[BIP:73] Power of Attorney

TLDR: Beefy should grant core contributors a limited power of attorney to represent Beefy DAO with respect to the execution of formal agreements and handling of confidential information.

Background

From time to time, Beefy’s operations - like those of all other growing organizations - must engage in some formal interaction with other organizations and businesses, including the execution of formal agreements and the handling of confidential information. These interactions are often vital for Beefy’s survival or important for its success, and so warrant accepting more formal approaches and arrangements than are typically seen in DeFi and DAOs.

Up to now, Beefy’s core contributors have generally done what needs to be done on an ad hoc basis to handle formal arrangements, including in some instances providing real names or other KYC information, or making payments out of personal accounts tied to their personal identity. Naturally, this presents some personal risk for individual contributors, and is a barrier to engaging formally with any but the most important and critical of formal arrangements.

This proposal suggests how Beefy may develop its processes for engaging with formal arrangements, both to address concerns with the existing ad hoc approach and to provide core contributors with further assurances with respect to their role in executing formal agreements.

Power of Attorney

In traditional legal parlance, the appropriate instrument for authorizing other individuals and entities to act on your behalf is a “power of attorney”. This is typically a written document which confers specific powers from the principal (i.e. Beefy) to its attorney/agent (i.e. core contributors).

A written Power of Attorney document is typically signed by both the principal and the attorney, to reflect the agreed authorization (and its limitations). The executed document is often used by the attorney when acting on the principal’s behalf to satisfy counterparties of its authority to act.

In the case of a DAO like Beefy’s - which is currently unincorporated and has no current formally-authorized signers - it may be seen as paradoxical for anyone to execute a Power of Attorney in the DAO’s name. Instead, it is felt that formal DAO approval through a binding governance proposal is the best method to provide a binding Power of Attorney on behalf of the DAO. As such, this proposal - if approved - aims to confer the authorization of a Power of Attorney using the proposal itself as the formal written instrument.

Scope of Authorization

Specifically, the scope of authorization proposed in this Power of Attorney is to authorize each Beefy core contributor to engage in and carry out the following powers for the duration of their appointment as core contributors:

1. To sign and execute formal agreements and documents on behalf of Beefy DAO where it receives approval either (i) where put to a DAO governance proposal, from a plurality of voters; or (ii) where not put to DAO governance, through internal agreement of the core contributor team;

2. To receive, consider and manage the handling of confidential information on behalf of Beefy DAO, which will not be disclosed publicly or generally among members of the DAO, subject always to the ongoing internal agreement of the core contributor team; and

3. To draft and negotiate formal agreements and documents on behalf of Beefy DAO, subject always to the ongoing internal agreement of the core contributor team.

References to internal agreement or approval of the core contributor team should be understood to mean that - where there is not clear agreement or general approval among the core contributor team for a given core contributor to use the powers conferred above - the relevant core contributor should not use their powers unless and until agreement among the core team is reached. Nothing in this proposal should be read as giving any contributor rights to unilaterally make decisions or commitments on behalf of the DAO.

This proposal anticipates that details of use by core contributors of the powers conferred should generally be shared publicly with the DAO by default, from the time when this proposal is approved onwards. Where confidentiality means that either the existence of a formal arrangement or its specific details cannot be shared more broadly, it is expected that core contributors will share details only insofar as they are able, and will not be required to share details in a manner which they feel may put them in breach of any confidentiality obligations.

It is also noted that this Proposal does not envisage that any core contributor should have to make any specific use any of the powers conferred. In particular, where any contributors do not want to engage with formal arrangements or disclose their own personal information on behalf of the DAO, there is no obligation to do so and the Beefy DAO is not empowered to require this from any core contributor.

Likewise, all core contributors exercising powers conferred in this Power of Attorney do so in their capacity as independent contractors and agents of the DAO. Nothing in this Power of Attorney is intended to reflect any formal employment relationship with, or directorship of, the Beefy DAO.

Protection for Contributors

A typical Power of Attorney also includes protections for the attorney/agent, to ensure that - by acting on the principal’s behalf - they do not inherit or in practice suffer any liabilities which are rightfully attributable to the principal. Shielding contributors from personal liability is important to ensure they feel comfortable to act, and comfortable that by acting they will not expose themselves to any unacceptable personal risks.

By approving this proposal, it is intended that any Power of Attorney conferred by it will be subject always to the following obligations and actions of Beefy DAO:

1. Beefy DAO shall indemnify any core contributor in respect of liability incurred personally by that contributor through any formal agreement or arrangements rightfully and properly executed or otherwise engaged with by that contributor using the powers conferred by this Power of Attorney, which should rightfully have been attributable to Beefy DAO instead;

2. All core contributors shall be free from any obligations, and Beefy DAO shall waive all rights and obligations in relation to that contributor as its attorney, specifically in respect of providing accurate, correct and/or complete information as part of any exercise of their powers with respect to formal arrangements, to the extent that such information is provided generally by the core contributor team or Beefy DAO, and not solely by that contributor; and

3. Beefy DAO shall reimburse any core contributors for reasonable out of pocket expenses incurred by them in connection with the exercise of the conferred powers, to be taken out of the core team’s discretionary budget (or subject otherwise to formal DAO approval).

For the avoidance of doubt, the above indemnity is subject always to Beefy DAO having the right to direct and manage any proceedings relating to potential liabilities which are or ought to have been attributable to Beefy DAO instead. No core contributor should manage such proceedings without the general agreement of the rest of the core contributor team.

Likewise, the above obligations and actions are subject at all times to each contributor acting properly and with the necessary approval in accordance with the scope of this authorization. Where any contributor acts beyond the scope of their conferred authority or in violation of the requirements set out in this proposal, these obligations and actions shall not apply and the contributor shall be treated as having waived any corresponding rights.

This proposal envisages that any core contributor may resign or have their appointment terminated at any time upon reasonable notice. Upon termination, the relevant contributor shall automatically surrender and lose all ongoing powers conferred by this Power of Attorney. For the avoidance of doubt, termination of a core contributor’s role shall not alter the position with respect to their personal liability for agreements entered into during the period of their previous appointment as a core contributor.

Where new core contributors join the team over time, it is expected that this existing power of attorney should extend naturally to include them for the duration of their role.

The authorization contemplated by the Power of Attorney in this proposal does not extend to permit core contributors to grant further powers of attorney (or other authorisations) to others, either generally or with respect to the specific powers conferred herein.

Proposal

Beefy should grant each member of its core contributor team a limited power of attorney for the duration of their appointment on the core team specifically conferring the powers detailed in this proposal (subject always to its terms).