Articles Posted in Arbitration Clauses / Contracts

Where an arbitration agreement had been signed by a decedent’s attorney in fact upon the decedent’s admission into a nursing home, and on a motion to compel arbitration filed by the nursing home the trial court considered evidence on whether the decedent had the mental capacity to execute the power of attorney for healthcare, the Tennessee Supreme Court affirmed the trial court’s consideration of such evidence. The Supreme Court held that the immunity provisions in Durable Power of Attorney for Health Care Act and the Health Care Decisions Act did not bar the trial court from considering evidence of the decedent’s mental capacity.

In Welch v. Oaktree Health and Rehabilitation Center LLC d/b/a Christian Care Centers of Memphis, No. W2020-00917-SC-R11-CV, — S.W.3d — (Tenn. Aug. 31, 2023), plaintiff was decedent’s brother and brought this wrongful death claim against defendant nursing home. Decedent had been diagnosed with down syndrome when he was born, and he could not read and had difficulty understanding instructions. In connection with an eye surgery in 2012, plaintiff had helped decedent scratch his name on a durable power of attorney for healthcare (“POA”). Plaintiff had printed and filled out the POA.

In the subsequent years, plaintiff used the POA several times when assisting decedent with obtaining healthcare. In 2016, plaintiff had decedent admitted to defendant nursing home. Plaintiff filled out several documents in connection with the admission, including an optional arbitration agreement, on behalf of decedent. It was uncontested that plaintiff would have shown defendant the POA during the admission process.

In a recent HCLA case, the Court of Appeals affirmed the trial court’s denial of defendant’s motion to compel arbitration, agreeing that the arbitration agreement was an unenforceable contract of adhesion.

In Stancil v. Dominion Crossville, LLC, No. E2021-01378-COA-R3-CV (Tenn. Ct. App. July 29, 2022), plaintiff filed an HCLA claim on behalf of her mother (who died while this litigation was pending) based on the care she received at defendant nursing home. At the time of the mother’s admission to the nursing home, she had dementia, so plaintiff signed the admission documents on her behalf as her durable general power of attorney and durable power of attorney for health care.

After plaintiff filed this suit, defendant filed a motion to compel arbitration based on an arbitration provision in the admission contract. Considering the evidence presented, the trial court denied the motion, and the Court of Appeals affirmed this denial.

Where the person who executed an arbitration agreement in connection with decedent’s admission to a nursing home had a power of attorney for decedent, but that power of attorney did not mention the ability to make health care decisions, the arbitration agreement was unenforceable. Further, decedent’s wrongful death beneficiaries would not have been bound by the arbitration agreement even if it were enforceable.

In Williams v. Smyrna Residential, LLC, No. M2021-00927-COA-R3-CV (Tenn. Ct. App. April 8 2022), plaintiff was the son of decedent, who died while he was a resident at defendant assisted living center. Plaintiff filed this wrongful death action on behalf of decedent’s wrongful death beneficiaries. In response to the complaint, defendant filed a motion to compel arbitration. According to defendant, decedent’s daughter had executed an arbitration agreement on decedent’s behalf when decedent was admitted to the facility. At the time, the daughter was the named attorney-in-fact in decedent’s durable power of attorney (POA). Plaintiff argued that the arbitration agreement was not enforceable because the POA did not mention the authority to make health care decisions, and the trial court agreed, denying the motion to compel arbitration. On appeal, this ruling was affirmed.

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