Topic:
MENTAL HEALTH; ATTORNEYS; CONTRACTS;
Location:
ATTORNEYS; MENTAL HEALTH;

OLR Research Report


February 11, 2002

 

2002-R-0094

POWER OF ATTORNEY-MENTAL CAPACITY

By: George Coppolo, Chief Attorney

You asked about the mental capacity requirements for someone who wishes to execute a power of attorney.

SUMMARY

The General Statutes do not establish any standard or requirement regarding the mental capacity of someone who wishes to create a power of attorney. We found one officially reported Connecticut case that addresses this precise issue. The Appellate Division of the Connecticut Circuit Court held that someone who is not in a mental condition to contract and conduct his business is not in a condition to appoint an agent for that purpose (Beaucar v. Bristol Federal Sav. & Loan Ass. 6 Conn. Cir. Ct. 148 (1969)).

 

Unfortunately, the court did not specify what precise factors a court must consider when determining whether someone has the appropriate mental capacity to contract. But the standard test for determining mental capacity to enter into a contract is whether someone understands in a reasonable manner the nature of the transaction and its consequences and effect upon his rights and interests (17A Am. Jur. 2d, Contracts and 156).

Whether someone is found competent to execute a contract is largely dependent on the facts and circumstances of each case. Courts generally consider almost any evidence, including lay opinions, expert opinions, and any prior and subsequent adjudications of incompetence. Courts take into consideration the person's physical condition, whether the transaction was imprudent, the trust and confidence between the parties to the transaction, and the weakness of mind of the alleged incompetent person as judged by all other acts within a reasonable time before and after the act in question (53A Am. Jur. 2d Mentally Impaired Persons, 157 and 158).

One possible caveat should be kept in mind. Because Beaucar is not a Supreme or Appellate Court decision, it is not binding on the Superior Court. (As you know, the Circuit Court was abolished many years ago.) Thus, when confronted with this question, judges could require some other mental capacity. For example, some legal commentators recommend that the required mental capacity for executing a power of attorney be less than that required to enter into a contract (See Restatement of the Law Second, Agency 2d 20, Capacity).

However, we spoke with Linda Dow, Counsel to the Probate Court Administrator, Tom Gaffey, Deputy Probate Court Administrator, and attorney Susan Nobleman, chairperson of the Connecticut Bar Association's Elder Law Section. All three indicated that they believe that the Beaucar ruling continues to control in Connecticut and that judges are likely to follow it.

The General Statutes do appear to establish a statutory standard for the mental capacity required to execute a document naming a health care agent. (The law authorizes a health care agent to convey the principal's wishes concerning the withdrawal or removal of life-support systems and to consent to medical treatment designed solely to maintain physical comfort.) The law requires that the person executing such a document be of sound mind and be able to understand the nature and consequences of these health care decisions at the time he signs it (CGS 19a-575a and 19a –577).

POWER OF ATTORNEY

A power of attorney is a written document by which someone, as principal, appoints another as his agent and authorizes him to perform certain specified acts or kinds of acts on his behalf. The written authorization itself is the power of attorney. The person giving the power is known as the principal, and the person holding the power of attorney is known and designated as an “attorney in fact” as distinguished from an attorney at law. The attorney in fact is essentially the alter ego of the principal and is authorized to act on his behalf.

TERMINATION OF POWER OF ATTORNEY AND DURABLE POWER OF ATTORNEY

Except as noted below, a power of attorney, just as with any other agency, terminates when the principal becomes incompetent (3 Am Jur 2d, Agency, 58). The loss of capacity may be the result of insanity or mental incompetence, temporary or permanent.

But a durable power of attorney permits the principal to create an agency in someone that continues in spite of the principal's later loss of capacity to contract. The only requirement is that the instrument creating the power contains language showing that the principal intends the agency to remain effective in spite of his later incompetence (3 Am Jur 2d Agency, 28). Our law requires that the document contain the words” this power of attorney shall not be affected by the subsequent disability or incompetence of the principal, or words of similar import showing the principal's intent is that the authority conferred may be exercisable even though he becomes disabled or incompetent” (CGS 45a-562).

If the probate court appoints a conservator for the principal's estate, any durable power of attorney in effect immediately ceases and the “attorney in fact” must account to the conservator rather than the principal (CGS 45a-562(b)).

Anyone may file a petition with probate court to have a conservator appointed to handle someone's personal or financial affairs. A person who the court appoints to handle someone's financial affairs is called a “conservator of the estate.” The court appoints such a conservator if it determines that a person is incapable of managing his affairs. This means that he has a mental, emotional, or physical condition resulting from mental illness, mental deficiency, physical illness or disability, chronic use of drugs or alcohol, or confinement, which prevents him from managing his affairs, and (1) he has property that will be wasted unless proper management is provided, or (2) funds are needed for his support, care or welfare or for others he supports and he is unable to take necessary steps to obtain or provide funds that are needed (CGS 45a-644).

GC:ts