Saulle v Nouvet

Capacity in civil proceedings is decision-specific and time-specific. Under CPR Part 21, the High Court must use the statutory definition of capacity imported from the Mental Capacity Act 2005, although the jurisdiction and questions arise from the Rules rather than the Act. The court must identify the decisions presently required, consider whether the person can make them with appropriate explanation and support, and avoid forecasting incapacity in possible future circumstances. The statutory assumption of capacity is displaced only on the balance of probabilities. An unwise decision does not itself establish incapacity. Where practicable support enables the person to understand and weigh relevant information, the person may retain capacity. A person who can manage the current litigation is not a protected party merely because impairment may cause incapacity for a different decision or at a later time.

The claimant suffered severe traumatic brain injury in a road traffic accident and brought a substantial damages claim. Judgment had been entered by consent, but issues concerning contributory negligence and the assessment or compromise of damages remained. A preliminary issue was directed concerning his capacity to conduct the litigation and manage money recovered in it. His sister had been appointed litigation friend without a prior formal finding of incapacity.

The court considered the effect of the recently commenced Mental Capacity Act 2005, CPR Part 21 and the related Practice Direction. The central questions were whether the claimant was a protected party and, if so, whether he was a protected beneficiary.

1. Applicable framework. The claimant was not a protected party. CPR Part 21 created the questions whether he lacked capacity to conduct the proceedings and, consequentially, whether he lacked capacity to manage and control money recovered in them. The statutory definition was imported by the Rules, not directly imposed by the Mental Capacity Act 2005. The Rules also provided the procedural route for court approval, directions concerning recovered money and, in appropriate cases, involvement of the Court of Protection.
2. Legal test. The court applied the common-law test stated in Masterman-Lister v Brutton & Co [2003] 1 WLR 1511: whether the party can understand, with proper explanation from legal advisers and other experts as necessary, the issues on which consent or decision is likely to be required. This test is substantially consistent with sections 2 and 3 of the Act. Capacity had to be assessed in relation to the decisions arising in the litigation at the present time, rather than by reference to possible future decisions.
3. Statutory principles. The assumption of capacity could be displaced only by proof on the balance of probabilities. The court had to consider whether all practicable steps had been taken to assist the claimant, including explanations adapted to his circumstances. Capacity could not be denied merely because a decision was unwise. Support from family, medical professionals and the legal team was relevant where it enabled him to understand and make decisions.
4. Application. The claimant had significant cognitive impairment, memory problems and variable mental states. At times he became irrational and aggressive and might then lack capacity for an important decision. But the evidence showed that he could make decisions during better periods, obtain advice, manage money on extended holidays and take prudent financial steps. No important decision had been shown to have been made while he was in an impaired state. His support network enabled him to wait, receive explanations and focus on the relevant decision. The evidence therefore did not displace the assumption of capacity.
5. Official Solicitor and future protection. Following Lindsay v Wood [2006] EWHC 2895 (QB), consideration of involving the Official Solicitor was appropriate in a case with forensic imbalance, but no general rule required involvement. The evidence and advocacy were sufficient here. The court noted, without deciding, that periodical payments, provisional damages or provision for professional advice might offer protection if circumstances changed.
6. The claimant was not a protected party. It was therefore unnecessary to determine whether he was a protected beneficiary, and his litigation friend’s appointment would require an order under CPR 21(9)(2).

First-instance determination of a preliminary capacity issue in an ongoing damages claim. No appellate history was stated in the judgment.