GAA – Capacity

If you are unfamiliar with guardianship and administration law, you may want to first read GAA – Guardianship and Administration toolkit.

The power of the Queensland Civil and Administrative Tribunal (QCAT) revolves around whether the Adult has “impaired capacity”. If an Adult has capacity, then the Tribunal lacks jurisdiction to make any orders with respect to that person.

It is, therefore, important that the test for capacity is understood and correctly applied.

Meaning of impaired capacity

Schedule 4 of the Guardianship and Administration Act 2000 (Qld) (GAA Act) provides:

• Impaired capacity, for a person for a matter, means the person does not have capacity for the matter.
• Capacity for a person for a matter, means that the person is capable of:
  • Understanding the nature and effect of decisions about the matter; and
  • Freely and voluntarily making decisions about the matter; and
  • Communicating the decisions in some way.

Legal test

The General Principles presume that the Adult has capacity. There must be sufficient evidence of incapacity to rebut this presumption. In most cases, an application to the Tribunal will be for a particular issue, for example, whether the applicant has capacity to sell their house.

It is only necessary for the Tribunal to look at whether the Adult has capacity for the particular issue in question and not whether the Adult has capacity for all matters.

Understanding the nature and effect of decisions about the matter

The Adult being assessed should understand the information relevant to the decision being made and be able to retain the relevant information long enough for the decision to be made. The Adult does not need to have a complex understanding of the facts but a basic understanding of its key features.

The Adult must also be able to broadly identify the advantages and disadvantages of the options in relation to the decision, and understand the consequences of the options. The Adult should then be able to weigh the different consequences of the various options and come to a decision. Note that a “bad decision” does not necessarily equate to impaired capacity.

Freely and voluntarily making decisions about the matter

It must be clear that the adult is making the decision without pressure or coercion. This may include domineering or overbearing behaviour from family members, friends or carers.

Communicating the decision in some way

There are different ways that an adult can communicate their decision and every support must be provided to facilitate the communication, especially for individuals with physical, intellectual or cognitive impairments. In deciding whether an individual is capable of communicating their decision in some form, the tribunal must investigate the use of all reasonable methods of communication, including for example symbol boards or signing (s146(3) GAA Act).

 

 

Capacity assessment

It may be necessary to obtain medical reports from the Adult’s general practitioner or treating specialist. Other health and allied health professionals who may assist in this process can include geriatricians, rehabilitation specialists, neurologists, psychiatrists, neuropsychologists and occupational therapists.

It is important to note however, that the ultimate test of capacity is not scientific, but whether the Adult satisfies the above criteria for capacity in Schedule 4 GAA Act.

An example of how the tribunal weighs evidence as to capacity for financial decision making, including from conflicting medical witnesses, the Adult and lay witnesses, may be found in the decision WJR v Public Trustee of Queensland [2010] QCATA 39.

The Queensland Capacity Assessment Guidelines 2020 provides further general information about capacity, assessing capacity and the legal test of capacity in Queensland.  The guidelines also set out five principles which should be applied when making an assessment of an adult’s capacity. These are:

1. Identify the decision to be made.
2. Identify a need to assess capacity.
3. Apply the right legal test of capacity.
4. Prepare for the assessment.
5. Conduct the assessment.
6. Document your conclusion and reasons.

 

Authority for the tribunal to make a declaration about capacity

The Tribunal may make a declaration about the capacity of an Adult, a guardian, an administrator or an attorney (such as an attorney under a power of attorney, attorney under an advance health directive or a statutory health attorney) for a matter (s146(1) GAA Act).

When will the Tribunal make a declaration about capacity?

A tribunal may make a declaration about capacity:

• on its own initiative, or
• on the application of the individual (that is, the person whose capacity is at issue), or
• on the application of another interested person (s146(2) GAA Act).

An “interested person” means “a person who has a sufficient and genuine concern for the rights and interests of the other person”: Sch 4 GAA Act.

If necessary, the Tribunal may decide whether a person is an interested person for another person: s126(1) GAA Act.

Effect of declaration about capacity

If an Adult is declared as having capacity for a matter, then the Tribunal will not be able to appoint a guardian or administrator for the Adult (s12, GAA Act) and must revoke any existing appointment (s31(2) GAA Act).

If a person without capacity enters into a contract, then they may be able to argue that the contract is void. They must prove that at the time of making the contract they were incapable of understanding it and the other party was aware or should have been aware of this. This is a principle of common law, subject to any legislative provision to the contrary.

In Queensland, this principle has been legislated in relation to land agreements under s83 of the Public Trustee Act 1978 (Qld). An Adult without capacity cannot deal with land and any such agreement is voidable. However, the agreement will stand if the other party can prove that they acted in good faith for adequate consideration and without knowledge of the Adult’s incapacity.

If the Tribunal makes a declaration about the capacity of an Adult to enter into a contract, then that declaration may be used as evidence of the person’s capacity in any subsequent proceedings in which the validity of the contract is in dispute (s147 GAA Act).

Even if a person cannot argue legal incapacity, for example, because their capacity fluctuates or because they have been declared without capacity for some matters only, they may still be able to have the contract set aside if there has been unconscionable conduct or undue influence by the other party.

This resource is current as of 30 June 2023

The information in this resource is for general information purposes only and should not be relied on as legal advice. If you need legal advice, please contact LawRight or another lawyer. LawRight can only give advice to people who are eligible for our services.