# Capacity > Concept of capacity Source: https://wiki.powersofattorney.com/capacitytexas · Updated 6 April 2025 > [Capacity refers to **ability to manage one's own affairs**](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) > > [**The Six (6) Greater States have defined incapacity** in legislation](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) > > [**Alternative definitions** of incapacity might be considered](https://wiki.powersofattorney.com/capacitytexas#alternative-definitions-of-incapacity-might-be-considered) > > [Capacity may **arise in different contexts**](https://wiki.powersofattorney.com/capacitytexas#capacity-may-arise-in-different-contexts) > > [Capacity arises in the **context of creation a** ***Power of Attorney***](https://wiki.powersofattorney.com/capacitytexas#capacity-arises-in-the-context-of-creation-a-power-of-attorney) > > [Capacity arises for **consideration after the creation of a** ***Power of Attorney***](https://wiki.powersofattorney.com/capacitytexas#capacity-arises-for-consideration-after-the-creation-of-a-power-of-attorney) > > [**Managing** the issue of **capacity is not an easy task**](https://wiki.powersofattorney.com/capacitytexas#managing-the-issue-of-capacity-is-not-an-easy-task) > > [There are **many potential causes** of incapacity](https://wiki.powersofattorney.com/capacitytexas#there-are-many-potential-causes-of-incapacity) > > [Capacity is of **no relevance to commercial entities**](https://wiki.powersofattorney.com/capacitytexas#capacity-is-a-concept-of-no-relevance-to-commercial-entities) > > [**REFERENCES**](https://wiki.powersofattorney.com/capacitytexas#california) > > - [California](https://wiki.powersofattorney.com/capacitytexas#california) > - [Texas](https://wiki.powersofattorney.com/capacitytexas#texas) > - [New York](https://wiki.powersofattorney.com/capacitytexas#new-york) > - [Florida](https://wiki.powersofattorney.com/capacitytexas#florida) > - [Illinois](https://wiki.powersofattorney.com/capacitytexas#illinois) > - [Pennsylvania](https://wiki.powersofattorney.com/capacitytexas#pennsylvania) ## Capacity Refers To Ability To Manage One's Own Affairs In **California**, a lengthy definition is found in [§811](https://codes.findlaw.com/ca/probate-code/prob-sect-811.html) Mention s.4235, note 1994 report says re 4235 “*Section 4235 is drawn from the Missouri Durable Power of Attorney Law. See Mo. Ann. Stat. § 404.714(4) (Vernon 1990). This section does not provide anything inconsistent with permissible practice under former law, but is intended to recognize the desirability of consultation in appropriate circumstances and provide assurance to third persons that consultation with the attorney-in-fact is proper and does not contravene privacy rights. As to the right to obtain medical records under the durable power of attorney for health care, see Section 4721. See also Section 4455(f) (receipt of bank statements, etc., under statutory form powers of attorney). The right to obtain information may be enforced pursuant to Section 4941(f).”* ### Principal's Loss Of Capacity Often a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney) *Power of Attorney* is said to be a *Power of Attorney* that triggers entitlement of an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to perform tasks if the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) loses [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs), or survive [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney). However, these are merely different designs of a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney) *Power of Attorney*. The notion of "[durability](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney)" should align with the intention of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) as to whether its operation is to survive their loss of [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs). What is important is to give effect to the proposition that the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) may choose to provide that the *Power of Attorney* continues to operate if the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) loses [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs).[^[3]](https://wiki.powersofattorney.com/whatisapoa#fn3) What needs to be avoided is any approach that involves mysterious notions, such as a *Power of Attorney* always [terminating](https://wiki.powersofattorney.com/termmng#termination-refers-to-a-power-of-attorney-coming-to-an-end) upon the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) losing [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs). The difference between these two approaches is that the first approach tends to fundamentally protect and preserve freedom of a [principal's](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) to structure their affairs however they see fit, whereas the second approach tends to limit this freedom. #### Example Imagine a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) wants to say in a *Power of Attorney* that "*at any time between my overseas departure and return dates if I have capacity this agent may perform certain tasks they can do so*" ("**the First Power of Attorney**") and say in another *Power of Attorney* that "*at any time between my overseas departure and return dates if I lack capacity this (possibly other) agent may perform certain tasks*" ("**the Second Power of Attorney**"). #### What The Example Illustrates [Legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) that inhibits the making of arrangements of the kind seen in the Example above, it is problematic. For example:- - [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) in **California** provides that "*the authority of an attorney-in-fact under a nondurable power of attorney is terminated by the incapacity of the principal to contract*" ([§4155](https://codes.findlaw.com/ca/probate-code/prob-sect-4155.html)) resulting in termination of the First *Power of Attorney* if the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) loses [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs), even where the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) prefers otherwise - [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) in **New York** states "*a Power of Attorney terminates when the principal becomes incapacitated, if the Power of Attorney is not durable*" ([§5-1511](https://www.nysenate.gov/legislation/laws/GOB/5-1511)) and "*a Power of Attorney is durable unless it expressly provides that it is terminated by the incapacity of the principal*" ([§5-1501A](https://www.nysenate.gov/legislation/laws/GOB/5-1501A)) also (like in **California**) resulting in termination of the First *Power of Attorney* if the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) loses [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs), even where the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) prefers otherwise There is no reason why [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) should work to prohibit the making of arrangements of the kind seen in the Example. There are excellents reasons for [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) to protect the right of a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) who is a [person](https://wiki.powersofattorney.com/terms#meaning-of-natural-person) to make arrangements of the kind seen in the Example. #### Conclusion The best approach is to accept that:- 1. But for the passing of [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) in the [Six (6) Greater States](https://wiki.powersofattorney.com/introduction#ca-tx-ny-fl-il-and-pa) over the last seventy (70) or so years, it would not be possible to create a *Power of Attorney* that survives [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation)[^[3:1]](https://wiki.powersofattorney.com/whatisapoa#fn3) 2. Each state has chosen to do things in fundamentally different ways[^[4]](https://wiki.powersofattorney.com/whatisapoa#fn4), notwithstanding initiatives for [national reform](https://wiki.powersofattorney.com/historydevbriefhistory#the-national-perspective-is-fluid) 3. It would be preferable if the issues at stake were approached universally with primary consideration given to freedom of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) to structure their *Power of Attorney* affairs however they see fit 4. This is of particular importance given the fundamental, core functions and purposes of a *Power of Attorney*[^[5]](https://wiki.powersofattorney.com/whatisapoa#fn5) 5. Instead, governments have passed [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) that tends to erode the freedom of a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) to structure their affairs as they see fit[^[6]](https://wiki.powersofattorney.com/whatisapoa#fn6) 6. Problems arise in particular, from [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) that refers to [termination](https://wiki.powersofattorney.com/termmng#termination-refers-to-a-power-of-attorney-coming-to-an-end) in the context of *Powers of Attorney* surviving [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney)[^[7]](https://wiki.powersofattorney.com/whatisapoa#fn7) 7. If reference to [termination](https://wiki.powersofattorney.com/termmng#termination-refers-to-a-power-of-attorney-coming-to-an-end) was removed and focus replaced upon the intention of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney), much of the confusion would be solved[^[8]](https://wiki.powersofattorney.com/whatisapoa#fn8) 8. Until this occurs, confusion will prevail because anyone seeking to understand the implications of a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) losing [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) will need to consider a lot of complicated matters[^[9]](https://wiki.powersofattorney.com/whatisapoa#fn9) 9. All of this confusion is capable of being removed by returning the focus back to the intention of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) and the importance of a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) being able to structure their affairs however they see fit Often a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney) *Power of Attorney* is said to be a *Power of Attorney* that triggers entitlement of an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to perform tasks if the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) loses [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs), or survive [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney). However, these are merely different designs of a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney) *Power of Attorney* and what is important, is that in each example the intention of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) is that operation of the the *Power of Attorney* survives their loss of [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs). What is important is to give effect to the proposition that whatever terms the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) sees fit to include in their *Power of Attorney*. For example if the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) wants to say "*at any time between my overseas departure and return dates if I have capacity this agent may perform certain tasks*" they can do so and equally for example, say in another Power of Attorney "*at any time between my overseas departure and return dates if I lack capacity this agent may perform certain tasks*". It is as simple as to say if [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) inhibits this sort of arrangement, the [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) is problematic. There is simply no excuse why [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) should work to prevent these kind of arrangements and excellent reasons for [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) to protect the right of a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) who is a [person](https://wiki.powersofattorney.com/terms#meaning-of-natural-person), given that for example, this is only an ordinary kind of arrangement that many people may prefer to adopt, if they were travelling, or going into hospital or similar. The justification for ensuring these kind of arrangements are feasible is basic human freedom, accepting that at stake is a transaction with over 2500 of history, Any policy kind of argument that arrangements of this kind are complicated in some manner because the [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) is determinative of an [agent's](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) authority are easily dismissed given that, for example: - the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) is at liberty to structure their affairs a different way if they prefer - some states permit [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to certify that the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) has or lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) as applicable - it offends public policy to suggest that complexity should justify limiting the options available to a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) in any manner of that other circumstances prevail (such as the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) lacking [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs)) the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) What is importance in these - a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney) *Power of Attorney* is a kind of *Power of Attorney* that with an operation that survives [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) large number of considerations To understand why the confusion is so substantial, it is necessary to understand the historical contexts of *Power of Attorney*. Until recently, it was generally assumed that It is helpful to approach these matters on the following basis:- a *Power of Attorney* may [terminate](https://wiki.powersofattorney.com/termmng#termination-refers-to-a-power-of-attorney-coming-to-an-end) or become questionable in terms of being reliable in any particular circumstances, unless:- - the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) expresses an intention in their *Power of Attorney* that the *Power of Attorney* continue to operate irrelevant to whether the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) has or lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) and for example, complies with any related statutory obligations; **or** - [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons) relieves the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) of any need to include express an intention that the *Power of Attorney* continue to operate irrelevant to whether the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) has or lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs); **and** - the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) has not expressed any contrary intention in their *Power of Attorney* It is fundamentally helpful to work backwards from a series of simple propositions - the notion of a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney) *Power of Attorney* is a concept that takes into account the intention of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) and terms of relevant [legislation](https://wiki.powersofattorney.com/legislation#the-legislation-governs-powers-of-attorney-for-persons):- - a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney) *Power of Attorney* is not simply a *Power of Attorney* that triggers entitlement of an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to perform tasks if the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) loses [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) to manage relevant affairs - a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney) *Power of Attorney* is not simply a *Power of Attorney* with an operation that survives [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) - a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#durable-powers-of-attorney) *Power of Attorney* is a kind of *Power of Attorney* that with an operation that survives [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) may [terminate](https://wiki.powersofattorney.com/termmng#termination-refers-to-a-power-of-attorney-coming-to-an-end) or become questionable in terms of being reliable in any particular circumstances, unless:- A [person](https://wiki.powersofattorney.com/terms#meaning-of-person-ie-natural-person) who is unable to demonstrate [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) is unable to [create](https://wiki.powersofattorney.com/creation/create#terms-like-create-or-make-a-power-of-attorney-have-various-meanings) a valid and enforceable *Power of Attorney*. If a *Power of Attorney* was [created](https://wiki.powersofattorney.com/creation/create#terms-like-create-or-make-a-power-of-attorney-have-various-meanings) by a [person](https://wiki.powersofattorney.com/terms#meaning-of-person-ie-natural-person) who lacked [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) to [create](https://wiki.powersofattorney.com/creation/create#terms-like-create-or-make-a-power-of-attorney-have-various-meanings) a *Power of Attorney*, a Court may declare the *Power of Attorney* is invalid (i.e. void ab initio, which means ‘as it if never existed’). That said, it would require someone to put the case before the Court and so, there are risks. Terms like ‘has [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs)’, “had [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs)” or “with [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs)” are often used to describe a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) being a person with ability to manage their own affairs relevant to a *Power of Attorney*. Conversely, terms like ‘without [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs)’, ‘lacking [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs)’ or ‘[incapacitated](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation)’ are often used to describe a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) without ability to manage their affairs relevant to a *Power of Attorney.* This approach is oversimplified:- - [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) may be intellectual or physical, including where a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) may be domestically mobile but unable to manage the rigour of attendances associated with managing [commercial](https://wiki.powersofattorney.com/terms#meaning-of-commercial) interests, such as attending on banks, professionals, broader financial institutions, attending to the day-to-day minutiae of managing payments. managing monies in accounts and similar - [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) might focus upon a broad inability to perform any task of a [commercial](https://wiki.powersofattorney.com/terms#meaning-of-commercial) nature or the precise tasks authorized to be performed by [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) under the *Power of Attorney* - [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) may be fluid, changing over time, or constant and unlikely to change, as in the event of permanent [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) ## The Six (6) Greater States Have Defined Incapacity In Legislation All of the [Six (6) Greater States](https://wiki.powersofattorney.com/aboutthiswiki#the-six-6-greater-states-ca-tx-ny-fl-il-and-pa) have a definition of “[incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation)” in their legislation. - in **California**, a lengthy definition is found in [§811](https://codes.findlaw.com/ca/probate-code/prob-sect-811.html) - in **Texas**, legislation refers to a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) being ‘*incapable of managing their financial affairs*’ ([§751.00201](https://codes.findlaw.com/tx/estates-code/est-sect-751-00201.html)) - in **New York**, [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) is defined as: "*ability to comprehend the nature and consequences of the act of executing and granting, revoking, amending or modifying a power of attorney, any provision in a power of attorney, or the authority of any person to act as agent under a power of attorney"* and [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) is defined as “*be without capacity*” ([§1501](https://codes.findlaw.com/ny/general-obligations-law/gob-sect-5-1501.html)) - in **Florida** [§709.2102(7)](https://codes.findlaw.com/fl/title-xl-real-and-personal-property/fl-st-sect-709-2102.html) refers to *“inability of an individual to take those actions necessary to obtain, administer, and dispose of real and personal property, intangible property, business property, benefits, and income”* - in **Illinois**:- - [§2-3](https://codes.findlaw.com/il/chapter-755-estates/il-st-sect-755-45-2-3.html) states: *“the principal is under a legal disability as defined in Section 11a-2 of the Probate Act of 1975. A principal shall also be considered incapacitated if: (i) a physician licensed to practice medicine in all of its branches has examined the principal and has determined that the principal lacks decision making capacity; (ii) that physician has made a written record of this determination and has signed the written record within 90 days after the examination; and (iii) the written record has been delivered to the agent. The agent may rely conclusively on the written record”* - [§11a-2](https://www.ilga.gov/legislation/ilcs/ilcs4.asp?DocName=075500050HArt.+XIa&ActID=2104&ChapterID=60&SeqStart=14300000&SeqEnd=17600000) provides: "*Person with a disability" defined.) "Person with a disability" means a person 18 years or older who (a) because of mental deterioration or physical incapacity is not fully able to manage his person or estate, or (b) is a person with mental illness or a person with a developmental disability and who because of his mental illness or developmental disability is not fully able to manage his person or estate, or (c) because of gambling, idleness, debauchery or excessive use of intoxicants or drugs, so spends or wastes his estate as to expose himself or his family to want or suffering, or (d) is diagnosed with fetal alcohol syndrome or fetal alcohol effects."* - in **Pennsylvania**, [§102](https://codes.findlaw.com/pa/title-20-pacsa-decedents-estates-and-fiduciaries/pa-csa-sect-20-102.html) states “incapacitated person” means a person determined to be an [incapacitated](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) person under the provisions of [Chapter 55](https://law.justia.com/codes/pennsylvania/2016/title-20/chapter-55/) (relating to [incapacitated](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) persons). ## **Alternative Definitions of Incapacity Might Be Considered** A person might consider including an alternative definition of “[incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation)” in a *Power of Attorney*, such as: *“..incapable of managing the affairs that my agent(s) are authorized to perform under this Power of Attorney by virtue of an injury, condition, disease or any other cause (whether known or unknown).”* This definition focuses upon whether [tasks](https://wiki.powersofattorney.com/whatcanagentdo#there-are-lots-of-examples-of-commercial-tasks) relevant to the *Power of Attorney* are able to be performed and does not specify physical or mental disability as a specific cause (although this definition might be expanded to include these concepts) and recognizes a cause may not be identifiable. There may be circumstances where it is suitable to tie the test of [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) to the ability of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) to perform the precise [tasks](https://wiki.powersofattorney.com/whatcanagentdo#there-are-lots-of-examples-of-commercial-tasks) specified in the *Power of Attorney* and other instances where a broader test is more appropriate. ## Capacity May Arise In Different Contexts Whether a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) has or had [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) might arise, for example:- - in respect of the point in time when a *Power of Attorney* was [created](https://wiki.powersofattorney.com/creation/create#there-are-three-methods-to-create-a-power-of-attorney), or - in respect of a point in time or multiple points in time, after a *Power of Attorney* was [created](https://wiki.powersofattorney.com/creation/create#there-are-three-methods-to-create-a-power-of-attorney) ## **Capacity Arises In The Context of Creation a** ***Power of Attorney*** Where [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) at the time when the *Power of Attorney* was [created](https://wiki.powersofattorney.com/creation/create#there-are-three-methods-to-create-a-power-of-attorney) is in dispute, issues include whether at the time that the *Power of Attorney* was created, the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney):- - had sufficient [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) to appreciate their [commercial](https://wiki.powersofattorney.com/terms#meaning-of-commercial) affairs - had sufficient [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) to appreciate their options with respect to the *Power of Attorney* - was capable of properly exercising discretion in designing the *Power of Attorney* - was capable of understanding the implications and effect of signing the *Power of Attorney* ## **Capacity Arises For Consideration After The Creation of A** ***Power of Attorney*** Where [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) is disputed in respect of a point in time after a *Power of Attorney* was [created](https://wiki.powersofattorney.com/creation/create#there-are-three-methods-to-create-a-power-of-attorney), there may be questions as to whether at various points in time the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) had [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs). This seems more likely to occur where for example, a *Power of Attorney* is said to only authorize an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to act when the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) or in California in respect of a [non-durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#non-durable-powers-of-attorney) *Power of Attorney* that terminates upon the the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) losing [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) under [§4155](https://codes.findlaw.com/ca/probate-code/prob-sect-4155.html) ([§4155](https://codes.findlaw.com/ca/probate-code/prob-sect-4155.html) provides “*the authority of an attorney-in-fact under a nondurable power of attorney is terminated by the incapacity of the principal to contract”*). Where a *Power of Attorney* under which the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) is a person is expected to be on foot for some time, there may be considerable purpose in maintaining adequate evidence of [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) over time, to best ensure that any dispute as to the [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) is easy to resolve. ## **Managing The Issue of Capacity Is Not An Easy Task** Involving a lawyer in the preparation and execution of a *Power of Attorney* and ensuring that the lawyer is suitably authorised and instructed to disclose an account of the [principal's](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) presentation at the time it was made is often the most effective means to manage risks associated with a dispute as to whether a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) had [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) at the time a *Power of Attorney* was made. If a dispute arises, a Court would be able to hear and potentially rely upon the lawyer’s evidence about the [principal's](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) presentation at the time that the *Power of Attorney* was signed by the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney). Equally, a lawyer is capable of advising about what steps should be taken to minimize risk of dispute involving questions as to the [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney), such as obtaining suitable medical evidence. One difficult issue that can arise in respect of a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* is deciding whether [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) may either:- - exercise all authority prescribed in their favour under the [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* upon the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) either: (a) losing [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) to perform any single relevant function; or (b) losing [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) to perform more than one relevant function, or perhaps all relevant functions; or - only exercise authority prescribed in their favour under the [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* at any given time to the extent that the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) This issue is difficult because if the [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) or [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) may only exercise authority prescribed in their favour under the [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* at any given time to the extent that the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) it means that:- - as and when every function relevant to the [principal's](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) affairs comes to need to be performed, someone has to decide what [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) has and does not have and of course, that [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) may change from day-to-day; and - beyond that, there is a further question as to who is authorised to decide what [tasks](https://wiki.powersofattorney.com/whatcanagentdo#there-are-lots-of-examples-of-commercial-tasks) the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) can and cannot perform, being a decision that might for example, be made by the [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) or [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) themselves or a physician, or perhaps a person chosen by the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) etc. The difficulties identified above in relation to an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) or [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) only being able to exercise authority to the extent that the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) tend to justify the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) either:- - adopting the alternative approach referred to above, whereby upon the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) losing [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) the [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) or [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) appointed under the [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* may exercise any and all authority prescribed in their favour, particularly given an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) may only exercise authority under a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* for the benefit of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney); or - authorising the [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) or [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) appointed under the [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* to exercise authority whether or not the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs), which removes these issues completely Considerations of this kind may have led to Florida prohibiting a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) from authorizing [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to commence to exercise authority after a future point in time (ie. a prohibiting springing *Powers of Attorney* - see [§709.2108(3)](https://codes.findlaw.com/fl/title-xl-real-and-personal-property/fl-st-sect-709-2108.html)). An individual may want to specify [tasks](https://wiki.powersofattorney.com/whatcanagentdo#there-are-lots-of-examples-of-commercial-tasks) that may be performed by an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) and when an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) may perform those [tasks](https://wiki.powersofattorney.com/whatcanagentdo#there-are-lots-of-examples-of-commercial-tasks), include [tasks](https://wiki.powersofattorney.com/whatcanagentdo#there-are-lots-of-examples-of-commercial-tasks) to be performed only if the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) has [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) and [tasks](https://wiki.powersofattorney.com/whatcanagentdo#there-are-lots-of-examples-of-commercial-tasks) to be performed only if the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) and whether or not the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) lacks [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs). ## There Are Many Potential Causes of Incapacity A person may lose cognitive ability as a consequence of a traumatic event, a condition or disease (ie. dementia, Huntington’s disease etc) or mental illness (ie. schizophrenia, personality disorder etc). [Incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) may also result from a physical condition that renders a person unable to communicate sufficiently to demonstrate that they have cognitive ability (ie quadriplegia, multiple sclerosis, motor neurone disease etc) in which event, even if they have cognitive ability they are [incapacitated](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) in the relevant sense. Traumatic events that might give rise to cognitive and physical [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) (as opposed to diseases and illnesses) include:- - a stroke - work, motor vehicle, household, recreational or other accident - exposure to toxins, poison or chemicals, electrocution or oxygen deprivation - criminal or animal inflicted injury - effects of the ageing process At least in principle, some occupations may involve greater risk of being exposed to a traumatic event than others (oil rig workers, law enforcement and prison workers etc.) Arguably the most difficult issues pertaining to *Powers of Attorney* relate to [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs), partly because it is a fallacy to suggest [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) works in absolutes, such that a person is either incapable or capable. For example, a person may lack capacity, but be far from [incapacitated](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation). When considering a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney*, it is worthwhile to consider empowering [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to exercise authority whether or not you have [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) as opposed to only if you lack [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs), to reduce risks associated with argument about [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs). ## **Capacity Is A Concept Of No Relevance To Commercial Entities** Capacity in the cognitive sense it often applies in the context of *Powers of Attorney* has no relevance to a [commercial entity](https://wiki.powersofattorney.com/terms#meaning-of-commercial-entity), because they are not natural persons. Where a [commercial entity](https://wiki.powersofattorney.com/terms#meaning-of-commercial-entity) seeks to execute a *Power of Attorney*, the concept of ‘[capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs)’ might for example, refer to execution of a *Power of Attorney* being consistent with any relevant *Articles of Association*, partnership agreement, other document or legislation governing the existence of the legal entity. *Articles of Association*, partnership agreement, other documents or legislation may for example, inform as to the entitlement or otherwise of a particular legal entity to create a *Power of Attorney*. ## REFERENCES ### California In **California**, multiple references are made in legislation to [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation), see for example, [§](https://codes.findlaw.com/pa/title-20-pacsa-decedents-estates-and-fiduciaries/pa-csa-sect-20-5604.html)[4120](https://codes.findlaw.com/ca/probate-code/prob-sect-4120.html), [§4124](https://codes.findlaw.com/ca/probate-code/prob-sect-4124.html) and [§4125](https://codes.findlaw.com/ca/probate-code/prob-sect-4125.html)). A lengthy definition is found in [§811](https://codes.findlaw.com/ca/probate-code/prob-sect-811.html). Notably, in California unlike some other US States, part of the [verification process](https://wiki.powersofattorney.com/thirdparty/interests#third-party-rights) available to an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to satisfy a third party of their bona fides includes authority for an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to swear an Affidavit deposing to the lack of [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) on the part of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney), which in turn, may be relied upon by the third party in the context of certain assurances and similar that in effect, protect the third party from any dispute as to whether in fact, the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) did or did not lack [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) at any relevant time. This is potentially significant, although more significant in US States like **Texas** where such authority is not afforded to an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal), leaving open the question as between any [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) and third party as to whether the the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) may or may not lack [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs). Legislation also acknowledges a key concept relevant to [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) stating that “*a temporary incapacity suspends the attorney-in-fact's authority only during the period of the incapacity*”, cognizant of the reality that often, incapacity is transient. ([§4152](https://codes.findlaw.com/ca/probate-code/prob-sect-4152.html)) [Incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) is expressly provided to terminate a [non-durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#non-durable-powers-of-attorney) *Power of Attorney*,[§4155](https://codes.findlaw.com/ca/probate-code/prob-sect-4155.html). ### Texas The concept of [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) with respect to a *Power of Attorney* created by an individual operates differently in various contexts. - In respect of a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney*, the term “[incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation)” is defined in legislation as being ‘incapable of managing their financial affairs’ and unless the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) defines incapacity otherwise, the legislative definition applies ([§751.00201](https://codes.findlaw.com/tx/estates-code/est-sect-751-00201.html)). - In respect of a [non-durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#non-durable-powers-of-attorney-wont-operate-if-the-principal-lacks-capacity) *Power of Attorney*, the absence of express legislation in Texas dealing with [non-durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#non-durable-powers-of-attorney) *Powers of Attorney* means that in practical terms, it is preferable to define what is meant by [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) or [incapacity](https://wiki.powersofattorney.com/capacitytexas#incapacity-refers-to-inability-to-manage-ones-own-affairs) , if the concept is mentioned in the [non-durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#non-durable-powers-of-attorney) *Power of Attorney* It is significant that this definition:- - does not expressly recognise that for example, a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* might be created to authorise an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) or [agents](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to manage only property or legal affairs, as opposed to financial affairs in which event, at least on its face, the definition could not be satisfied for purposes related to the [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney*; and - appears to speaks in absolute terms, as if a person may either be capable of incapable of managing their financial affairs without recognising in particular, that in many cases a person will have a degree of [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs); and - only refers to [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) to manage financial affairs, whereas the purpose of a *Power of Attorney* may include property or financial affairs in addition to financial affairs or potentially, to the exclusion of any financial affairs Notably, unlike **California** where the [verification process](https://wiki.powersofattorney.com/thirdparty/interests#third-party-rights) available to an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to satisfy a third party of their bona fides includes authority for an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) to swear an Affidavit deposing to the lack of [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) on the part of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney), which in turn, may be relied upon by the third party in the context of certain assurances and similar that in effect, protect the third party from any dispute as to whether in fact, the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) did or did not lack [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) at any relevant time, in Texas an [agent](https://wiki.powersofattorney.com/agentswhatisagent#an-agent-is-an-entity-appointed-by-the-principal-to-represent-and-bind-the-principal) cannot depose an Affidavit confirming the lack of capacity of the [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) so as to remove this issue from the scope of any dispute. Cases involving any genuine dispute as to [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) on the part of a [principal](https://wiki.powersofattorney.com/principal#the-principal-is-the-entity-that-makes-the-power-of-attorney) are difficult disputes, often requiring family members and medical experts to give evidence, invariably involving considerable time and expense. ### New York In **New York**, [capacity](https://wiki.powersofattorney.com/capacitytexas#capacity-refers-to-ability-to-manage-ones-own-affairs) is defined as ([§1501](https://codes.findlaw.com/ny/general-obligations-law/gob-sect-5-1501.html)): *“ability to comprehend the nature and consequences of the act of executing and granting, revoking, amending or modifying a power of attorney, any provision in a power of attorney, or the authority of any person to act as agent under a power of attorney."* The term “[incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation)” is defined as “*be without capacity*” {[§1501](https://codes.findlaw.com/ny/general-obligations-law/gob-sect-5-1501.html)). It may be of help to reflect upon [§81.02](https://codes.findlaw.com/ny/mental-hygiene-law/mhy-sect-81-02.html) which defines [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) for guardianship purposes. ### Florida The default statutory definition is ([§709.2102(7)](https://codes.findlaw.com/fl/title-xl-real-and-personal-property/fl-st-sect-709-2102.html)):- *“inability of an individual to take those actions necessary to obtain, administer, and dispose of real and personal property, intangible property, business property, benefits, and income”.* Given that a [durable](https://wiki.powersofattorney.com/typescommonlyusedpersons#a-durable-power-of-attorney-operates-if-the-principal-lacks-or-may-lack-capacity) *Power of Attorney* in Florida must contain certain words or similar words to a set of words that include the word [incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation) and this term is defined in [§709.2102(7)](https://codes.findlaw.com/fl/title-xl-real-and-personal-property/fl-st-sect-709-2102.html), it might be said that where the requisite words are included, the word ‘[incapacity](https://wiki.powersofattorney.com/capacitytexas#the-six-6-greater-states-have-defined-incapacity-in-legislation)’ attracts the definition and another possibility may be that no alternative definition may be preferred. ### Illinois The default statutory definition is ([§2-3](https://codes.findlaw.com/il/chapter-755-estates/il-st-sect-755-45-2-3.html)):- *“the principal is under a legal disability as defined in Section 11a-2 of the Probate Act of 1975. A principal shall also be considered incapacitated if: (i) a physician licensed to practice medicine in all of its branches has examined the principal and has determined that the principal lacks decision making capacity; (ii) that physician has made a written record of this determination and has signed the written record within 90 days after the examination; and (iii) the written record has been delivered to the agent. The agent may rely conclusively on the written record”* The term ‘person with a disability’ is also relied upon legislation (see for example, [§2-6](https://codes.findlaw.com/il/chapter-755-estates/il-st-sect-755-45-2-6.html)) and defined ([§2-3](https://codes.findlaw.com/il/chapter-755-estates/il-st-sect-755-45-2-3.html)). ### Pennsylvania In **Pennsylvania**, [§102](https://codes.findlaw.com/pa/title-20-pacsa-decedents-estates-and-fiduciaries/pa-csa-sect-20-102.html) states:- “Incapacitated person” means a person determined to be an incapacitated person under the provisions of [Chapter 55](https://law.justia.com/codes/pennsylvania/2016/title-20/chapter-55/) (relating to incapacitated persons).