"Better late than never" is an old English saying means it is better for someone to arrive or do something late than to never arrive or do it at all. With estate planning, this can ring very true, but a more accurate statement would be that it is better for someone to engage in estate planning late than never, so long as they retain the requisite capacity to do so. In reality, it can be too late to execute certain estate planning documents because a certain level of testamentary capacity is required to sign estate planning documents.
Testamentary capacity is the required mental capacity required to execute estate planning documents. Generally speaking, capacity has multiple requirements:
1. The signor must show that he or she understands the purpose of the document and the statements made within it.
2. The signor understands the extent and nature of the property being distributed or affected by the document.
3. The signor knows the names and identities of the people named in the document.
4. The signor knows who makes up his or her family and can appreciate their relation.
If a document is signed by an individual without these requirements, the document is no good and any actions taken under its authority are null and void. A claim alleging that the signor of a document does not have capacity calls into question the legitimacy of the entire document.
Many elements of an estate plan can only be put in place if the signor has the requisite capacity. Therefore, it can truly be too late to sign and/or set up your estate plan. It is a good idea to ensure you have your documents signed and in place.