Ortelere v. Teachers’ Retirement Board of New York case brief

Ortelere v. Teachers’ Retirement Board of New York case brief summary
250 N.E.2d 460 (1969)

CASE SYNOPSIS

Appeal from an order of the Appellate Division of the Supreme Court in the First Judicial Department (New York), reversing the judgment of the trial court in favor of plaintiff and dismissing the complaint in which revocation of an election of retirement benefits on the basis of capacity was sought.

CASE FACTS
Plaintiff appealed after the reviewing court reversed the trial court's decision in favor of plaintiff, and dismissed the complaint seeking revocation of plaintiff's decedent's election of benefits under a public employees' retirement system. The decedent, mentally ill, died a little less than two months after making her election of maximum benefits, thus causing the entire reserve to fall in.

DISCUSSION

• The instant court reversed, stating that incapacity to contract or exercise contractual rights could exist despite the intellectual or cognitive ability to understand. 
• Contracts of a mentally incompetent person who had not been adjudicated insane were voidable. 
• Even where the contract had been partly or fully performed it would still be avoided upon restoration of the status quo. 
• However, there should be relief only if the other party knew or was put on notice as to the contractor's mental illness.

CONCLUSION
Reversed, because incapacity to contract or exercise contractual rights could exist despite the intellectual or cognitive ability to understand, and the other party knew or was put on notice as to the contractor's mental illness.


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