The Golden Rule

The “Golden Rule” which evolved in the mid 1970’s to protect seniors making Wills. Templeton in Kenward v Adams 1975 can be paraphrased:

In the case of an aged testator or a testator who has suffered a serious illness, there is one golden rule which should also be observed: however straightforward matters may appear and however difficult or tactless it may be to suggest that precautions be taken, the making of a will be such a testator out to be witnessed or approved by a medical practitioner who satisfies himself of the capacity of the testator and records and preserves his examination and finding.
In the last 20 years, the Golden Rule has been used in Great Britain, Canadian and U.S. Common Law in financial dealings with those that are elderly, those who have been sick, and/or seniors who confront complex financial decisions.

A Hierarchy of Capacity Levels
Can an person “appreciate” the implications of a major financial decision? Can she weigh the pros and cons of such a decision, rationally manipulate the options and/or make choices consistent with her long-standing values and preferences? A court or jury may have to determine if a litigant is, or was, competent to make financial decisions. This is why the Golden Rule indicates testing a person’s financial capacity before engaging in making or changing a Will, etc. Fortunately, there is guidance available as the variable standards that are applied from state-to-state are typically grouped into five broad categories:

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The standards are usually expressed in the form of a hierarchy, as shown above. Most simply put, the rigor of the standard applied should correspond to the importance and complexity of the decision.

Undue Influence
Undue influence is a legal concept. This can be due to physical coercion or threats; however, a person with Mild Cognitive Impairment or dementia may be exceptionally susceptible to subversion of his/her will by others. Given one’s cognitive limitations, the legal standard for undue influence can be lower because the more cognitively impaired one is, the less influence needs to be exerted to compromise the elder’s judgment.*

*Shulman, K.I. et al. Assessment of Testamentary Capacity and Vulnerability to Undue Influence. Am J Psychiatry, 2007; 164: 722-727.

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