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What is decision-making capacity?

Decision-making capacity is your ability to make day-to-day decisions about legal, healthcare, financial and other personal matters.

Key Points:

  • Everyone has the right to make their own decisions and receive support in making them if needed
  • In Australia, there is no uniform standard for capacity and each area of the law has developed a standard that is generally relevant to the situation
  • It is best to have a Will done professionally and witnessed by your doctor

Everyone has decision-making capacity, however, sometimes old age or medical conditions – like dementia, can impact your ability to make clear decisions about your care, finances, or personal life.

In order to have decision-making capacity, you should be able to decide where to live, what to buy, what support or services you need, and when to go to the doctor for yourself.

Similarly, important matters like making a Will or deciding to receive severe medical treatment requires you to have a level of decision-making or legal capacity. 

So what does it mean to have decision-making capacity?

The basics

In Australia, there is no uniform standard for capacity but you can have different levels of capacity depending on the decision you are trying to make. 

For example, the test for mental capacity to make a Will is different from the test for capacity to make a medical decision. These tests can also vary in each State and Territory.

Everyone has the right to make their own decisions or, if needed, the right to have support to make their own decisions. 

In some situations though, this right must be balanced with the need to protect a person who cannot make a particular decision from harm to themselves or from exploitation by others.

The law and different legal tests can determine your decision-making capacity status for different legal circumstances. 

For you to be considered to have decision-making capacity, you need to meet some criteria.

You must be able to:

  • Understand the facts involved in making a decision
  • Weigh up choices and consequences
  • Communicate your decision in some way

To have impaired decision-making capacity, you are unable to:

  • Understand the information provided and the choices available to you
  • Make a decision based on this information 
  • Understand the consequences of decisions
  • Retain the information, even if for a short time
  • Communicate your decision in some way

In some cases, even if you have impaired decision-making capacity, you can still receive assistance from family and friends to make supported decisions.

Depending on your results, decision-making arrangements may be put in place.

Assessing your decision-making abilities

Capacity is decision-specific and depends on the decision being made.

Your decision-making capacity can fluctuate depending on many environmental factors, such as the time of day, location, noise, or who is present. 

Your capacity may also be affected by anxiety or heightened stress levels, some medication, drugs or alcohol.

If you have a disability or medical condition, that doesn’t automatically mean that you do not have decision-making capacity. 

For example, if you are diagnosed with dementia, you still may be able to make your own decisions. 

Also, just because someone may disagree with your decision, that does not mean you lack decision-making capacity.

Making a Will

A Will is a legal document that sets out what you would like to happen to your assets when you die.

A Will also covers other details including who will look after your dependant children, what your wishes are for your funeral and who you would like to name as executor.

Making a Will allows you to express exactly how you would like your assets distributed amongst your family and friends, rather than letting the law decide for you.

You must have the mental capacity or testamentary capacity to know what you are doing to make a Will and must have a full understanding of the distribution of your property when you die. 

A court or tribunal may limit your Will-making capacity where a protection order is made under the Aged and Infirm Persons Property Act, or where directions are made in relation to a protected person under the Guardianship and Administration Act. Legislation in these Acts can differ depending on what State or Territory you live in.

Care must be taken if your mental capacity is questioned as your Will may be subject to a challenge after you die. 

In this case, it is wise to have the Will prepared professionally and to have it witnessed by your doctor who could testify about your mental capacity at a later date.

You can learn more about Wills in our article, ‘Do I really need a Will and last testament?

Voluntary Assisted Dying

In Australia, laws that legalise voluntary assisted dying (VAD) have been passed in all states.

VAD is the assistance provided to a person by a health practitioner to end their life if they have a terminal illness. 

You must have decision-making capacity to decide to access VAD but in some cases, additional specialist opinions may be needed to determine if you are eligible for VAD if your capacity is unclear. 

There are offences for anyone, including medical professionals, who convinces another person to request VAD or take VAD medication.

Read more about voluntary assisted dying in our article, ‘Voluntary assisted dying laws in Australia explained’.

In what instances has your decision-making capacity been tested? Let us know in the comments below. 

Related content:

Organising legal matters when living with dementia
Communication difficulties: Still getting your point across
Voluntary assisted dying laws in Australia explained
Keeping your brain healthy as you age


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