Legal capacity can be a difficult concept to understand. For those who are concerned about a loved one’s ability to care for herself or to make financial decisions, the answer to the question of whether their loved one has capacity may seem obvious. Forgetfulness, confusion, and even mild dementia are often viewed as indicative of a lack of or diminished mental capacity. While that may be true, legal capacity involves more than the presence of one or more markers.
The courts have held that legal capacity is fluid. It is decision, time and situation specific. There is no hierarchy of capacity based on the decision to be made. An individual may be incapable of caring for herself regarding health care, nutrition, shelter, clothing and hygiene, yet capable of granting a power of attorney for property. This could be counter-intuitive to some because decisions involving property may seem like the more difficult mental task.
How do the courts determine if someone is or was legally capable? The starting point is to consider the type of decision being made. If the individual wants to, for example, appoint a new attorney for property, the question is whether the individual has the capacity to grant a power of attorney for property on the day the document is executed. The Substitute Decisions Act, 1992, S.O. 1992, c. 30, provides the following legal test for granting a continuing power of attorney for property:
Capacity to give continuing power of attorney
8 (1) A person is capable of giving a continuing power of attorney if he or she,
(a) knows what kind of property he or she has and its approximate value;
(b) is aware of obligations owed to his or her dependants;
(c) knows that the attorney will be able to do on the person’s behalf anything in respect of property that the person could do if capable, except make a will, subject to the conditions and restrictions set out in the power of attorney;
(d) knows that the attorney must account for his or her dealings with the person’s property;
(e) knows that he or she may, if capable, revoke the continuing power of attorney;
(f) appreciates that unless the attorney manages the property prudently its value may decline; and
(g) appreciates the possibility that the attorney could misuse the authority given to him or her.
The legal test is just the beginning of the analysis. How do we answer the questions listed in subsections 8(a) through (g)? Some may believe that the answers lie with their loved one’s doctors or medical team. While the opinions of medical experts may be relevant they are not determinative of the issue of legal capacity. The court has said that “medical-legal capacity is a social construct that requires the trier of fact to take into account factors that go beyond simple medical assessments of capacity.” (Tanti v. Tanti et al., 2020 ONSC 8063, at para 45.)
The opinions of other professionals who have assessed capacity may also be relevant. For example, if a lawyer is involved in the preparation of the power of attorney for property, her opinion of her client’s ability to execute that document will likely be relevant. It will be one of many factors that the court may consider. The court may also consider the evidence of the family members and friends, those who interacted with the individual leading up to, on the day of, and after the decision was made. Contemporaneous evidence is often preferred to retrospective assessments and opinions. In the case of the lawyer, and family members and friends, the court will be alive to the risk of possible self-serving evidence.
The question of whether an individual had or has legal capacity is not an easy one. While it may be tempting to point to one piece of evidence of diminished capacity as conclusive, the answer involves a multi-factored analysis which recognizes the fluidity of legal capacity.