Mental incapacity may take a variety of forms. It may be permanent, as where the defendant is insane, or temporary, as where the defendant was drunk at the time of entering a transaction with the claimant. Whether mental incapacity can operate as a defence to restitutionary claims is something which has received little judicial attention. The leading case on the point is Re Rhodes which, at first sight, might be interpreted as suggesting that such a defence is recognized because the restitutionary claim failed. The defendant was living in a mental asylum and the claimants, who were relatives of the defendant, had paid some of the charges which had arisen. The claimants sought to recover these charges from the defendant on the ground that they were necessaries, but this claim failed. This was not, however, because the defendant was incapacitated, but simply because the claimants were not able to show that they intended to be repaid by the defendant. In other words, the claimants had acted as volunteers. There was nothing in the case to indicate that the claim would otherwise have failed simply because the defendant was incapacitated.
Since the defendant’s minority does not operate as a defence to restitutionary claims, there is no reason why a defence of mental incapacity should be recognized, particularly because both forms of incapacity have a similar function, namely to protect the incapacitated person from the adverse consequences of entering into foolish transactions. Where a mentally incapacitated defendant has received a benefit from the claimant there is no reason why the defendant should retain that benefit simply because of the incapacity. The only significance of the defendant’s incapacity is that, where his or her circumstances have changed since the benefit was received, the defence of change of position may be applied in a more flexible way than it would be if the defendant had full capacity.
-  See p 381, above.
-  An intoxicated defendant who has purchased necessaries and who was incompetent to contract becauseof the intoxication, is required to pay for them: Sale of Goods Act 1979, s 3(2). This provision used to extend tothose who were mentally incapacitated, but this was revoked by the Mental Capacity Act 2005, Sch 6.
-  (1890) 44 Ch D 94.