Can an Incapacitated Person Sign A Valid Contract During a Lucid Moment?
Full Question:
Answer:
A contract must be signed by a person while having the capacity to understand the nature of her actions in order to be legally valid. A contract signed by a person while a doctor's written opinion states that person lacks capacity will be vulnerable to being attacked as invalid due to lack of capacity. While it is possible for courts to uphold a contract made by an incapacitated person during a period of lucidity, it will be a matter of subjective determination for the court, based on all the facts and circumstances involved, that the person had lucidity at the moment of signing. Testimony from witnesses and doctors' opinions may be some of the evidence considered by the court. However, a person should make sure any estate arrangements are insulated from claims of incompetence or undue influence. A contract signed while is declaration of incapacity is in effect may be subject to challenges at a later date.
It is possible for a doctor to sign a declaration that a patient has regained capacity, so that a power of attorney will be no longer be effective and the person may contract on her own behalf. When declared by a physician to have regained competency, a person may revoke a power of attorney. Acts taken by an agent with knowledge that the principal has regained capacity or has revoked the power of attorney are not valid.
The following are MA statutes:
.L.c. 201B, § 2. Effect of acts pursuant to durable power of attorney. [EDITORS' NOTE: THE TEXT OF THIS SECTION IS REPEALED EFFECTIVE JULY 1, 2009.]
Section 2.
All acts done by an attorney in fact pursuant to a durable power of attorney during any period of disability or incapacity of the principal shall have the same effect and inure to the benefit of, and bind the principal and his successors in interest, as if the principal were competent and not disabled.
G.L.c. 201D, § 6. Determination that principal lacks capacity to make or to communicate health care decisions; notice; objections to agent's decision; determination of regained capacity.
Section 6.
The authority of a health care agent shall begin after a determination is made, pursuant to the provisions of this section, that the principal lacks the capacity to make or to communicate health care decisions. Such determination shall be made by the attending physician according to accepted standards of medical judgment. The determination shall be in writing and shall contain the attending physician's opinion regarding the cause and nature of the principal's incapacity as well as its extent and probable duration. This written determination shall be entered into the principal's permanent medical record.
If the attending physician determines that a patient lacks capacity because of mental illness or developmental disability, the attending physician who makes the determination must have, or must consult with a health care professional who has, specialized training or experience in diagnosing or treating mental illness or developmental disabilities of the same or similar nature in making such determination.
A physician who has been appointed as a patient's agent shall not make the determination of the patient's capacity to make health care decisions.
Notice of a determination that a principal lacks capacity to make health care decisions shall promptly be given orally and in writing:
(i) to the principal, where there is any indication of the principal's ability to comprehend such notice;
(ii) to the agent; and
(iii) if the patient is in or is transferred from a mental health facility, to the facility director.
A determination made pursuant to this section that a principal lacks capacity to make health care decisions is solely for the purpose of empowering an agent to make health care decisions pursuant to a health care proxy.
Notwithstanding a determination pursuant to this section that the principal lacks capacity to make health care decisions, where a principal objects to a health care decision made by an agent pursuant to a health care proxy the principal's decisions shall prevail unless the principal is determined to lack capacity to make health care decisions by court order.
In the event the attending physician determines that the principal has regained capacity:
(i) the authority of the agent shall cease, but shall recommence if the principal subsequently loses capacity; and
(ii) the principal's consent for treatment shall be required.
G.L.c. 201D, § 17. Court proceedings to settle health care proxy disputes.
Section 17.
The health care provider, the conservator for, or guardian of the principal, members of the principal's family, a close friend of the principal, or the commissioner of public health may commence a special proceeding in a court of competent jurisdiction, with respect to any dispute arising under this chapter, including, but not limited to, a proceeding to:
(i) determine the validity of the health care proxy;
(ii) have the agent removed on the ground that the agent is not reasonably available, willing and competent to fulfill his or her obligations under this chapter or is acting in bad faith; or
(iii) override the agent's decision about health care treatment on the grounds that: the decision was made in bad faith or the decision is not in accordance with the standards set forth in section five.