The Citizens Advice Bureau has been lobbying Government, ahead of a vote on amendments to the Mental Capacity Bill, regarding greater legal rights for mentally ill people who apply for financial services products. This follows a case of a man from the northeast, who had taken loans out with a high street, while an inpatient at a psychiatric hospital, which he gave as his home address. Despite the hospital confirming that he was incapable of understanding the agreement, the bank refused to write off his debt.
The amendments to the bill would give people the right to cancel agreements when there was clear that the evidence had not been understood because of the persons' mental capacity.
Our view
To us this is simple. It is much the same as minors, i.e. children. Contracts cannot be enforced on minors. Therefore, you find that most will not offer contracts to children. If somebody is mentally incapacitated, you cannot expect them to understand contract.
If a contract is to be entered into, it should be via an Enduring Power of Attorney or via the Court of Protection.
Read our section of Powers of Attorney.