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Mental Capacity is a term often used in the context of property sales, will drafting, and healthcare – but what does this mean?
Mental capacity refers to whether someone has the cognitive ability to understand, retain, and evaluate information in order to make a particular decision.
There are specific tests buried in case law regarding capacity to enter into certain deeds and transactions, for example, the test for mental capacity to prepare a will is found in the centuries old case of Banks v Goodfellow. However, broadly speaking, an individual must have the requisite mental capacity in order to make decisions regarding their property and financial affairs, and their personal welfare.
There are many circumstances in which people may lack mental capacity, with common examples including people living with advanced dementia, or severe learning difficulties. It is important to note that, under the Mental Capacity Act 2005, adults in the UK are presumed to have mental capacity unless proven otherwise. In addition, mental capacity can fluctuate, and people living with cognitive impairments often still have the capacity to deal with certain elements of their affairs.
Where an individual lacks the mental capacity to make decisions regarding their affairs, it is crucial that their interests and rights are protected, and there are a number of safeguarding bodies in place to ensure that this is the case, including:-
The Court of Protection, which is a specialist Court who consider all matters regarding the financial and personal welfare of people who lack the mental capacity to make such decisions themselves; and
The Office of the Public Guardian, which is a government agency who have responsibility for protecting and monitoring the interests of individuals who lack capacity.
Many people prepare Lasting Powers of Attorney to ensure that, in the event they become unable to make decisions themselves, their trusted family members, friends, or advisors can make such decisions for them.
However, in the circumstances where someone loses capacity and does not have a Lasting Power of Attorney in place, or where someone lacks the capacity to make decisions regarding their affairs from a young age, it may be appropriate to make an application to the Court of Protection. The Court of Protection can grant deputyships (where a deputy is appointed to manage an individual’s property and financial affairs or personal welfare on an ongoing basis), or the Court can grant permission for specific actions.
If you have concerns regarding the property and financial affairs or personal welfare of someone you know, please do contact a member of our specialist Court of Protection team who are more than happy to assist.
Have a different question?
Get in touchUnder the Mental Capacity Act 2005, an adult is always presumed to have mental capacity unless a proper assessment proves otherwise. Mental capacity is decision-specific and time-specific, meaning a person may have the capacity to make day-to-day choices but lack the ability to handle complex financial transactions or major medical decisions. Capacity is assessed by evaluating whether the individual can understand the relevant information, retain it long enough to decide, weigh up the options, and communicate their final decision. If a person cannot complete any one of these steps due to an impairment or disturbance in the mind or brain, they are deemed to lack capacity for that specific decision.
If an individual loses mental capacity and has not previously executed a valid Lasting Power of Attorney (LPA), no one – including spouses or adult children – has the automatic legal authority to manage their affairs. Family members cannot access bank accounts, pay bills, sell property, or make formal care decisions on their behalf. In these circumstances, an application must be made to the Court of Protection to appoint a Deputy. The appointed Deputy receives formal judicial authority to handle the individual’s financial affairs or welfare decisions, subject to ongoing supervision by the Office of the Public Guardian.
Our specialist solicitors provide expert support across all areas of mental capacity law, including guidance on obtaining formal capacity reports from medical professionals. We assist families with non-contentious Court of Protection applications and provide representation in complex or disputed cases. This includes challenging contested deputyship applications, resolving disagreements over best-interest decisions, or objecting to the registration or operation of an LPA where financial abuse or undue influence is suspected. Where required, we can also apply for specific court orders, such as Statutory Wills or gift approvals.
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