Who is responsible for the debts of a mentally ill person? Incapacitation and credit


The legal incapacitation is intended to protect persons incapable of making decisions against the legal effects of their actions. However, there will be occasions when they conclude a loan agreement. Who is responsible for the commitment then? What legal consequences must an appointed guardian have to face? We explain.

The problem of liability for a commitment contracted by incapacitated persons is complex. The application of the relevant legal provisions depends on when the loan was taken and whether the contracting party was totally or partially incapacitated. Using the knowledge of experts, we will explain who is responsible for the incapacitated debts, what steps should be taken when signing the contract and what legal consequences this situation implies.

What is incapacitation?

What is incapacitation?

To address the subject of liability for the debts of an incapacitated person, it is necessary to explain what incapacitation is. According to the law, incapacitation is an institution that protects a person who needs help in correctly guiding his decisions, thus protecting him against the potential effects of the actions taken. – Incapacitation also serves the security of trading – to limit the participation of people who are unable to do so. 

At the same time, he adds that a completely incapacitated person cannot independently perform legal acts (e.g. conclude contracts), while a partially incapacitated person has a limited scope as to this – he works with the help and supervision of his legal representative. It should be remembered that the incapacitated person is in no case deprived of legal capacity (subjectivity), which means that he may have his own rights and obligations, including rights and obligations arising from contracts, including credit.

Total and partial incapacitation

Total and partial incapacitation

The type of incapacitation is decided by the court during the procedure for issuing a constitutive decision on incapacitation. In the case of partial incapacitation, a person has limited legal capacity, whereas total incapacitation means a total lack of legal capacity.

The Civil Code indicates the conditions for total and partial incapacitation. The first of the two conditions necessary to issue a decision on total incapacitation is the age of 13 completed by the person subject to incapacitation. The second premise says that as a result of mental illness, mental retardation or other type of mental disorder, in particular drug addiction or drunkenness, such a person is not able to manage his behavior. Unless the incapacitated person completely remains under parental authority, care for them is established. Such a person has no legal capacity. At this point it is worth emphasizing that total incapacitation should serve the protection of the incapacitated person himself. (…) A milder form of incapacitation is partial incapacitation. Pursuant to the provisions of the Civil Code, an adult may be incapacitated partly due to mental illness, mental retardation or other type of mental disorder, in particular drunkenness or drug addiction, if that person’s condition does not justify total incapacitation, but assistance is needed to conduct his affairs. For a legally incapacitated person, a guardianship is established, and a legally incapacitated person has limited legal capacity – explains Lawyer Jovert Nolstalgic from the Magbanua Law Office.

Incapacitation and liability for debts

Incapacitation and liability for debts

The issue of legal incapacitation and the settlement of responsibility for actions taken by such a person requires thorough knowledge of the situation. Therefore, the legal approach to the commitment made by the incapacitated person should be determined in the light of the following situations:

  • taking a loan before the announcement of total incapacitation,
  • taking a loan before the announcement of partial incapacitation,
  • taking a loan by a person totally incapacitated,
  • taking a loan by a partially incapacitated person.

– If the loan was taken before the state of total incapacitation (incapacitation is imposed during the term of the loan agreement), you should think about the state of health of the debtor at the time the contract was incurred and, depending on this, take further action. If the debtor’s health condition excluded his conscious or free decision and will, in particular due to mental illness, mental retardation or other, even temporary, mental disorder, his declaration of will ( conclusion of the contract ) – in accordance with art. 82 of the Civil Code – will be invalid. In such a situation, the legal guardian of the incapacitated person should demand, pursuant to art. 189 of the Code of Civil Proceedings, the court’s annulment of the loan agreement – explains Jovert Nolstalgic.

However, it should be borne in mind that even if the contract is considered invalid, the bank will claim the return of the unduly collected benefit. However, it will be limited to the nominal amount without:

  • contractual interest,
  • contractual penalties
  • and other charges related to the commitment.

In a situation where the debtor enjoyed good health at the time of taking the loan, it will be difficult for him to avoid the negative effects of the previously signed loan agreement.

A different situation is when a contract of commitment is concluded by a totally incapacitated person – according to the law it will be invalid. – If a loan agreement is concluded by a totally incapacitated person who did not act through his or her guardian (or by one of the parents in the situation where he / she remains under parental authority), such legal action will be absolutely null and void. However, if the funds under the loan have already been paid out, then the incapacitated person is obliged to return them as an undue payment. The main part of the debt is refundable, i.e. capital paid out and statutory interest, and the incapacitated person remains an incapacitated person – says Katarzyna Domańska-Moldova, lawyer at BSJP Brockhuis Jurczak Prusak Sp. k.

At the same time, he adds that also in the event of a loan taken out by a totally incapacitated person, for whom an appointed guardian acted, who obtained the consent of the guardianship court for the conclusion of the loan agreement, the liability for loan repayment is borne by the incapacitated person. He is in fact a debtor within the meaning of art. 353 of the Civil Code. As a rule, responsibility will not be borne by the guardian, because he acts only as a statutory representative, unless he takes or uses funds from the loan unlawfully and unlawfully. Then his responsibility will be guilty.

In accordance with the above, the contract concluded by a totally incapacitated person is invalid. However, in the case of a partially incapacitated person, the decision lies with the legal representative, who has the right to confirm it or not. – In the case of a person partially incapacitated for the validity of an obliging legal act, which is taking a loan, the consent of his legal representative is needed, which is the guardian appointed by the guardianship court. (…) At this point, it is worth emphasizing that in the case of contracts (including loan agreements), as opposed to unilateral activities (e.g. declarations of acceptance or rejection of an inheritance), the lack of consent means that the invalidity of contracts is suspended because there is a possibility their subsequent confirmation, while in the case of unilateral actions they are absolutely invalid and there is no possibility of giving consent after their completion – explains Katarzyna Domańska-Moldova.

There is no register of incapacitated persons

There is no register of incapacitated persons

Signing loan or loan agreements can occur even in a situation where the person making the commitment is totally or partially incapacitated. This is possible because there is no register of incapacitated persons in Poland. – The incapacitated persons also have no special documents or anything that would indicate their incapacitation, which is why the bank has practically no possibility to check their legal capacity – says lawyer Agnieszka Grzywka-Kulas from the Law Firm.

Who is responsible for the loan – a bank or a legal representative?

Who is responsible for the loan - a bank or a legal representative?

Due to the fact that the bank is not able to check whether the potential borrower is incapacitated, he is not responsible for the commitment given. The situation is different when the bank representative knew about the incapacitation, and yet it led to its conclusion. In such a case, taking a loan results in damage for the incapacitated person, and the bank’s liability for damages is governed by the general principles.

– The obligation to repay the borrowed amount lies with the person who made the commitment. The legal guardian manages the assets of the incapacitated person and repays the liability incurred. If the loan was taken before incapacitation, but at the date of its conclusion there were doubts as to the consciousness of the person incurring the commitment, you can try to evade such a legal act by requesting the appointment of experts and examining it in terms of the awareness of the contracted commitment – informs Agnieszka Grzywka Scribble.

Loan taken out and what next?

Loan taken out and what next?

The person taking care of the incapacitated person at the time of obtaining information about his incurrence of an obligation should immediately inform the institution which provided it. In addition, the guardian is liable for the repayment of the loan amount as soon as possible, and thus for preventing the squandering person from squandering the funds.

In the case of total incapacitation, the concluded contract is invalid because it was signed by a person who does not have full legal capacity. Despite this, the guardian must notify the bank about the incapacitation, preferably in writing. When it comes to partial incapacitation, the guardian has two options. First, he can agree to its conclusion. Second, inform the bank about the lack of will to confirm it.

– Lack of consent of the legal representative (probation officer – in the case of a partially incapacitated person) to conclude a contract is equivalent to its invalidity. However, wanting such a contract to be valid, the guardian should go to the representative of the other party to the contract and place his signature under the contract. Otherwise, inform the bank in writing about the partial incapacitation of the person signing the contract and the curator’s lack of will to confirm it – explains Jovert Nolstalgic.

At the same time, he emphasizes that regardless of whether the invalid contract was concluded by a totally or partially incapacitated person (in the event that the amount resulting from the contract has already been paid to that person), the person is obliged to return the amount of capital, possibly together with statutory interest. Unless the insolvent debtor (incapacitated person) has no grounds for the termination of the obligation to return the obligation collected without a legal basis (Article 409 of the Civil Code), a possible rescue, i.e. release from the incumbent debt, is submission to the court of a declaration of consumer bankruptcy with the appointment for humanitarian reasons (health status).

It should be borne in mind that there are situations when individual assessment is necessary. As Karolina Świąder points out, such an example is the signing of a loan agreement by a mentally ill but not incapacitated person or by a person who is under legal action for incapacitation. It is then necessary to assess the degree of awareness of the person signing the contract, which may determine the validity or nullity of the contract.

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