Banks v Goodfellow Is Not Replaced By The Mental Capacity Act 2005

Anyone who has studied the law will no doubt have come across the longstanding case of Banks v Goodfellow, which sets out the law for assessing testamentary capacity (put simply, whether or not someone is able to execute a valid Will). The rules are that for a testator to execute a valid Will they must:

• Understand the effects of making a Will;
• Understand the property of which they are disposing of in the Will;
• Understand and appreciate the claims which they should give effect; and
• To have no disorder of the mind that interferes with their sense of right or prevents the use of their natural faculties in disposing of property in their Will.

The degree of the testators understanding would then differ depending on the complexity of the Will and assets being disposed of.

The Mental Capacity Act 2005, when introduced, set out a number of new guidelines when assessing whether or not an individual retains capacity. This Act is not limited to only testamentary capacity but should be applied for all decisions when there is doubt the individual in question may lack capacity. Section one of the Act sets out the following guidelines to be applied when deciding whether an individual retains capacity:

• An individual is assumed to have capacity unless it is established that he/she lacks capacity;
• A person lacks capacity in relation to a matter if at the material time he/she is unable to make a decision for himself/herself in relation to the matter because of an impairment of, or a disturbance in the functioning of, the mind or brain;
• A person is unable to make a decision for himself/herself if he/she is unable to:
  • Understand the information relevant to the decision;
  • Retain that information;
  • Use or weigh that information as part of the process of making the decision; or
  • Communicate his/her decision;
• An individual is not to be treated as being unable to make a decision unless all practicable steps are taken to assist the individual in making the decision have been taken without success; and
• An individual is not treated as unable to make a decision because they make an unwise decision.

These two tests are similar, save for the Act assumes an individual has capacity unless it is proved otherwise and the requirement of retaining capacity requires the individual to have a greater understanding of the specific decision.

The conflicting tests were recently considered in the case of Clitheroe, Re Probate.

Clitheroe, Re Probate

In this case, the Court previously ruled the Deceased’s Will as being invalid based on the rules set out in Banks v Goodfellow. This decision was appealed on the grounds that the Court had erred in applying Banks v Goodfellow and instead should have applied the Mental Capacity Act.

On appeal, the Court confirmed Banks v Goodfellow was the correct test to be applied and it was further noted the Mental Capacity Act was not intended to replace that test. The appeal was, therefore, dismissed.

Comment

This case confirms Banks v Goodfellow remains good law and should be applied in cases where testamentary capacity is in question. In reality, the tests are similar, albeit the test under the Mental Capacity Act is stricter. The cases where it is argued a testator lacks capacity under one set of rules but retains it for the other rules will, therefore, be few and far between.