‘Mental Capacity’ is whether a person has sufficient capacity in law to make particular decisions.  If they do not have that capacity they are known as a ‘Protected Party’ and certain additional rules apply.

This is a complex area of law.  The definition of Mental Incapacity under the Act is ‘a person lacks capacity in relation to a matter if at the material time he is unable to make a decision for himself in relation to the matter because of an impairment of, or disturbance in the functioning of the mind, or brain’, it is clearly relevant in the more serious brain injury cases.

It is worth noting that under the Mental Capacity Act 2005, a person is assumed to have capacity unless it can be shown with medical evidence that they lack the appropriate capacity to make a particular decision or set of decisions.

However establishing incapacity is a judicial and not a medical issue.  Where in the spectrum between total capacity and total incapacity an individual lies involves an assessment of all the evidence.

It is immaterial whether the impairment or disturbance in question is long lasting or temporary, it has to be considered at the time a particular decision is being made.  However when considering whether an individual lacks the capacity to conduct proceedings, the proceeds must be viewed as a whole – Bailey v Warren [2006] EWCACiv 51.

Under section 3 of the act a person is unable to make a decision for himself if he is unable to:

  1. understand the information relevant to the decision;
  2. retain that information;
  3. use or weigh that information as part of the process of making the decision;
  4. communicate his decision (whether by talking, using sign language or any other means).

If a person is deemed to lack capacity, what is known as the Court of Protection which is a Court specifically set up to deal with the affairs of people who lack capacity, is authorised to make decisions on behalf of such people in respect of both their personal welfare and/or property or financial matters.  Alternatively the Court may appoint a person (‘a Deputy’) to make decisions on behalf of the protected person in relation to specified matters, eg dealing with that person’s financial affairs (we have set up a whole separate section on the Court of Protection as this is clearly very important to the subject of brain injury).

If a person is deemed to ‘lack capacity’ then any decisions that are made on his or her behalf must be made in their best interests.

What happens in cases where there is a claim in civil proceedings (ie for compensation) when the Claimant lacks capacity?

If, which often happens in cases of brain injury, the injured party lacks capacity to deal with the litigation (which includes giving his solicitors instructions) then the Court will appoint what is known as a ‘Litigation Friend’ to conduct the proceedings on behalf of the ‘Protected Party’.  This is normally a relative or friend providing there is no conflict of interest and they are capable of competently conducting the proceedings on behalf of the injured party.

Compromise and Settlement of the Claim

Furthermore, if a person lacks mental capacity to conduct proceedings, then if there is any compromise or settlement of the claim (ie an agreement to pay damages) then formal approval of the compensation must first be obtained from the Court.  Normally, without such approval the settlement of the case is neither binding nor enforceable.  The purpose of such approval is to ensure that the settlement and award is fair from the protected party’s perspective.