Attwood Marshall Lawyers Legal Practice Director Jeff Garrett speaks to Robyn Hyland on Law Talks on Radio 4CRB about general mental capacity issues and why an Enduring Power of Attorney is so important for everyone to have no matter your age, health, or financial status.
Introduction – what is mental capacity?
To have mental capacity means you have the ability to make decisions for yourself. These decisions can range from general life decisions such as where you choose to live, legal decisions, medical treatment decisions, and day to day to decisions in relation to your overall affairs, including paying bills and general financial management.
While there is a basic common law presumption that every adult has mental capacity to make their own decisions, in some cases solicitors may find they have doubts about whether their client does have the required legal level of mental capacity to make decisions of a legal nature and engage a lawyer.
Someone’s mental capacity may come into question for a range of reasons, including, but not limited to:
- If someone has an intellectual disability or pre-existing genetic condition;
- If someone has an acquired brain injury or has a mental illness or psychiatric condition;
- Someone may have an age-related cognitive disability, such as Alzheimer’s disease or dementia, which impairs their mental capacity to make decisions. This year alone there are an estimated 472,000 Australians living with dementia. Dementia Australia reports than more than two-thirds of aged care residents have moderate to severe cognitive impairment. Without a medical breakthrough, the number of people with dementia is expected to increase to almost 1.1 million over the next 30-40 years, so this issue is becoming increasingly more common and of concern, impacting many Australians and their loved ones.
Determining someone’s level of mental capacity
There are mental capacity tests that are largely driven by what a lawyer is doing for their client.
If a lawyer is seeing a client to take instructions for a Will or an Enduring Power of Attorney, the test in relation to those sorts of documents are quite specific. Whereas, if someone visits a lawyer to discuss other issues like possible court action or they might have a criminal charge against them or they are involved in a dispute, then the test in relation to if they have capacity to give instructions and engage a lawyer for this purpose is a little bit different again.
Tests for different issues and tasks may require a higher standard to be applied, such as if someone wants to do an Enduring Power of Attorney as opposed to giving instructions to do a Will.
Most people may wonder why there is a difference between the two and assume that one rule should apply to all when determining if someone has mental capacity or not, however, documents like an enduring power of attorney do require higher standards because they are giving someone a significant amount of power over your affairs (they effectively step into your shoes legally and can make decisions for you and sign documents). This is a very important decision appointing someone to take over your affairs and therefore the Courts require a higher level of mental capacity and awareness when providing instructions for and signing an Enduring Power of Attorney.
On the flipside, there’s a much lower standard when testing capacity for people who want to get married! When determining capacity in relation to marriage, the Family Law Act 1975 (Cth) states that a marriage is void where:
- The party is mistaken as to the identity of the other party or as to the nature of the ceremony performed; or
- The party was mentally incapable of understanding the nature and effect of the marriage ceremony.
It can be very surprising to know that the legal standard for capacity to consent to marriage is so much lower than the capacity test for other actions or decisions like executing an Enduring Power of Attorney, especially when marriage can impact so many different areas of a person’s life. For example, getting married can render your existing Will and Enduring Powers of Attorney invalid or partially so, depending on which State or Territory you live in.
The different tests that can be used to determine mental capacity for different issues, include:
- Mental capacity to give instructions to a solicitor
- Mental capacity to manage affairs
- Testamentary capacity and writing a Will
- Mental capacity to make a power of attorney
- Mental capacity to consent to medical treatment
- Mental capacity to make health-related privacy decisions
- Mental capacity to consent to marriage
The lawyer’s role in determining if someone has capacity
A lawyer is obliged to presume that someone has the legal capacity to handle their affairs when seeing someone about a legal matter.
It is not the role of a lawyer to be an expert in mental capacity assessment of their client. However, a lawyer can be involved in carrying out a “legal” assessment of their client’s mental capacity which involves making a preliminary assessment, looking for any red flags, and asking some basic questions while observing the client during their consultation.
If a lawyer has doubts about their client’s mental capacity, they can seek an opinion from the client’s treating GP or doctor or a more formal evaluation by a clinician with expertise in cognitive capacity assessment, such as a Geriatrician or Psychiatrist.
This can be a difficult and extremely sensitive issue to approach if a client is displaying certain behaviour or issues but is combative or in denial when questioned about their capacity. Part and parcel of the condition is that they often don’t have awareness of their condition and how it is affecting them.
The loss of capacity is frightening and stigmatising to most people, and many clients will be offended, angry and defensive when this issue is raised. However, it is important for people to understand the legal need for a lawyer to make sure that their client’s mental capacity is adequate for the task at hand. A formal assessment can be seen as a kind of “insurance” to protect against possible future legal challenges to the validity of the legal transaction.
One way to get around this difficult conversation can be to approach the topic with the assistance or in the presence of a family member who can be part of the conversation and potentially play umpire.
A lawyer cannot speak to their client’s doctor without consent. Sometimes it can be difficult to get around the issue and the client does not necessarily understand what is going on and why their lawyer cannot simply do what they are asking them to do.
If capacity is in question, the ultimate decision is not made by the lawyer. If a lawyer is doubtful that someone does not have capacity, in the end it is the decision of the Court (this is usually the Supreme Court in each State or Territory, but can also be QCAT, NCAT, etc).
Whether someone had capacity or not to write a Will often only plays out after the person has passed away and someone challenges the validity of the Will and the fact the Will-maker did not have legal capacity at the time they executed the document.
Capacity red flags
There are some general warning signs or ‘red flags’ a lawyer may see when consulting with their client that may point to the need for further investigation. These can include:
- If a client demonstrates difficulty with recall or has memory loss
- If a client has ongoing difficulty with communications
- If a client is disoriented or suffers from paranoia or delusions
- If there is a sense that “something about the client has changed”, including deterioration in personal presentation, mood, or social withdrawal
- If a client is in hospital or a residential aged care facility when instructions are taken
- If a client has changed solicitors several times over a short period, particularly if there has been a change from a solicitor who has advised the client for many years
- If a client is accompanied by many other friends, family, or carers to interviews with the solicitor but is not given the chance to speak for themselves
- If a client shows a limited ability to interact with the solicitor.
Approaching capacity issues
There are some basic principles a lawyer follows when approaching capacity issues, including:
- First and foremost, as a rule, solicitors always presume a person has mental capacity under common law (sometimes called sanity) to make all their own decisions unless proven otherwise.
- Mental capacity is decision-specific and can be fluid.
- A person’s mental capacity can fluctuate over time or in different situations, so a lawyer will need to assess their client’s mental capacity for each decision whenever there is doubt about mental capacity.
- Even where a client may have lacked the ability to make a specific decision in the past, they might be able to make that decision in the future.
- Clients might also regain, or increase their mental capacity, for example by learning new skills or taking medication.
- Other factors such as stress, grief, depression, reversible medical conditions or hearing or visual impairments may also affect a person’s decision-making mental capacity.
Determining capacity in the COVID era
During the COVID era, many lawyers and businesses alike have increased the amount of phone and video consultations they accept. Consultations by audio-visual methods can make it more difficult to identify capacity red flags.
At Attwood Marshall Lawyers, our lawyers do their best to continue to see people face to face when drafting important legal documents like a Will or Enduring Power of Attorney. This is encouraged not just for the purpose of ensuring someone has the mental capacity to execute these important legal documents, but to build a rapport with our clients and ensure we can accurately understand their what they want and communicate in the most effective way possible.
COVID and the digital age in general has meant we do have to adjust and provide more flexibility to our clients and the way we work. Although the audio-visual options help to have and still provide a way to observe the client during the consultation when connecting via Zoom or similar programs, it’s not the same as a face-to-face consultation. You can miss important subtle nuances and sometimes people affected by capacity issues can present quite well on the surface.
We also must take caution when consulting with clients over the phone to confirm the person the lawyer is speaking to is not someone misrepresenting who they are. We have had cases where people have tried to impersonate their parent or someone else on the phone to have legal documents like a Will drafted or updated. We have the checks in place, but you do need to be very careful of these issues.
The opportunity to have a phone consultation is good to have up your sleeve and we have utilised these tools during COVID outbreaks over the past 18 months. With the introduction of legislation allowing you to witness the signing of certain legal documents via video conference, this has provided more flexibility for those who cannot attend a lawyer’s office, or for people who feel more comfortable completing these tasks by way of audio-visual methods from home or hospital and aged care facilities.
How to protect your best interests in the event your mental capacity becomes an issue
The best strategy to put in place is to have an Enduring Power of Attorney. An Enduring Power of Attorney is a legal document that authorises another person to act on your behalf in managing your affairs if you lose capacity to make decisions for yourself.
This is one of the most important documents you can make in your lifetime as it comes into play whilst you are still alive and ensures someone that you trust can step in to look after you and make important decisions about your personal, financial, or medical matters.
If something happens to you and you have an Enduring Power of Attorney, it means that person can step in immediately and access your bank accounts, pay your bills, help make decisions about medical treatments or your living arrangements that are in your best interest and reflect the decisions you ultimately would have made for yourself.
Without an Enduring Power of Attorney, your loved ones won’t be able to immediately do these things for you. This can make it extremely stressful and difficult for them to be able to help you and carry on your affairs when you need it most.
What to do if you have a loved one who’s mental capacity is declining
If you have a loved one who’s capacity you are concerned about, the only option you have available to you is to apply to a court to have someone appointed on behalf of that person to be their attorney or their guardian.
In Queensland you make your application to the Queensland Civil and Administrative Tribunal (QCAT), and in New South Wales you make your application to the NSW Civil and Administrative Tribunal (NCAT).
Quite often, QCAT won’t appoint people within the family to take on this role. They will very often appoint the Public Trustee to act for those people. The Public Trustee is the state government instrumentality charged to look after people who do not have capacity to look after their own affairs and make their own decisions.
Unfortunately, the Public Trustee has a long history of mismanagement of people’s affairs, and not always doing what is in the best interest of those they are meant to be taking care of. We receive constant enquiries from family members who’s loved ones are currently under the management of the Public Trustee who are desperate to have them removed from managing their affairs.
Aside from the exorbitant fees the Public Trustee charge (which has been documented), it has also been reported that they fail to communicate effectively about how they are handling the affairs of those they manage, they do not cooperate and withhold information, and are not transparent about the fees they charge and the negative effect these have on financial outcomes for people under administration.
Depending on the circumstances, if you are concerned about a loved one’s capacity and they do not have an Enduring Power of Attorney in place, it is best to urgently seek legal advice from lawyers who specialise in this complex area. Most lawyers who do simple Wills or estates do not necessarily specialise in the complex area of mental capacity in succession law.
If the person in question has indeed lost capacity and there is no Enduring Power of Attorney in place, then an experienced lawyer can help with making an application to QCAT or NCAT and guide you through the complex legal process.
Attwood Marshall Lawyers – leading Wills and estates law firm
As important as Wills are, an Enduring Power of Attorney is often overlooked and could perhaps be more important than a Will.
To ensure you have someone that you trust ready to step in and support you when you need it most, it is important to make an Enduring Power of Attorney when you have the capacity to do so.
So many people never consider the need to put a document like this in place and they are extremely underutilized. Only when it is too late and when someone’s capacity diminishes, and family members try to step in and help, do they realise that they are restricted and cannot make decisions on their loved one’s behalf without this document or making an application to the court.
Attwood Marshall Lawyers have one of the largest and most experienced Wills and estates departments in Australia. Our estate planning lawyers can give you trusted legal advice and guide you through the process of executing these documents so that you can have peace of mind in knowing you and your affairs will be taken care of in the event you lose capacity.
Click here to book an appointment online now and have your Will and Enduring Power of Attorney prepared and signed in time for Christmas. Our team are working until Christmas eve and our offices are only closed on the public holidays over the Christmas break.
‘Tis the season to ensure your most basic legal requirements are in order – there is still time to get your Will and EPOA done before Christmas!