Identifying Elderly Client Competency

by Frank Dickens ABR, SRES, SFR, SRS and Nikki Salgat, Esq.

The elderly population is on the rise. Currently, almost 13 percent of the population is age 71 to 92 and 1.5 percent is over 92 years old. With this increase in growth, real estate practitioners today are finding that many transactions involve senior citizens.

Consequently, real estate professionals may find themselves in a situation where they suspect competency issues or even elder abuse.

First and foremost, it is not up to agents to determine whether someone is competent or if abuse exists. In fact, it is beyond our scope of expertise. However, when we spot problematic signs, it may be up to us as professionals to refer family members or the elder to helpful resources.

Part One: Competency*
According to the Mayo Clinic, Alzheimer’s disease is the most common cause of dementia in people age 65 and older. As such, if your client is over the age of 65 there is a possibility that competency issues may arise. As the real estate professional, you may recognize some of the following signs that present themselves when cognitive issues are present.

Signs of incompetency:

  • Cognitive changes
    • Memory loss
    • Difficulty communicating or finding words
    • Difficulty reasoning or problem-solving
    • Difficulty handling complex tasks
    • Difficulty with planning and organizing
    • Difficulty with coordination and motor functions
    • Confusion and disorientation
  • Psychological changes
    • Personality changes
    • Depression
    • Anxiety
    • Inappropriate behavior
    • Paranoia
    • Agitation
    • Hallucinations

The legal concept of competency generally considers whether a person has the mental capacity to decide in accordance with their goals, concerns and values. If you have an elderly client that displays any of the above signs, you may run into competency issues. If that is the case, you should enlist the help of family members who, in turn, can seek assistance from a health care professional and/or an elder law attorney.

If these options are unavailable, it may prove beneficial to put the elderly client in touch with the Arizona Department of Economic Security – Aging and Disability Services Division (ADS). ADS serves to protect the rights of older adults and provides information and assistance on rights, benefits and options.

Additionally, every county in Arizona has a local agency on aging designed to provide services, offer information and advocate for older adults.

You may also want to consider asking your client if they have executed a Power of Attorney (POA). A POA is a legal document that gives another adult the authority to act on that person’s behalf. In other words, a POA assigns a person(s) to step into another person’s shoes and make legal decisions in the same way that they would.

The following are different types of POAs:

  1. General – permits the person to do any legal act on behalf of the grantor
  2. Specific/Special – gives limited authority to only perform certain acts such as a one-time business transaction or a specific sale of real or personal property
  3. Durable – extends the duration of the agent’s authority in the event of mental incompetence at the time the POA expires, rendering the POA legally enforceable until mental competency is regained
    1. POA can be effective immediately; or
    2. Springing – POA only becomes effective when the grantor becomes disabled or incapacitated
  4. Health Care – gives another person authority over the grantor’s health care decisions

Significantly, Arizona law provides that if the person with POA is directed to transfer real property, the POA must be recorded. The POA does not have to be recorded immediately, but will need to be recorded at the time of the transaction. See A.R.S. §§ 33-411 through 33-423.

*Part Two: Abuse (Feb. 10, 2017)

For more information on the prevention of abuse and neglect, visit the Area Agency on Aging, Region One (Maricopa County) and watch Window to the Law: Prevent Elder Abuse (video).

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