Also known as: lacks capacity · lacking capacity · incapacity
Written by attorneys — see sources below.
A legal disability preventing a person from entering into or being bound by certain legal relations or acts because of mental condition, intoxication, minority, or similar factors.
Logan Lane offers to sell land to Lucy Liu. Before Lucy responds, Logan suffers a stroke that leaves him unable to manage his affairs. Lucy's power to accept the offer ends because the offeror's incapacity has the same terminating effect as death.
Lena Lawson grants her brother Lamar Lewis authority to manage her rental properties. A court later appoints a guardian for Lena after finding her incapable of handling business matters. Lamar's authority terminates during the period of Lena's incapacity just as it would upon her death.
Luis Lopez executes a power of attorney naming his daughter as agent to handle financial decisions. The document states it is durable. When Luis later becomes incapacitated, the agent's authority continues without interruption because the durable designation prevents termination by the principal's incapacity.
Leo Lynch, suffering from advanced dementia, signs a consent form allowing a neighbor to enter his property. The neighbor later enters and damages personal items. Leo's lack of capacity to consent renders the entry an actionable intentional invasion of his interests.
Lamar Lewis fathers a child but suffers incapacity before the child reaches majority. In construing a class gift from a third party, the child is treated as Lamar's child only because Lamar intended to function as a parent and the incapacity intervened to prevent that functioning.
Lucy Liu grants Logan Lane an option to purchase her business. Before Logan exercises the option, Lucy becomes incapacitated. The power of acceptance under the option contract remains intact despite Lucy's incapacity because the option prevents termination by the offeror's incapacity.
A court-ordered conservatorship limits the protected person's authority to incur contractual duties even if the conservatorship is limited rather than plenary. The limitation renders agreements entered during the conservatorship voidable by the conservator.
Mental illness renders a contract voidable if the party cannot understand the nature and consequences of the transaction in a reasonable manner or cannot act reasonably in relation to it when the other party has reason to know of the condition.
Visible intoxication combined with inability to understand the transaction or act reasonably, when the other party has reason to know of the impairment, renders the contract voidable.
A court order declaring a partner incapable of performing partner duties causes dissociation by operation of law without any further action by the remaining partners.
…law a spendthrift was not considered incapable of contracting. Taylor v. Koenigstein , 128 Neb 809, 260 NW 544, 546 (1935). Incapacity of a spendthrift to contract is a disability created by the legislature. California has no such legislation. In addition, the Civil Code of California provides that all persons are capable…