Is a health club membership contract legally binding if entered into by a mentally handicapped person?

Based on the facts you have recited, no. Capacity to contract is essential to contract formation. If your brother in law lacks capacity then he cannot enter into binding contracts. See a GA lawyer to determine just what cpaacity means in GA.

The capacity to enter into a contract in Georgia involves a couple of inquiries. First, has your brother-in-law been adjudicated mentally impaired by a court and appointed a guardian? If so, then under the law he is presumed incapable of having the mental capacity to enter into a contract and the contract is absolutely void.

If there has been no adjudication of incompetency, the law presumes that the party has his or her mental faculties and is of normal and ordinary intelligence, and, correspondingly, mental impairment must be proved. The test in GA to prove mental incapacity requires a showing that the person “is not possessed of sufficient mind and reason for a full and clear understanding of the nature and consequence of his or her act in making the contract,” and that the person has an entire loss of understanding. Since this is a question of fact and the law presumes the contract to be valid, the burden is on you to prove that your brother-in-law is mentally incapable of entering into the contract and the impairment existed at the time the contract was executed.

However, if the opposing party has reason to believe the other party has a mental impairment or exerts undue influence to induce the mentally impaired person to enter the contract, these factors favor declaring the contract void.

If you would like representation on this case, you can find my contact information on my Avvo page.