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Capacity and Its Implications for Personal Injury Claims

09th November 2020

Having capacity to make decisions for yourself is something many of us, without realising, take for granted on a daily basis.  For many suffering with a brain injury after an accident, the simple process of being able to make a decision is fraught with complication and stress.

What is capacity?

Capacity is defined as the ability to understand, weigh up and retain information to make a decision and then communicating said decision to others.

Capacity is time and decision specific meaning that the ability of the person in question to make a decision should be assessed at the time the decision needs to be made. A decision on whether someone lacks capacity should not be based solely on their age, appearance, condition or behaviour.  It is not the case that once a person lacks capacity in relation to once decision, they lack capacity in respect of all decision making.

The Mental Capacity Act 2005 (MCA 2005)

There are five statutory principles outlined in section 1 of the Act which are designed to protect people who lack capacity to make certain decisions but also to maximise their ability to make decisions or participate in decision making as far as they are able to do so.  The five principles are as follows:

  1. A person must be assumed to have capacity unless it is established that they lack capacity
  2. A person must be given all practicable help before they are treated as not being able to make their own decisions
  3. A person is not to be treated as unable to make a decision because others may regard the decision as unwise of eccentric
  4. Any act done or decision made on behalf of a person who lacks capacity must be done in their best interests.
  5. Someone making a decision or acting on behalf of a person who lacks capacity must consider whether it is possible to decide or act in a way that would interfere less with the person’s rights and freedoms of action, or whether there is a need to decide or act at all.

How is capacity assessed?

The MCA 2005 sets out a two-stage test for assessing an individuals capacity.  The first stage (known as the Diagnostic Stage) asks the following questions:

  1. Does the person have an impairment of their mind or brain, whether as a result of an illness, or external factors such as alcohol or drug use?
  2. Is the impairment or disturbance sufficient that the person lacks the ability to make that specific decision?

The second stage (known as the Function Test) dictates that a person is unable to make a decision if they cannot:

  1. Understand information about the decision to be made
  2. Retain that information in their mind
  3. Use of weigh-up the information as part of the decision making process
  4. Communicate their decision

Failure to do any of the above represents a lack of capacity.

Capacity and personal injury claims

Capacity is very much a live issue in personal injury claims and should always be at the forefront of any personal injury solicitors mind when dealing with client’s that have sustained a brain injury, irrespective of how serious the injury might be.

It can be a scary and lonely place for a client when they struggle with having to make decisions about their case or money.  Often client’s feel overwhelmed, helpless and anxious but steps can be taken to protect the client from this.

Assessment of the client’s capacity is carried out by one of the medical experts instructed in the case, ordinarily either a neuropsychologist or psychiatrist.  They will be asked to consider two points.  Firstly, whether the client has capacity to run their legal case and secondly, if they have capacity to manage their financial affairs.

When a client is deemed to lack capacity to manage their legal case, a Litigation Friend is appointed.  This can be a parent, partner, sibling or in cases where there is no suitable candidate the Official Solicitor can be appointed.  The role of the Litigation Friend is to “step into” the shoes of the client and make decisions on their behalf.  How much the injured person wishes to be involved in the legal case once a Litigation Friend is appointed is a matter for them.  Some are happy to be a part of discussions about the legal case, others are content leaving it all to their Litigation Friend.  Although the injured person is no longer making the decisions it is important that they feel as involved in the process as they want to be.  Ultimately decisions made during the course of the case will likely affect their life in some way and they may not wish to be cut out completely.

When a client is deemed to lack capacity to manage their financial affairs, a Deputy is appointed by the Court of Protection.  The Deputy assumes decision making responsibility in respect of the injured persons financial matters.  Often, in brain injury cases, this will include ensuring rent and bills are paid on time, authorising the instruction and payment of rehabilitation professionals as well as ensuring suitable funds are made available to the injured person to support day to day living (some client are able to manage a small weekly allowance which is paid to them by the Deputy for general living expenses).  A Deputy must report to the Court of Protection on a regular basis and produce accounts evidencing the money spent each year.  As with a Litigation Friend, the Deputy must act in the inured person’s best interest.  Importantly, a Deputy also protects the injured person from being exploited financially as many brain injured clients can be vulnerable to those around them who wish to take advantage.  A Deputy will carefully consider any request for money (no matter the sum or what it is intended to be used for) before it is paid.  This Firm has an excellent Court of Protection Team, headed by partner and professional Deputy Ursula Watt, with whom the Personal Injury Team work closely with on several cases.

A Litigation Friend will remained appointed until the legal case has concluded.  The appointed Deputy will remain on board for many years post-settlement and will continue to manage the injured persons compensation award until such time as their involvement is no longer required (for example after the death of client or if the client regains capacity).

It should be remembered that someone who may lack capacity at one point in time in respect of a decision may regain the ability to make the same decision at a later point in time.  Thus, the issue of capacity is something which needs to be kept under constant review, even once a compensation claim is concluded.

If you would like to know about capacity issues please contact us on 01243 786668 or at info@georgeide.co.uk 

Karen Jenkins. Solicitor, personal injury department

General, George Ide, News, Personal Injury Blog, Private Client
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