Mental capacitySeveral years ago, perhaps around 2005, there was an elderly woman I met (at my dad’s retirement community in San Jose) who wanted to hire me to list her Santa Clara house for sale.  She was a nice lady, very kind, but mentally, she seemed to “come and go”.  One moment she appeared lucid and could comprehend our conversation.  A few moments later, her mind seemed to be gone.  She was suffering from dementia and it came and went like a fast moving tide.

What to do in a case like this?  I could not take her listing with her signing the paperwork because I knew that she did not have the mental capacity – at least not consistently – to understand what she was signing. (One cannot legally enter into a contract if the mental capacity is lacking.)   As much as I had wanted to list and sell her home, I could not do it if she was to be the one signing the contract.

I spoke with her adult son, and I explained my concerns. I suggested that he obtain a power of attorney so that he could sell the property for his mother and provide for her best interests regarding the real estate transaction.   He expressed to me that he wanted his mother to be in charge, to feel that she was in control.  When I reviewed with him my experience, and explained that I felt that she lacked the mental capacity to enter into a contract, he stunned me by replying “that’s what the other Realtor told us, too”.  They had met with another agent who was equally uncomfortable getting this home owner’s signature on the paperwork.  That should have told them something!

Sadly, the grown son would not agree to working as his mom’s signer with a power of attorney. He insisted that if they hire me, she do all of the paperwork. I knew that this would be a disaster on every level.

So I had to bow out.  I don’t know how many other real estate licensees they talked with before finding someone here in Silicon Valley who would list the house, but I am hoping that each Realtor said the same thing so that they didn’t put this poor woman in the position of having to deal with the contracts, disclosures, and other paperwork which would no doubt agitate and confuse her further.

It’s a tricky thing when our elderly relatives need to sell a beloved home or investment property but aren’t mentally sharp any more.  For their own protection, it is best if they can allow someone trusted – ideally a close family member – to take the reigns on the home sale.  If a real estate agent or broker suggests to you or to your family that perhaps someone else should be signing the paperwork, there’s a good chance that this is something to be investigated a little more.  Talk with other Realtors or brokers. Speak with a good real estate attorney.  Real estate licensees seldom ask for family support regarding signatures, but if they do, please take it seriously – it is most likely in your loved one’s best interest.


For further reading:

Can home sellers back out of the contract or force a buyer out?

What is a seller contingency?