The pivotal case of Masterman-Lister v Brutton and Co  EWCA remains one of the fundamental precedents referred to in considering mental capacity in litigation. In the case of Masterman it was stated that “ English Law requires that a person must have the necessary mental capacity if he is to do a legally effective act or make a legally effective decision for himself.
Since the Judgment in the case, the Mental Capacity Act 2005 (“MCA”) has come into force and provided the definition for a person lacking capacity to conduct proceedings. Persons lacking capacity to conduct proceeds are referred to as a ‘protected party’. The MCA also enables other people to make decisions on their behalf, it does so by allowing an ‘Attorney’ to be appointed under a Lasting Power of Attorney or a Deputy appointed by order of the Court of Protection. The MCA constitutes safeguards which ensure that the decisions made on the person’s behalf is always in their best interest.
Although the stance, under the first Principle of the MCA, is that a person must be assumed to have capacity unless it is established that he lacks capacity. Where there is in doubt, capacity must be assessed. In the recent case of Mr and Mrs Z v Kent County  EWFC, the Judge stated “ One significant intention of the presumption of capacity is to prevent inaccurately assuming lack of capacity in apparently vulnerable individuals without being properly established on evidence. It is emphatically not there to obviate an examination of such an issue. Nor can it have been Parliament’s intention to place a vulnerable person in danger of their lack of capacity being overlooked at the expense of their rights by a slack reliance on this presumption”.
The Court may not always consider capacity however the onus lays with the solicitor and/or the person responsible for the affairs for the Protected Party, to ensure that they comply with the requirements under the Civil Procedure Rules once it has been established the party subject to the Claim lacks Capacity. Such a protected person must have a litigation friend, who will conduct the proceedings and until such appointment has been made the only limited action that may occur is the issuing of a claim form.
Whilst settlement is always encouraged in any court proceedings, in the case where the claim involves a protected party any settlement or compromise needs to be validated with the approval of the Court.
The courts will also order a detail assessment of costs where sums are payable by any protected party.
Written by - Nilojana Nirmalan, Paralegal
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