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In my June blog I wrote that arbitration agreements in nursing home contracts are now here to stay in the Commonwealth of Pennsylvania. They can be overcome. There are procedural roadblocks to their enforceability. There are factual issues that may prevent their enforcement. All in all, there is every possibility that an arbitration agreement in a nursing home context may not pass judicial muster.
We are now in the nuts and bolts phase of arbitration agreements. By that I mean we can now expect a whole slew of judicial opinions telling lawyers when and under what circumstances nursing home arbitration agreements are acceptable and binding. The number of judicial opinions will be in direct correlation to imaginations of lawyers looking to find ways to upend these odious agreements.
Nuts and bolts opinions will be coming in Pennsylvania from the lower trial courts. They will also be coming from our appellate courts including Pennsylvania Superior Court. Appellate opinions are the ones to watch out for in that they instruct not only lawyers but they can also be telling the lower courts how to handle arbitration agreement issues that come before them.
A case in point is the Pennsylvania Superior Court opinion in Davis v. Ctr. Mgmt. Grp. (Pa. Super. June 28, 2018).
Plaintiff Brenda Davis brought a lawsuit against a nursing home alleging negligence in the nursing homes care of her mother Ruth Roberts. Ms Roberts died while under the care of the nursing home. When Ms. Roberts was admitted the nursing home had an arbitration agreement in the admission documents. Ms. Davis, the decedents daughter, signed an admission agreement. The decedent had previously granted her daughter a durable power of attorney. The admission agreement named both the decedent and daughter as decedent’s legal representative. The Decedent did not sign the agreement but her daughter signed on the line for legal representative.
The rest follows the usual pattern. Ms. Davis filed suit on behalf of decedent’s estate. The nursing home petitioned to compel arbitration. Davis argued that the agreement was unenforceable citing all the reasons that are available to block these agreements. The trial court overruled appellants’ petition to compel arbitration. A nice victory for the plaintiff. Not so fast. The nursing home appealed. They argued that Ms. Davis, having power of attorney, waived the right to a jury trial and agreed to arbitration.
The Pennsylvania Superior Court did not rule on the validity of the agreement. Instead they issued a “nuts and bolts” opinion on what a trial judge should do when faced with this situation. The Superior Court instructed the lower court that when the nursing home filed its petition to arbitrate the court could NOT rely just on what was in the complaint. The court had to make findings of fact and conclusions of law concerning whether the parties had a valid agreement to arbitrate. In other words the trial court had to dig into the specific facts of the situation. It could not rely on just the pleadings filed to date.
No decision was made on the issue of arbitrability- but the appellate court was telling the lower court what it had to do to reach a decision on the merits.
A nuts and bolts opinion. Expect more.
By Sam Abloeser