Understanding capacity

  1. Decision-making capacity (or simply “capacity”) refers to individuals’ ability to make particular decisions or take actions that influence their lives. In a legal context, capacity is concerned with whether a person’s decision-making ability is recognised as valid and, if not, who should make decisions on their behalf and on what basis should such substitute decisions be made.

  2. Capacity or incapacity is the “bright line” determining whether the law permits intervention in people’s lives, and on what basis.24 Those who lack capacity are deemed unable to make decisions for themselves thereby justifying intervention in their lives. Decisions are then made by others based on an assessment of what is in the best interests of the person lacking capacity. Those with capacity are free to make decisions about their lives, even decisions that may be regarded as unwise, subject to the constraints of the law.25 Concerns may still arise as to whether an individual is competent to make a particular decision, or is merely acquiescing under pressure from others (referred to in law as “undue influence”), and concerns may exist as to the extent to which such influence affects their capacity for decision- making.

  3. Capacity is decision and time specific. Lack of capacity may arise for a variety of reasons and may be partial or total. When lack of capacity is temporary or fluctuating it may be possible to defer decisions until capacity is restored. But if it is of lasting duration or permanent, or if an urgent decision otherwise needs to be made, there must be some legally recognised procedure whereby necessary decisions can be made by some other person or body.26

  4. Decision-making capacity can affect people of all ages and arises in a variety of social environments and healthcare settings. A range of conditions and disabilities can impair capacity; the most common of these, in the context of community care of older people, is dementia.27 It is difficult to predict from the stage of dementia whether a person retains or has lost the capacity to make a particular decision. Measures of dementia severity correspond only approximately with capacity. It is important to recognise that different types of dementia may impair capacity in different ways. The most common form of dementia, Alzheimer’s disease, affects memory in the first instance, whilst dementia secondary to vascular disease of the brain tends to impact on frontal and subcortical systems, causing problems with higher cognitive functions.

  5. Delirium is a disorder that is seen more commonly in residential care and hospital settings and is characterised by a relatively sudden decline in cognitive function, or fluctuations in such function, and impaired attention. It occurs in the context of physical illness or toxic states and may represent the first time a capacity assessment is required. Head injury (or acquired brain injury) and intellectual disability (in England referred to as learning disability) are usually chronic, stable states where it is more likely the person’s abilities will be understood and the focus should be on optimising the person’s capacity.

  6. Mental incapacity is not the same as mental disability. Mental disability, including mental illnesses such as depression, anxiety and psychosis, can impair capacity in a number of ways, including by causing forgetfulness or reducing the person’s ability to think through complex issues, through inattention, or by causing a bias in reasoning to the point of impairing capacity. In psychiatry, there are approaches for making self-binding directives (the Ulysses Contract) by which patients with bipolar affective disorder commit themselves to treatment during episodes of mania, even if unwilling. For certain individuals, this can seem the most rational way to deal with their fluctuating condition.28

  7. The prevalence of patients who lack capacity in New Zealand hospitals and care facilities is unknown. A recent review of 58 international studies of capacity found 45% of patients in psychiatric settings and 34% of patients in general medical settings lacked decision-making capacity.29 Two million people in the UK are estimated to lack capacity through illness.30 There is nothing to suggest that the proportion of people that lack capacity throughout the healthcare institutions in New Zealand is dissimilar; nearly a third of patients may be regarded as not having legal capacity for decision-making.

24 M Donnelly “A Legal Overview” in C Foster, J Herring and I Doron (eds) Law and Ethics of Dementia (Hart Publishing, Oxford and Portland, 2014) 271 at 278.

25  I Goold and J Herring “Palgrave Great Debates in Law” in J Herring (ed) Medical Law and Ethics (5th edition, Oxford University Press, Oxford, 2014).

26  G Ashton Mental Capacity Law and Practice (2nd ed, Jordans, Bristol, 2012) at 2.

27 Dr Greg Young, consultant psychiatrist, Capital and Coast District Health Board.

28 G Owen and T Gergel “Fluctuating Capacity and Advanced Decision Making in Bipolar Affective Disorder – Self-Binding Directives and Self Determination“ (2015) 40 Int J Law Psychiatry 92 at 95.

29 P Lepping, T Stanly and J Turner “Systematic review on the prevalence of lack of capacity in medical and psychiatric settings” (2015) 15 Clin Med (JRCP) 337. The study looked at the average proportion of patients and showed that psychiatric patients with psychosis, dementia and mania are more likely to lack decision-making capacity than those with depression or personality disorder. Likewise, in general medical settings, patients with learning disabilities, delirium and neurological disease were most likely to lack capacity.

30 T Nicholson, W Cutler and M Hotopf “Assessing mental capacity: the Mental Capacity Act” (2008) 336 BMJ 322 at 322.

Assessment of capacity

  1. Deciding whether a person has the capacity or competence to make particular decisions is a legal, and in some cases judicial, determination, informed by medical evidence.31 Capacity can be difficult to assess, may not be clear-cut and involves value judgments about people’s preferences and beliefs. To deprive people who are capable of making their own decisions of the right to do so would be an abuse, yet failure to recognise lack of capacity results in continuing vulnerability.

  2. The careful assessment of the individual’s capacity to make particular decisions is crucial. This turns on an understanding of the kinds of decisions to be made, the legal thresholds for capacity, and a judgment of the point at which a person is considered incompetent or lacking capacity. Getting the process for these decisions right is essential to the protection of a person’s rights and in determining the legal consequences that follow.

Legal capacity

  1. The term “legal capacity” recognises the legal right to exercise rights and legal status.32 Legal capacity has a particular meaning in the context of international conventions such as the Convention on the Rights of Persons with Disabilities (CRPD), where it is understood to refer to a person’s possession of rights and the ability to act on those rights on an equal basis with others without discrimination on the grounds of disability. The right to legal capacity includes, for example, having the right to choose where and with whom you wish to live, and most importantly, having those choices respected. The concept is relevant to all areas of an individual’s life, including the exercise of legal capacity to enter a contract, to marry, to vote, to deal with property and to make personal life, personal care and healthcare decisions.33

  2. Under New Zealand law, people who lack capacity and are subject to the adult guardianship legislation (the PPPR Act) may be regarded as having the same legal rights as others except to the extent their rights are expressly limited by the PPPR Act or other legal principles.34

  3. “Legal capacity” is distinct from “mental capacity”, the latter being the cognitive ability considered necessary to exercise one’s legal rights. In discussing mental capacity ,the terms “decision-making capacity” or “competence” are often used in the clinical context35 as a descriptor of the mental or cognitive characteristics considered necessary to exercise legal capacity.36 Despite the potential to confuse legal capacity (a legal concept) and mental capacity (the cognitive abilities required), the term “mental capacity” is the one used in the legislation in the United Kingdom.37

31 In McFadzean v Moleta [2013] NZHC 1601, a case involving the assessment of a person’s testamentary capacity, Collins J observed at [7]: “Unfortunately, while the law and medicine intersect, the two disciplines are not synchronised”.

32 R Firmston and A Ruck Keene The International Protection of Adults (Oxford Press, Oxford, 2015) at 67.

33 M Bach and L Kerzner “A new paradigm for protecting autonomy” (2014) Ontario Law Commission http://repositoriocdpd.net:8080/handle/123456789/449 at 16.

34 Protection of Personal and Property Rights Act 1988. Section 4 provides that the legal capacity of a person who may be subject to the Court’s jurisdiction and in respect of whom an order is made may be regarded as having the same legal rights as anyone else unless those rights are expressly limited, varied, or taken away under the Act or some other Act.

35 These terms also get confused with the legal concept of capacity. C Duncan, psychiatrist Capital and Coast District Health Board, “The Red Flags and Pitfalls of Assessing Capacity”, presentation to Bioethics Centre, University of Otago, 7 September 2015. Interview with G Owen, psychiatrist, Kings’ College London (A Douglass, London, 22 April 2015). In the United States, “competence” is generally used as the legal term: Buchanan Brock Deciding for Others, The Ethics of Surrogate Decision Making (Cambridge University Press, 1990).

36 The Protection of Personal and Property Rights Act 1988 uses “capacity” and “competence” interchangeably and the Code of Rights refers exclusively to “competence”. For ease of reference I use the terms “capacity” or “mental capacity”.

37 Mental Capacity Act 2005 (England and Wales), Mental Capacity Bill (currently before the Northern Ireland Parliament), Adults with Incapacity Act 2000 (Scotland) and the Supported Decision-Making (Capacity) Act 2015 in the Republic of Ireland. Note also the Mental Capacity Act 2010 (Charter 177A) Singapore which almost entirely adopts the English legislation.


  © Copyright 2017 Alison Douglass