Having mental capacity means having the ability to make a decision to do something that has legal consequences. This is a sensitive issue within the private client sector where many solicitors are having to deal with vulnerable clients on a daily basis. Mental capacity can fluctuate and may be present for one decision but not another, making this an area where solicitors need to act carefully. 

Capacity is ‘decision-specific’ meaning capacity for each decision is assessed independently. A person may have capacity to get married, but not have capacity to enter into a Will or deal with their finances. Difficulties also arise as the tests and levels of capacity vary depending on the decision being made; there is no single test. Until 2007, the test for capacity was based on common law, where every person is presumed to have mental capacity until the contrary is proven. The Mental Capacity Act 2005 (“MCA 2005”) was introduced to codify the common law but not replace it, leading to confusion as to whether the common law test or statutory test should be used. It is a combination of these factors that has led to grey areas in the law.

Over time, capacity tests for each type of decision have been established using different levels of the MCA 2005 and the common law. For example, in the 2014 case of Walker v Badmin the court concluded that the statutory test was more rigid when assessing capacity for entering into a Will as the testator is required to understand all the information relevant to the decision including reasonably foreseeable consequences as opposed to merely ‘appreciating’ the claims to give effect in the Will. In contrast, the capacity test for making gifts leans closer to the common law principles rather than the MCA 2005. Additionally, the case Re Beaney confirmed that the capacity to make a gift will vary depending on the nature, size and circumstances of the gift.

A solicitor has a duty to make a judgement on a client’s capacity. This duty is more onerous when the client is elderly or seriously ill.  A wrong decision can create problems in the future when Wills and gifts are contested, making the solicitor liable for this failure.

Naturally, there are times when it is a clear cut case that someone has or lacks mental capacity, but more often than not, the cases a solicitor sees involve clients or patients where someone’s mental capacity is very uncertain.    It is very easy for an untrained person to make an incorrect judgement about someone’s capacity in these cases and if there is any doubt, a solicitor will need to seek assistance from a qualified medical professional.    An incorrect judgement can have significant consequences – it is just as serious to conclude someone has capacity when they do not, as to conclude that someone has not got capacity, when in fact they do. 

Similarly, if there is any doubt as to capacity, any legal documentation should be witnessed by a qualified medical professional who is satisfied as to the capacity of the client. Keeping a concise record of attendance notes and evidence is also essential and will help prevent future challenges.

Mental capacity by nature is a subjective issue and cannot be contained by one definition or test. Grey areas in this sector are inevitable and solicitors must overcome these problems by carrying out strict and thorough capacity assessments and staying up to date with legal developments to capacity tests.

Helen Freely, Partner

This briefing was posted on 22 September 2017