Ethical Gymnastics: The Balance of Understanding A Client's Capacity

Imagine this scenario: A 90-year-old client, now in hospice care, is brought into your office by a caregiver who is insistent that your client wants to make a change to his will. Though he recognizes you, his long-term estate planning attorney, you notice a marked decline since your last meeting. Thus, when he articulates the requested changes, a red flag is raised. Suddenly, a house that was once left to the man’s child and funds once left to a beloved charity are redirected to the caregiver. This doesn’t seem right. What’s your next move? Do you proceed with these changes immediately and without question? Most attorneys would instinctively say no. Yet, scenarios giving rise to capacity concerns are rarely this straightforward.

An understanding of testamentary capacity is crucial as attorneys have an ethical obligation to ensure their client’s capacity at all stages of the estate planning process. At its core, testamentary capacity refers to an individual’s ability to create a valid will (though it extends to the full breadth of estate planning documents). The cognitive components required for an individual to create a valid will include a clear comprehension of the nature and extent of their assets, the ability to recognize their natural beneficiaries, and the ability to link these elements into a cogent estate plan. Despite its seemingly straightforward nature, assessing capacity can be complex.

Attorneys must meticulously document their observations and any steps taken to verify capacity. This documentation not only protects the client’s interests but also upholds the integrity of the legal process, especially if the estate planning documents face challenges based on capacity concerns down the road. Given the nature of the practice, estate planning attorneys often have decades-long relationships with clients as family and financial circumstances evolve over time. This gives you a unique opportunity to track an individual’s cognition and potentially catch a decline before it becomes a larger issue and jeopardizes a well-made estate plan.

In my previous experience within the trust and estate realm of wealth management, I frequently sat in on tense meetings between estate planning attorneys wherein the contents or interpretation of an estate plan did not align with the expectations of the client’s family, potential beneficiaries, or interested third parties such as caregivers and close friends.

In my role, I was often able to meet with testators for years prior to their passing, allowing me to observe their estate planning process from initial meetings to finalization and eventually amendments (there are always amendments!). These meetings allowed me to not only understand the client’s estate plan but also to get a feel for the person—their life story, goals, and ultimately why they made the decisions they did pertaining to their estate plan.

This background information allowed for a comprehensive view of a client’s mental state and reasoning when executing estate planning documents and greatly assisted in instances where, if later challenged by the aforementioned disgruntled parties, I could speak to capacity concerns. Essentially, this was an additional line of defense for the drafting attorney. After all, the presence of family tension does not necessarily indicate a lack of capacity. However, such disputes may prompt beneficiaries or other interested parties to challenge the attorney’s decisions and take those challenges to court.

These issues can present in many ways. What happens when a long-term client makes a decision that you, as the estate planning professional, question? For example, I worked with an individual who was in the habit of disinheriting people she had a conflict with, then mere months later, completely reversing her plans and reinstating the same individual. In one such amendment, she disinherited an adult child acting as her in-home caregiver assisting with tasks of daily life. She did so in favor of an individual she had disinherited.

While this was not dispositive of cognitive decline, it did raise questions. I spoke with her estate planning attorney about these concerns and we individually asked her several questions about her present circumstances, assets, and overall thoughts to ensure she had a clear understanding of what the decision meant and could articulate her reasoning behind it. In this instance, documentation was key to safeguarding the client. Ultimately, her estate plan was challenged by the disinherited beneficiary, but it never made it to litigation as all capacity questions were expeditiously dispensed with.

So, what practical steps should an attorney take if they suspect capacity issues? Rule 1.14 (6) of The ABA Model Rules of Professional Conduct provides guiding factors to “consider and balance” in these circumstances including: 1/ the client’s ability to articulate reasoning leading to a decision, 2/ variability of state of mind and ability to appreciate the consequences of a decision; 3/ the substantive fairness of a decision; and 4/ the consistency of a decision with the known long-term commitments and values of the client. Rule 1.14 goes on to say, “in appropriate circumstances, the lawyer may seek guidance from an appropriate diagnostician.”

In practical terms, this means if you notice a decline, question a seemingly strange decision, or generally have concerns about a client's cognitive well-being, you are in a unique position, and have an obligation, to probe a bit further. If questions or concerns remain, you can also reach out to medical professionals to seek an expert opinion. Suggesting that your client obtain a clinician’s opinion on their cognitive function and decision-making ability may also be a prudent course of action. As noted above, the first line of defense is documenting observations and keeping meticulous notes.

This is outside the scope of this brief post, but please do consult the RPC for further guidance on confidentiality and maintaining an attorney-client relationship when dealing with a client with diminished capacity. This is an incredibly important and far-reaching topic, and folks much smarter than I have written volumes on it.

In conclusion, while attorneys are not responsible for making final determinations of capacity—that duty falls to the courts and healthcare professionals—they play a pivotal role in ensuring that all ethical and legal boxes are checked before signatures are in place and an estate plan is complete. Addressing capacity concerns proactively is essential to prevent future disputes and ensure your client’s testamentary intent is fulfilled.