Ortelere v. Teachers' Retirement Board

25 N.Y. 2d 196, 250 N.E.2d 460 (1969)

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Nature of the Case

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Facts

Mrs. Ortelere suffered a nervous breakdown and was diagnosed as having involutional psychosis, melancholia psychosis, and the possible existence of cerebral arteriosclerosis. These conditions rendered her unable to act rationally or to make decisions. She decided to retire shortly after she became ill. She requested information about her teacher retirement fund options, then changed her payment option from one granting unexpended benefits to be paid to her husband to one granting her maximum benefits during life with nothing being due after her death. She borrowed the maximum amount from the fund and then died two months later. Her husband (P) of 38 years had quit his job to care for her. After she died, P offered to return the loan proceeds to the retirement system and made a request to reinstate the original option chosen. The Teachers' Retirement Board (D) refused. P sued D to void the contract under mental incapacity. Dr. D'Angelo testified '[at] no time since she was under my care was she ever mentally competent'; that '[mentally] she couldn't make a decision of any kind, actually, of any kind, small or large.' He also described how involutional melancholia affects the judgment process: 'They can't think rationally, no matter what the situation is. They will even tell you, 'I used to be able to think of anything and make any decision. Now,' they say, 'even getting up, I don't know whether I should get up or whether I should stay in bed.' Or, 'I don't even know how to make a slice of toast anymore.' Everything is impossible to decide, and everything is too great an effort to even think of doing. They just don't have the effort, actually, because their nervous breakdown drains them of all their physical energies.' The trial court found for P and D appealed. The Appellate Division reversed finding that she was not 'legally' insane and upheld the contract. P appealed; the definition of 'legal insanity' was too restrictive, D knew that it was dealing with a mentally ill party, and no damage had occurred.