incapacity in nevada

Incapacity in Nevada www.wealth-counselors.com Phone: (775) 823-9455 1

INCAPACITY IN NEVADA

Learn How is Incapacity Defined in Nevada, Why is Determining Incapacity Important and What are the Benefits of Incapacity Planning

BRYCE L. RADER

RENO NEVADA ESTATE PLANNING ATTORNEY

http://www.wealth-counselors.com/estate_planning/index.php/estate-planning/


“Incapacity” has many different meanings depending on the issue being

discussed.

In estate planning, the term capacity means the ability to manage your own

affairs and make important decisions for yourself. Circumstances in our lives,

such as trauma or illness, can lead to incapacity. In some cases, incapacity is

only temporary when the condition causing it has been cured or resolved. In

any case, it is helpful to understand the legal consequences of a determination

of incapacity. That way you can effectively plan for this unfortunate

circumstance should it ever happen to you.

LEGAL INCAPACITY

Capacity is important in many

legal contexts. A person

must be “legally competent”

in order to execute a

contract, will, or other legally

binding document.

Competency does not only

refer to mental capacity, but

also age and maturity. For example, to enter a legally binding contract in most

states, you must have reached the age of majority in your state. In Nevada, the

age of majority is eighteen (18). The reason for this requirement is that

immature individuals need to be protected from liability from a contract when

that individual is presumed to be too inexperienced to understand or negotiate.


In the area of estate planning, legal capacity is a necessity in order to validly

execute estate planning documents.

MENTAL INCAPACITY

Medical conditions, such as psychosis and dementia, are known to lead to

incapacity. Also, substance abuse, hypoxia, brain injuries, dehydration, and

senility can all diminish a person’s ability to make responsible decisions for

themselves. However, a determination of incapacity should never be based

solely on a diagnosis. A medical condition may not presumptively result in a

lack of capacity.

TEMPORARY INCAPACITY

Once the condition or trauma that renders

an individual incapacitated has been

resolved, a person’s capacity may return.

In this case, the incapacity was only

temporary. For instance, intoxication is a

temporary condition that causes incapacity,

which is resolved once the person becomes

sober. Of course, the incompetency of a minor is a temporary condition that

lasts only until the person reaches the age of majority. A medical condition,

such as a coma or a state of unconsciousness is also temporary. Once the

person recovers, his or her ability to make decisions may also return.

The good news is, through

incapacity planning, you can

make choices now while you

are capable of doing so, that

will ensure the person of your

choice is designated to make

decisions for you when you no

longer can.


HOW IS INCAPACITY DEFINED IN NEVADA?

Nevadadefines an incapacitated person as follows:

Incapacitated person means a person who is impaired by reason of mental

illness, mental deficiency, advanced age, disease, weakness of mind or any

other cause except minority, to the extent of lacking sufficient understanding or

capacity to make or communicate responsible decisions.

NV Rev Stat § 132.175 (2013).

WHY IS DETERMINING INCAPACITY IMPORTANT?

It may be necessary to determine incapacity because certain instruments only

become effective when the person who executed the instrument has become

incapacitated. The opposite may also be true; certain estate planning tools are

no longer effective if the person is incapacitated. Determining incapacity can be

a difficult and emotional process. Understanding the process, however, can

make the process more tolerable.

WHO MAKES THE DETERMINATION OF

INCAPACITY?

If a medical determination of incapacity is challenged, it may be necessary for a

legal determination of capacity to be rendered by a court of law. In most cases,

the court requests medical opinions of the experts who examined the individual

in order to judge capacity. In situations where there is no challenge to an

incapacity determination, the court can rely solely on the medical records.


However, if family members contest the finding, the court may request an

independent assessment.

CAN A DETERMINATION OF INCAPACITY BE

REVERSED?

Since incapacity can be temporary, a finding of incapacity can be reversed if the

condition causing the incapacity has been effectively treated. When it is

demonstrated to the court that the person has regained his or her mental

capacity, the determination can be reversed and decision-making abilities

reinstated.

WHAT SHOULD I DO IF I BELIEVE A LOVED ONE

HAS BECOME INCAPACITATED?

Someone who is mentally

impaired may start to show

signs of needing assistance

in their personal affairs,

such as becoming

increasingly forgetful,

disoriented, or unable to

balance a checkbook. If

this happens, you may need to consider whether steps should be taken to care

for their needs and protect them from financial exploitation. In some cases, this

can be done informally by family or friends. However, in most situations more


formal control of a person’saffairs may be required. This may include a

guardianship or the transfer of a trusteeship when a living trust is involved.

A LIVING TRUST IS AN ALTERNATIVE

A Living Trust provides for the appointment of a successor trustee to manage

your estate should you become incapacitated. Most comprehensive estate plans

will also include a durable power of attorney for property and a healthcare

power of attorney. This type of planning is usually much less expensive, time

consuming, and permits you the ability to select who you want to manage your

estate or make medical decisions for you rather than a court controlled process

to appoint and continually monitor your guardian.

THE BENEFITS OF INCAPACITY PLANNING

The good news is, through

incapacity planning, you can

make choices now while you

are capable of doing so, that

will ensure the person of your

choice is designated to make

decisions for you when you no

longer can. Aqualified estate

planning attorney can help you create the comprehensive plan that meets your

needs, while considering the possibility of future incapacity, long term or

terminal illness.


About the Author

Bryce L. Rader

Bryce L. Rader, a shareholder of the law firm, practices primarily in the areas of estate planning, probate, trust administration following death

or disability and long term care planning, including guardianships and other Elder law matters.

With a law degree and a Master of Health Administration from the top health law program in the nation Mr. Rader began his career in public

service with the Nevada State Board of Medical Examiners. While with the Board he dealt with many complex health care issues confronting the state and assisted

in redrawing state health law. Mr. Rader next worked for the Governor’s Office, Consumer Health Assistance. As Deputy Chief Ombudsman he represented the interests of many citizens

before health care providers, state legislators and other state agencies. EDUCATION

Mr. Rader earned a bachelor’s degree in Spanish from the University of Nevada, Reno in 1996. He then went on to earn a law degree from Saint Louis University School of Law and a Master

of Health Administration from the Saint Louis University School of Public Health in 2000. He is a member of the National Academy of Estate Planning Attorneys, the National Academy of

the Elder Law Attorneys, the Academy of Special Needs Planners, the Northern Nevada Estate Planning Council, and the Washoe County Bar Association. He is also member of the Probate and Trust and Elder law sections of the state bar and a founding member of the Washoe

County Probate Bar Association.

PERSONAL As a fourth generation Nevadan Mr. Rader has an intense love for his native state and its surrounding environs. He is an avid outdoorsman who enjoys backpacking and fishing with

his wife and volunteering his time with the Boy Scouts of America.

Anderson, Dorn, & Rader, Ltd.

Legacy and Wealth Planning Attorneys

500 Damonte Ranch Parkway, Suite 860

Reno, NV 89521

Phone: (775) 823-9455

Fax: (775) 823-9456

http://www.wealth-counselors.com/estate_planning/index.php/estate-planning/

http://www.wealth-counselors.com/

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