest legal course is always to obtain explicit authorization from the principal, ensure that sale proceeds reach the owner, preserve documentary proof, and comply with all legal formalities. By doing so, property owners, attorneys, purchasers, and family members can protect themselves from future disputes and ensure that the transaction withstands legal scrutiny.