Short answer. Ordinarily yes — the Civil Code lists the death of the principal among the events that extinguish an agency. But there is a real exception: the agency survives where it was constituted in the common interest of principal and agent, or in the interest of a third person who accepted it.

What the law says

The agency shall remain in full force and effect even after the death of the principal, if it has been constituted in the common interest of the latter and of the agent, or in the interest of a third person who has accepted the stipulation in his favor.

Civil Code, Article 1930 — Agency Surviving the Principal's Death. Read the full provision →

The default rule, and why it exists

Agency rests on the principal's continuing will that someone act for him. When he dies that will can no longer be exercised, and the Civil Code's list of the ways an agency is extinguished accordingly includes the death of the principal or of the agent. The consequence is blunt: a special power of attorney signed by a parent stops empowering the child named in it the moment the parent dies. Property cannot be sold under it, accounts cannot be dealt with under it, and the document does not become an inheritance instrument merely because it is still in someone's hands.

The exception in Article 1930

Against that background, Article 1930 provides that the agency shall remain in full force and effect even after the death of the principal, if it has been constituted in the common interest of the latter and of the agent, or in the interest of a third person who has accepted the stipulation in his favor. The reasoning is that such an agency was never purely a favour to the principal. Somebody else's interest is bound up in it, and letting death cancel it would take away a right that person already holds. Note the acceptance requirement in the second limb: a stipulation in a third person's favour has to have been accepted by him.

Why heirs and counterparties should care

The exception matters most where the authority is attached to something else — a loan, a security arrangement, a sale already agreed, a management arrangement forming part of a wider contract. Those are the authorities that are likely to have been created in a shared interest rather than as a convenience. For heirs, this means an agent who keeps acting after the death is not automatically acting without power, and the answer requires reading why the authority was given. For anyone about to deal with an agent, it means the question is not only whether a power of attorney exists but whether the principal is alive.

What to do when a principal dies

If you are the agent, stop and take advice before acting again, and say nothing to a counterparty that implies your authority is unaffected. If you are an heir, notify in writing every bank, registry and counterparty that holds a copy of the authority, and ask the agent for an accounting of what was done and what remains in his hands. Keep the original instrument, the death certificate and the contract the authority relates to together — that combination is what a lawyer needs to say whether Article 1930 applies, and it usually cannot be answered from the power of attorney alone.

Cases citing this provision

These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.

Related provisions

Note. Statute text quoted on this page is reproduced from the official enactment and is linked to the full provision. The explanation around it is general legal information from Vivas & Nobles Law Office, not legal advice. Whether it applies to your situation depends on facts only a lawyer reviewing them can assess.