Are individuals advised to create documents or take other steps in view of their possible mental incapacity and, if so, what are the main features of the advisable arrangements?
Private Client (2nd edition)
The Israeli Legal Capacity and Guardianship Law 1962, provides certain instructions when a person loses capacity, including, the appointment by the court of guardians to individuals who lack legal capacity. The legal actions of these individuals require the authorisation of the guardians or the court (similar to the actions of minors).
However, an individual can create a power of attorney which shall enter into force upon the occurrence of pre-determined events – such as incapacity of the individual. Such power of attorney may bestow powers in relation to financial matters, to health matters or any other matter, all as defined in the relevant power of attorney. The Israeli Legal Capacity and Guardianship Law 1962 set certain conditions which have to be fulfilled in order for such power of attorney to be valid and enforceable.
Individuals are advised to make an enduring power of attorney, which gives one or more persons authority to make personal care decisions and financial decisions on their behalf in the event that they lose capacity.
Following the commencement of the Assisted Decision-Making (Capacity) Act 2015 individuals will also be able to enter into various types of assisted decision making agreements depending on their level of capacity, and will also be permitted to enter into advanced healthcare directives which will allow them to outline their wishes and preference concerning healthcare treatment in the event that they lose capacity.
In a so-called ‘living will’, one can anticipate potential legal incapacity by making ‘extrajudicial protection’ arrangements. These arrangements can deal with personal matters (e.g. health matters) and/or the administration of property. By giving a power of attorney while still capable, one can avoid a court-appointed administrator.
Yes. Individuals are advised to execute documents to deal with both medical and financial decisions in the event of mental or physical incapacity. The names and forms of these documents differ by state, but the concepts are the same. The first document, often referred to as a ‘Living Will’, allows an individual to provide specific instructions about his or her medical treatment in the event of incapacity; for example, an individual can direct that he or she does not wish to have a feeding tube to be kept alive. The second document, often referred to as a ‘Health Care Proxy’, allows an individual to appoint someone to make medical decisions on his or her behalf (to the extent not already provided for in the Living Will) if he or she is unable to do. Finally, a durable power of attorney is recommended to name an agent to act on a person’s behalf with respect to his or her financial matters. Some states require that this document be effective immediately, but in most states there is an option to have the document become effective upon the principal’s incapacity. Under either scenario, the durable power of attorney will remain effective through the principal’s incapacity and terminates at his or her death.
The general consensus is that any arrangement in the nature of a UK lasting power of attorney would cease to have effect if the person who had given it lost legal capacity.
In Austria one can set up a long lasting power of attorney in which one appoints a proxy who can make all these positions over all assets including bank savings, bank accounts, real estate (but then notarised signed).
A long lasting power of attorney becomes legally effective only in connection with a medical confirmation that the giver of the power of attorney is no longer legally competent. A long lasting power of attorney has to be entered in a register of powers of attorney.
In addition there is the institute of the healthcare proxy in which it can be regulated which medical treatment in the event of illness should not be carried out if and when the patient is no longer able to express his will.
The existence of a healthcare proxy (not its contents) is also recorded in a register.
Generally, any document created by a person that is afterwards found to be mentally incapacitated, could be challenged. Guardianship (full or partial) is governed by the law. Therefore, the answer would be no, individuals are not advised to create documents or take other steps in view of their possible mental incapacity.
Legislation is currently being considered to amend the provisions of the Civil Code relating to the judicial protection of adults who, by reason of an impairment or insufficiency of their personal faculties, are not in position to protect their interests (Draft Law No. 958).
The main innovation of the proposed reform is the creation of the “mandate for future protection” (mandat de protection future) to allow any adult to make advance arrangements for his/her care or representation in the event of incapacity, but also for the protection of his/her children.
The Draft Law (No. 958) also includes conflict of law rules in line with those set out in
The Hague Convention of 13 January 2000 on the International Protection of Adults (ratified by Monaco in 2016).
Italian law allows an individual to designate, by notarial deed, another individual as a candidate for the appointment as his/her guardian. If the appointing individual becomes then incapacitated, the competent Italian court will appoint another individual as a guardian, which assists or replaces (depending on the degree of incapacity) the incapacitated in dealing with the assets. The court can appoint an individual different from the candidate only on the ground of serious reasons.
There are no statutory power of attorney provisions in Bermuda, however the trust laws contain provisions which determine if someone had capacity when they created a trust.
26.1 Under English law, an individual (called the donor) may, by creating a Lasting Power of Attorney ("LPA"), give authority to one or more individuals (called attorneys) to deal with the donor's property or make decisions relevant to the donor's health and welfare if the donor loses mental capacity. One kind of LPA relates to decisions about the donor's property, and another kind of LPA to decisions about the donor's health and welfare (such as whether the donor should go into a nursing home or receive life-sustaining medical treatment).
26.2 If more than one attorney (§26.1) is appointed under a LPA (§26.1), the attorneys can be appointed to act either jointly (in which case they must decide everything together) or jointly and severally (in which case one of them alone may make a decision). The donor (§26.1) may also specify binding or non-binding preferences in a LPA. Attorneys come under the supervision of the Court of Protection.
26.3 If no LPA (§26.1) has been created by an individual who becomes mentally incapable of managing his property, an application must be made to the Court of Protection for a the appointment of a "deputy", who has a similar role to that of an attorney (§26.1) appointed under a LPA. The creation of a LPA is simpler, quicker and cheaper than such an application, and allows the donor (§26.1) to decide certain matters in advance and to choose who will be making decisions on his behalf.
26.4 An English LPA (§26.1) is, in practice, of limited relevance to a donor (§26.1) who is not living in England and whose assets are situated outside England.
Under Colombian law, any individual is subject to legal rights and obli¬gations except for individuals declared incapable by a judge after a medical evaluation and due process.
An individual may be declared incapable by means of a voluntary interdiction whereby a judge declares that an individual is unfit to exercise his or her rights and obligations. Once the individual has been declared incapable to handle his or her own affairs, the judge will designate a guardian to take care of the individual’s affairs.
In anticipation of a mental incapacity, an individual may implement contractual arrangements or structures to protect her/his assets making sure there is enough evidence showing that the individual is capable at that moment.
Although individuals may exercise their legal powers in whatever way they would like, proof of testamentary capacity will need to be established whenever there are questions in relation to certain individuals executing documents. This involves proof of the capacity to understand certain important matters relating to the instrument in question such as its nature and effect, the property being disposed of, and the claims which may arise as a result. Also required is actual knowledge and approval of the contents of the instrument.
The Mental Health Law, 2013 gives the Cayman Islands Grand Court (the Grand Court) the power "to do or secure the doing of all such things as appear desirable for the maintenance or benefit of“ a mental health patient, his family and those for whom he might be expected to provide. In exercising such powers, the Grand Court may, on behalf of the patient, arrange for another person to deal with relevant property, enter into any settlement, manage a business, dissolve a partnership, complete a contract, conduct legal proceedings and act as trustee.
Further, the Grand Court Law (2015 Revision) states: "The Court shall have the power to appoint guardians of the persons and estates of persons of unsound mind or suffering from mental illness and for that purpose to enquire into, hear and determine by inspection of the person the subject of such enquiry, or to examine on oath or otherwise the party in whose custody or charge such person may be, or any other person or persons, or use such other ways and means by the truth may be discovered".
In case an individual loses his legal capacity, a guardian is appointed by the court. The guardian represents the individual’s interests and is supervised by the court.
It is highly recommended that an individual stipulates both a Patient Decree (“Patientenverfügung”) and a power of attorney (“Vorsorgevollmacht”). Thus, the appointment of a guardian that is a third person can be avoided as in this case the guardian chosen by the individual will be appointed by the court.
Individuals can consider creating a Lasting Power of Attorney ("LPA") to appoint donees for the management of his / her personal welfare and / or property affairs in the event of loss of mental capacity. The LPA is a creature of the Mental Capacity Act. For the LPA to be valid, it must be registered with the Public Guardian.
Provisional arrangements for future incapacity are not common in Portugal. The legitimacy to implement restrictions of asset disposal by individuals rests mainly with the spouse and/or the family. The most common procedure is disabling an individual from being able to dispose of assets, by proof of incapacity.
Because the Civil Code organises the protection of persons losing capacity, nothing is provided allowing the individual to make his/her own arrangement in view of his/her mental incapacity and decisions about medical treatment.
It is however the authors’ opinion that because nothing in the law prohibits the possibility for an individual to provide his/her wishes, it is suitable to prepare such a document. One may expect that the mentality will shift in the future encouraging the French judge considering such a document as binding.
A “mandate for future protection” (Mandat de protection future) can however be drawn up (either under the form of a notarial deed or a private document) in the view for the “mandator” to appoint in advance one or more persons (agent) to represent him. At the moment the mandator will no longer be able, physically or mentally, to provide for his own interests, the agent may then act to protect the mandator’s personal and / or patrimonial interests.
Offering more flexibility, the trust remains an appropriate tool to organise the mental incapacity and other decisions despite the fact that trusts set up by French resident individuals are subject to inheritance tax at the rate of 60% if set up after 11 May 2011.
Individuals are advised to issue a healthcare proxy (Vorsorgevollmacht). A healthcare proxy is a power of attorney which shall, according to its content, become effective if the principal loses the required legal capacity or mental capability or his capability of expression. Matters for which power of attorney is granted have to be specified.
If the healthcare proxy shall also include consents to certain medical treatments or decisions as to the management of assets which are beyond the ordinary course of business, it has to be established, expressly referring to such matters, before an attorney or court.
A healthcare proxy can be revoked at any time.
Mexican law regulates two different figures to address the mental disability of a person: guardianship and conservatorship.
In accordance with article 449 of the Mexican Federal Civil Code, the object of the guardianship is the protection of the person and property of those who not being subject to parental authority have natural and legal incapacity to govern themselves.
In the other hand, conservatorship is planned to monitor the conduct of the guardian and to inform the judge of anything that he or she considers may be harmful to the incapacitated person.
Mexican law does not allow any of the previous positions to be appointed by the person that is incapable, nor that a person can decide who will be their guardian or curator in view of an imminent disability, since the appointment of these positions is previously established in the Law.
Given this circumstance, people who are in Mexico cannot take any previous step or preventive measure against an eventual mental disability.
Individuals may by authentic document declare their will of who should be their committee in case of incapacity. However, the appointment of committee is made only by court, considering: (1) the order of preference provided for by law (i.e. if there is a husband/spouse, he/she will be the committee, in their absence, it will be their ascendant, and in their absence, it will be their descendants; and if none of them can be, the judge will choose the committee); and (2) the best interest of the individual.