Minimum Capacity to Consent or Act: What's the Standard?

September 2006

Professionals must be prepared to deal with the issue of capacity when they attempt to counsel elderly clients and carry out their wishes. The professional should be capable of performing a preliminary assessment of capacity, and know what steps can be taken to maximize a client's independence. A professional should presume that the elderly client has the necessary mental competency to make financial and legal choices.

Legal capacity is a flexible concept. A clinical diagnosis of Alzheimer's disease or another condition that causes dementia suggests diminished capacity, for example, but you should not assume that a person is incompetent to participate in or consent to a particular transaction because of such a diagnosis.

Whether a person has the legal capacity to perform a particular act is examined at the time of the act and must be viewed as task-specific. "Decision-making capacity" requires: possession of a set of values and goals; the ability to communicate and to understand information; and the ability to reason and to deliberate about one's choices. Eccentricity or lack of prudence should not be confused with incapacity.

The professional should use a "functional approach" to observe the client's decision-making process as it relates to the the act to be taken. Six factors that can be applied in using the functional approach are:

  • the client's ability to articulate reasoning behind the decision
  • the variability of the client's state of mind
  • the client's ability to understand the consequences of the decision
  • the irreversibility of the decision
  • the substantive fairness of the transaction
  • consistency of the act or transaction with  the client's lifetime commitments.

To empower the elderly client, the professional should:

  • meet privately with the client
  • create a relaxing and comfortable interview environment
  • talk about topics that interest the client
  • conduct the interview at the client's best time of day
  • encourage questions
  • reassure the client that one purpose of  the meeting is to become acquainted
  • remind the client that the client's decisions will control the outcome of 
    the meeting
  • use indirect questions to assess capacity
  • do not ask intimidating questions that put the client on the spot
  • take verbatim notes.

If you conclude that a client may lack the capacity required to take the desired action, you should talk to the client about enlisting the help of a professional, such as a social worker or family therapist. This will promote the autonomy and safety of the client.

With the aging of America's population and the significant transfer of wealth that will occur in the near future, the professional must acquire a completely different set of skills to deal with the elderly client on a person al level.

Related Practice Areas

Estate and Wealth Preservation Planning

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