A dynamic model is stored in memory that defines torque transmitted by a lockup clutch in a torque converter as a function of a plurality of torque converter operating parameters. A lockup clutch command to control engagement the lockup clutch is asserted, and thereafter a number of the plurality of torque converter operating parameters are monitored. The model is continually solved using the monitored operating parameters to determine torque transmitted by the lockup clutch over time, and a lockup clutch on-coming capacity signal is produced if the torque transmitted by the lockup clutch exceeds a torque threshold.