Also known as:personal decision making · personal decisions · autonomy · capacity
Written by attorneys · grounded in primary & secondary sources — see below
A mental capacity enabling a person to understand the nature and consequences of choices that affect personal interests or legal rights. This capacity requires comprehension of relevant facts and the ability to form rational judgments about those facts.
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Cases
Statutes
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Common Law
How it applies
Common Examples
6
M'Naghten Acquittal Claim
Preston Pratt, charged with arson, presents evidence that a diagnosed mental disease prevented him from recognizing that society viewed setting the fire as wrongful. The court applies the M'Naghten test and acquits him because the disease caused a defect in reasoning that eliminated his capacity to know the conduct was wrong.
Party Admission Capacity Issue
Paula Pierce sues her former employer. At deposition she admits under oath that she authorized the disputed transaction while suffering from dementia that prevented understanding its consequences. The court excludes the statement because she lacked personal decision-making capacity at the time.
Corporate Officer Capacity Breach
Parker Phillips, an officer of Phoenix Technologies, approves a risky contract without reviewing financial projections because dementia prevented him from forming rational judgments. Shareholders sue for breach of duty. The court measures his conduct against the standard of care a person in like position would reasonably exercise under similar circumstances.
Diminished-Capacity Client Protection
Paul Peterson's lawyer learns that Paul, suffering from advanced dementia, is about to sell his home for far below market value. The lawyer reasonably believes Paul cannot protect his own interests. The lawyer consults Paul's adult children and petitions for appointment of a conservator.
Effective Consent to Entry
Portia Price signs a release allowing a film crew to enter her property for a documentary. At the time of signing she understands the nature of the filming and its duration. When she later sues for trespass, the court holds the consent effective because it was given by one with capacity to consent.
Irrevocable Gift Capacity
Pavel Petrov, age eighty-two, irrevocably transfers his only substantial asset to a distant relative. He understands the gift will leave him without funds for future medical care. His children challenge the transfer. The court voids the gift because Pavel lacked capacity to appreciate its effect on his financial security.
Common questions
Frequently Asked
5
How does personal decision-making capacity differ from the capacity required to make a will?+
Capacity for an irrevocable gift demands both the mental capacity to make or revoke a will and an understanding of the gift's effect on the donor's future financial security and any dependents. Will capacity focuses on knowing the property, natural objects of bounty, and the disposition being made.
When may a lawyer take protective action for a client with diminished capacity?+
A lawyer may act when the client has diminished capacity, faces substantial risk of harm unless action is taken, and cannot adequately protect personal interests. Permissible steps include consulting family members or seeking appointment of a guardian or conservator.
Does belief that conduct is morally right defeat a M'Naghten defense?+
No. The defendant must also have lost the capacity to recognize that society regards the conduct as wrong. Moral belief alone is insufficient for acquittal under the traditional M'Naghten test.
What standard governs an officer's personal decision-making in corporate matters?+
An officer must act in good faith and with the care that a person in a like position would reasonably exercise under similar circumstances. Failure to meet this standard exposes the officer to liability for resulting harm.
When is consent to conduct ineffective because of lack of capacity?+
Consent is ineffective unless given by one who has the capacity to consent or by a person legally empowered to consent for that individual. Incapacity due to minority, mental impairment, or unconsciousness renders consent invalid.
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for $15,000 in damages. The District Court dismissed the complaint on the ground that the agents were immune from suit. The Court of Appeals affirmed on the alternative ground that no cause…
of industries; to avoid undue restriction of production (except as may be temporarily required); to increase the consumption of industrial and agricultural products by increasing purchasing…
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