Massachusetts Appeals Court Overturns Nursing Home Arbitration Victory

Share Article discusses in today's blog posting the August 18, 2014 decision of the Appeals Court of Massachusetts that overturned a nursing home's arbitration win

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The loss for the nursing home is a win for all of its residents, the premier free website that connects medical malpractice victims in the United States with medical malpractice lawyers in their state, discusses in today's blog the August 18, 2014 decision of the Appeals Court of Massachusetts that overturned a nursing home's arbitration win.

The Appeals Court of Massachusetts ("Appeals Court") overturned a trial court's decision that a claim against a nursing home for the beating and strangulation death of a 96-year-old resident by her 97-year-old roommate was required to be arbitrated pursuant to an arbitration agreement that had been signed by the resident's son three years prior.

The Appeals Court held that the resident's son did not have a durable power of attorney, he was not acting as his mother's guardian or conservator when he signed the nursing home arbitration agreement, and that a health care proxy is insufficient to authorize the health care agent to sign an arbitration agreement. Furthermore, there was no evidence or suggestion that the resident had specifically authorized her son to sign the arbitration agreement, which, by its express terms, was not a requirement of admission to the nursing home. Lastly, the Appeals Court held that the son did not sign the arbitration agreement in his individual capacity and that principles of equitable estoppel did not preclude the son from bringing suit.

The Underlying Facts:

At the time of the resident's admission to the nursing home on February 16, 2006, her son completed the admission authorization process for his mother, at his mother's request. The admission process included executing numerous agreements, such as a consent for admission, a consent for treatment, a physician consent, and various others enumerated on a two-page "admission authorization" form.

In addition, the resident's son signed a "Resident and Facility Arbitration Agreement," which was not a condition of admission and was not listed on the admission authorization form, that provided that "any legal dispute, controversy, demand or claim . . . that arises out of or relates to the Resident Admission Agreement or any services or health care provided by the Facility to the Resident, shall be resolved exclusively by binding arbitration." The son signed and dated the arbitration agreement on the line for the "Resident Representative Signature," below a paragraph certifying that the signatory was "the Resident, or a person duly authorized by the Resident, which shall include a responsible party, Health Care Proxy, Power of Attorney, or Legal Guardian."

The mother did not sign the agreement, she did not specifically authorize her son to sign the agreement, and the son never informed his mother that he entered into an arbitration agreement. Her son did not hold a power of attorney and he was not his mother's legal guardian or conservator.

After his mother's death, the son filed a nursing home negligence lawsuit in court and the nursing filed a motion to compel arbitration, pursuant to the Resident and Facility Arbitration Agreement, which the trial court granted. The subsequent arbitration proceeding resulted in a finding in favor of the nursing home. The resident's son appealed.

The Appeals Court found that the nursing home did not met its burden of showing that signing the arbitration agreement was within the scope of the son's actual or apparent authority to act on his mother's behalf in the nursing home admission process. Furthermore, the nursing home could not rely on the doctrine of equitable estoppel (to establish estoppel, a party must show (1) a representation intended to induce reliance on the part of a person to whom the representation is made; (2) an act or omission by that person in reasonable reliance on the representation; and (3) detriment as a consequence of the act or omission) because the nursing home could not show that any representations induced it to do something different than it otherwise would have done because signing the arbitration agreement was not a condition of admission and the nursing home did not argue that it would have treated the resident differently in any other way if the agreement had not been signed.

The Appeals Court concluded that the son did not have the authority to execute the arbitration agreement on his mother's behalf; he did not sign the agreement in his individual capacity; and, equitable estoppel is not warranted on the facts of the case. Therefore, the son, as executor of his mother's estate, would be permitted to seek redress in court for his mother's death while in the defendant nursing home's care. The Appeals Court vacated the judgment confirming the arbitration award and remanded the case to the Superior Court for proceedings consistent with its opinion.

The Appeals Court case is captioned Barrow v. Dartmouth House Nursing Home, 2014 Mass. App. LEXIS 99.

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