What Is a Nominee Agreement?

By Regina Y. Favors - Updated June 07, 2017
Two men shaking hands after agreement

In a nominee agreement, the owner conveys property to a nominee who the latter consents to hold and execute transactions on behalf of the owner. The purpose of the agreement is to outline for legal purposes the ownership of the property and the role of the nominee.

Standard Recitals

For legal purposes, a nominee agreement represents an arrangement in which the owner registers the property in the name of a nominee so that the latter legally holds the property and all the rights related to it such as mortgages, interests, easements, licenses, leases, by-laws and charges. Unlike the owner, the nominee has no beneficial interest in the property.

Authorizations

The nominee cannot make decisions about the property without the express and written authorization of the owner. For many standard agreements, the nominee can only perform, or execute, certain instruments according to the authority outlined in the agreement. This includes performing and/or delivering the following types of documents: leases, deeds, transfers, assignments, contracts and other documents related to the property.

Indemnity

The nominee collects revenues and receipts from the execution of business transactions related to the property on behalf of the owner. The nominee agreement requires the nominee to remit to the owner all financial instruments and the proceeds from transactions conducted through normal business activities. As one condition of the agreement, the nominee incurs no liability and is not responsible for performing contracts between the owner and a third party.

About the Author

I am currently an Adjunct English Instructor (vendor). I teach English, ESL, and writing (composition). My blog focuses on helping students use margin comments as tools for revising their essays. I have published a full textbook version of the glossary and mini glossaries. The book has been approved and adopted by two major universities.

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