Understanding Legal Capacity: Why Wills, Powers of Attorney, and Trusts Require Different Levels of Capacity
When someone creates an estate plan, one of the most important — and often overlooked — legal requirements is capacity. Before an estate planning attorney can draft a Will, Power of Attorney, or Trust, they must determine whether the client has the mental ability to understand what they are signing.
This is not simply best practice. In California, capacity affects whether a document is valid. If someone signs a document without the required capacity, their estate plan may later be challenged by spouses, siblings, or children — potentially causing expensive litigation and family conflict.
Below is a clear breakdown of the three most common estate planning documents and the different levels of capacity required for each.
⭐ 1. Capacity Required for a Will (Testamentary Capacity)
This is the lowest legal threshold of capacity.
To create a valid Will in California, the person (the “testator”) must meet the standard for testamentary capacity, defined in California Probate Code Section 6100.5 which means they understand:
- That they are creating a Will
- The nature and extent of their property (in general terms — not exact numbers)
- Who their natural heirs are (such as spouse, children, or other close family)
- How the Will distributes their property
A person can have mild dementia and still have testamentary capacity as long as they meet the above elements.
✔ Real Example: Mild Alzheimer’s but Still Able to Create a Will
An 82-year-old man with early-stage Alzheimer’s came to an estate planning attorney wanting to leave his estate equally to his children.
- He knew he owned a home and two bank accounts
- He knew who his children were
- He clearly expressed his wishes
- He could discuss how the Will works
Even though his short-term memory was poor, he met the legal standard, and his Will was valid.
⭐ 2. Capacity Required for Powers of Attorney (Higher Standard)
Financial and healthcare powers of attorney require a higher level of decision-making ability.
The client must understand:
- What a Power of Attorney is
- What powers they are giving to another person
- The consequences of granting those powers
- How the agent can act on their behalf
This requires more reasoning and comprehension than a Will.
✔ Real Example: When a Power of Attorney Was Denied
A woman with progressing dementia wanted to sign a Financial Power of Attorney naming her son. When asked:
- She could not explain what powers her son would have
- She did not understand he could access her bank accounts
- She thought the document was “just for emergencies,” but couldn’t explain what that meant
Because she could not understand the scope of authority, the attorney ethically refused to proceed. This protected her — and also prevented the son and siblings from later accusing the firm of enabling elder financial abuse.
⭐ 3. Capacity Required for a Trust (Often the Highest Standard)
Creating a Revocable Living Trust generally requires contractual capacity (Probate Code Section 812), which is a higher standard than making a Will. This is required because a Trust involves ongoing fiduciary duties and asset transfers, which courts view as more complex than a simple testamentary act.
The client must be able to:
- Understand the rights and responsibilities involved
- Understand the effect of signing
- Appreciate the risks, benefits, and alternatives
- Make rational decisions based on that understanding
A Trust is more complex than a Will — it involves ongoing management, asset transfers, and long-term responsibilities.
✔ Real Example: Siblings Challenging a Trust
A man in his late 70s created a Trust leaving most assets to his second wife. Months later, his adult children challenged the Trust in court, arguing:
- He had been hospitalized for confusion the week before signing
- He could not understand the terms of the Trust
- He could not explain who would manage the Trust after his death
The court reviewed medical records and attorney notes. Because the attorney had documented concerns and paused the signing until the client was lucid, the Trust survived the challenge. If the attorney had ignored capacity issues, the Trust could have been invalidated.
🧠 Why Estate Planning Attorneys Must Evaluate Capacity
Estate planning attorneys have both an ethical and legal duty to ensure that a client:
- Understands what they are signing
- Can communicate decisions voluntarily
- Is not being unduly influenced
- Is not affected by dementia, severe depression, medication effects, or cognitive impairment
This protects the client, the integrity of the documents, and the attorney.
Some ways attorneys assess capacity:
- Asking open-ended questions (“Tell me in your own words…”)
- Noting memory lapses or confusion
- Reviewing recent medical history if appropriate
- Conducting the meeting privately (without family present)
- Documenting observations thoroughly
- Rescheduling if the client is tired, medicated, or having a confused day
A few minutes of careful evaluation can prevent years of costly litigation.
⚠️ What Happens When Capacity Is Doubtful?
If capacity is questionable, attorneys may:
- Delay signing until a “good day”
- Request a medical evaluation
- Use simplified documents if appropriate
- Decline representation if the client cannot meet the required capacity. This is often necessary to protect the client's interests and prevent future accusations of elder financial abuse against the attorney or the client’s family.
Conclusion
Different estate planning documents require different levels of mental capacity.
- Wills: lowest threshold
- Powers of Attorney: higher
- Trusts: usually highest
A responsible estate planning attorney must carefully evaluate capacity before moving forward. Doing so protects the client, reduces the risk of future challenges, and ensures that the client’s wishes are honored exactly as intended.