Key Considerations:

1. Mental Capacity in Real Estate:

   • In Alberta, a client must have the legal capacity to understand the nature and consequences of signing a real estate contract. This includes comprehending the terms of the agreement and making informed decisions.

2. When a Client Shows Signs of Cognitive Impairment:

   • If a client appears confused, forgetful, or struggles to follow discussions, it raises concerns about their capacity to contract.

   • Do not make assumptions about their ability to sign — mental capacity can fluctuate, and only a medical professional can formally assess it.

Scenarios and Actions:

1. When Both Spouses Are Present and One Has Alzheimer’s:

   • Lucid Intervals: If the spouse with Alzheimer's appears lucid, you may proceed cautiously, but make clear notes about their mental state during the interaction.

   • If Doubts Arise: Explain that, to protect all parties, you may need confirmation of their capacity. Suggest obtaining a doctor's note or legal confirmation without directly accusing them of incapacity.

2. When the Client with Alzheimer’s Is Alone:

   • Direct but Respectful Approach: If you have concerns about their capacity to sign contracts, pause the process. Explain that real estate transactions require clear understanding and suggest they involve a family member, lawyer, or appointed representative.

   • Power of Attorney (POA): Ask if there is a POA in place. If so, request a copy to verify the appointed person has the authority to sign on their behalf. This would have been signed prior to incapacity.

3. If a Client’s Spouse Claims They Are Lucid Enough to Sign:

   • While the spouse's input is valuable, the final determination of capacity is not theirs to make. You must use your professional judgment and, if needed, recommend seeking legal or medical confirmation.

Practical Steps for Realtors:

1. Documentation:

   • Keep detailed notes of your observations and conversations, including dates, times, and who was present.

   • If you have any doubts about capacity, document your concerns and the steps you took to address them.

2. Seek Legal Guidance:

   • If you’re uncertain about a client’s capacity, advise them to seek independent legal advice before proceeding.

3. Referral to a Lawyer or POA:

   • Encourage the client to involve their lawyer or family member. Ensure any POA documents are reviewed for proper authority.

4. Protect All Parties:

   • Your role is not to diagnose but to ensure contracts are signed by clients who fully understand them. When in doubt, pause and seek appropriate support.

Conclusion: Your duty as a realtor is to act in the best interest of your clients while upholding legal and ethical standards. When Alzheimer’s or cognitive impairment is a factor, proceed with care, document thoroughly, and when in doubt, involve legal professionals to ensure transactions are valid and secure.

Scenario

February 27, 2025

to Agent XXXXX

I am concerned how this has been handled,  if the spouse has Alzheimer’s, there should be medical documentation confirming the diagnosis. It’s concerning how you initially said one thing but then backtracked, especially when it comes to something as serious as mental capacity and legal consent.

To ensure everything is handled correctly, we want to confirm that both sellers fully understand and consent to the listing and sale. If there are any concerns about mental capacity, it’s best we address them now to protect everyone involved. Ask would they be open to providing a doctor’s note or having your lawyer confirm there are no capacity issues?  

• If there’s hesitation or conflicting stories, gently suggest the sellers speak with their lawyer.

• If the spouse truly has Alzheimer’s and cannot legally sign, the realtor must confirm if there’s a Power of Attorney (POA) in place (signed prior to having capacity issues, or when signed, she was lucid. normally a lawyer can take this on.  If not, the sale cannot proceed without proper legal steps.

Document every interaction — dates, times, and what was discussed — in case the situation escalates or legal questions arise later.  

I want to make it clear that under no circumstances should you allow the spouse with cognitive impairment to sign any contracts if their capacity is in doubt. Signing as a remote signer in this instance will not suffice. 

If you feel this is not feeling right,  pause everything and loop me in immediately. We can discuss whether legal counsel needs to step in. Based on your first findings, now by a third party, I already suggested a medical note and to discuss with a lawyer. If this is no longer so, then move forward as directed above. 

After this discussion with our agent, he stepped it up and had the family become involved, this satisfied the brokerage for capacity concerns:

Hi Sandra,

AgentXXXX brought to my attention a concern around my mom's signing authority. 

While it is true that my mom was hospitalized in January and doctors noted some acute confusion, which is now being controlled with medication, I confirm my mom has not been declared incapacitated nor does she have a diagnosis which would prevent her from signing any legal documents. I am a named agent under her Personal Directive and I confirm we have not enacted it as we specifically met with the social worker in hospital about when a capacity assessment may be warranted and if enduring power of attorney may be required and based on the medical assessment in hospital they told us no, we are not at that stage and in fact my mom has improved since being discharged. 

As my mom's designated agent, I am comfortable stating the she understands and is capable of signing to sell the house.