Insanity defence: lack of mental capacity negates criminal liability when one cannot know the nature or wrongfulness of acts. Act of a person of unsound mind is not an offence where, at the time of doing it, by reason of unsoundness of mind the person is incapable of knowing the nature of the act or that they are doing what is wrong or contrary to law; thus the statute sets a mental-capacity threshold for exclusion from criminal liability based on inability to understand the act or its wrongfulness.