The legal meaning of capacity, put simply, is a person’s ability to enter into binding agreements (like contracts) or make other legal decisions (eg. deciding to sue someone or a company).
As a general proposition, if you are over the age of 18, you have the capacity to make legal decisions. These decisions can be obviously legal in nature (like commencing legal proceedings or entering into a contract) or less obviously legal, like getting married or opening a bank account.
Whilst capacity is important, many people will have legal capacity but still have trouble understanding legal processes and the work that we do for them. We see our role as lawyers and advocates as not only making sure that we get great outcomes for our clients’ disability insurance claims (TPD, income protection, trauma insurance etc.) but also making sure that we explain (and our clients understand) the work that we are doing for them.
When is capacity important when you engage a lawyer?
When acting for you and taking your instructions on your insurance claim, your lawyer is entitled to assume that you have legal capacity unless circumstances arise or are present that suggest that you may not.
Those circumstances may be:
- the diagnosis of an illness which impacts on your cognitive capacity (your ability to think and understand)- ie. dementia, Alzheimer’s, mental health, drug use or addiction;
- difficulties understanding verbal English;
- difficulties understanding written English;
- intellectual disability; and
- many others.
Importantly, the test relates to your capacity to understand the consequences of your decisions, and lawyers are not allowed to impose their own values and judgements onto your decisions
Why is capacity and understanding important to us?
Firstly, there are serious legal consequences for us if we take instructions from you and you do not have legal capacity to understand those decisions. However, perhaps most importantly, we strive to ensure that our clients understand the work we are doing for them and are up to date with the progress we are making on their claims.
In our work, the issue of capacity can be very complex and making sure our clients understand what we are telling them or doing for them can require some additional work. We see this as an important part of our job, and we use a number of techniques to make sure that our clients understand the work that we are doing for them.
The considerations are twofold. We must make sure:
- that you are cognitively able to understand the implications of work we are doing (you have capacity); and
- importantly, we carefully explain the work we are doing for you in a way that you understand.
What is our approach to making sure our clients understand the legal process?
We understand that each of our clients has different factors which decide their ability to understand the work we are doing. For example, some people:
- are first-time users of a legal service and have a limited understanding of legal jargon and processes and need us to explain things in different ways compared to others who may have had more experience with the legal system.
- suffer from illnesses which impact on cognitive capacity (i.e. a brain injury) and require us to explain things in different ways (e.g. in writing or face to face, not via telephone) to ensure that they understand the work that we are doing. Importantly, these clients have capacity but need us to work with them in varied ways to help them understand.
Therefore, in addition to being available to speak to you over the phone or in person (we can even arrange home visits), we will also always write to you regularly to keep you updated about what is happening on your claim(s).
We also understand that the language we use to explain the work we are doing is very important, and we always use the most accessible language that we can and are prepared to explain things multiple times in different ways to make sure that our clients are kept informed.
How do we work to make sure our clients have understood what we are doing?
No matter what your background, age, ethnicity, illness/injury or English language competency, we are always open to speaking to your support people (family or friends or NDIS/social workers) about your claim and keeping you and others updated about your claim.
We have a practice of always asking you from the outset if there is a person in your life that you would like us to list on your file as an Alternative Contact (someone that we can call if we lose contact with you) or if you would like someone else to be our day-to-day contact on your client.
We only list these people on your file and contact them with your consent, but it is one important way that we help you to understand the work we are doing for you. Also, we will speak to and take instructions on your claim from people that you have formally nominated to help, e.g., a Power of Attorney.
When is it most important that we make sure that you have capacity and that you understand?
We are obviously most tuned into capacity and making sure you understand when the nature of your illness is associated with capacity issues (for example, Alzheimer’s Disease or Schizophrenia and other similar illnesses). If circumstances exist that suggest to us that you:
- are likely to develop capacity issues;
- are having temporary issues understanding the work we are doing; and/or
- have lost capacity,
our first step is usually a frank conversation with you or those that are nearest and dearest to you (including your doctors). After this, we may take more formal steps to put in place safeguards around capacity, like suggesting that you nominate someone in an official capacity to help you with your claim. Doctors are always an important part of the work we do on TPD and other insurance claims, but they become particularly important when issues of capacity arise.
Get help from a disability insurance lawyer
If you’re considering a disability insurance claim like a TPD claim, income protection or trauma insurance claim, and you’re concerned about understanding the legal process, a great option is to take advantage of our free advice line. We can talk to you in language that you understand. We won’t rush you, and we’re always happy to explain concepts again if something isn’t clear.
It’s 100% free to find out where you stand, and we also offer ‘no win no fee’ on disability insurance claims. We’re determined to make that initial call and any ongoing work for you as clear and simple as possible, and we aim to remove the stress and frustration of going through the claims processes.
Contacting Berrill & Watson
📞 Melbourne: 03 9448 8048
📞 Brisbane: 07 3013 4300
📞 Anywhere else in Australia: 03 9448 8048
How we charge
We are Australia's best-value superannuation/insurance law firm. Other law firms charge nearly double (& sometimes more than double) what we charge. So, if you get a quote from them, or have a cost agreement, ask us what we will charge you.