Arbitration Clauses / Contracts

July 8, 2024

Optional arbitration agreement at nursing home was legal decision.

Signing an optional arbitration agreement during the process of signing other nursing home admission paperwork is a legal decision, not a healthcare decision, according to the Tennessee Supreme Court.

In Williams v. Smyrna Residential , LLC, 685 S.W.3d 718 (Tenn. 2024), Granville Williams, Jr. (“Williams”) executed a durable power of attorney (“POA”) appointing his daughter, Karen Sams (“Sams”), as his attorney-in-fact. This POA gave Sams authority to act for Williams “in all claims and litigation matters.” The POA did not mention healthcare decisions and no healthcare POA was executed.

In 2020, Sams assisted with Williams’ admission to defendant nursing home. Sams signed the admission paperwork for Williams, which included an arbitration agreement. Although the admission contract stated that it incorporated the terms of the arbitration agreement, the arbitration agreement itself stated that it was optional and “not a condition of admission” to the nursing home. Two months later, Williams died.

July 1, 2024

Optional arbitration agreement not a healthcare decision.

by The Law Offices of John Day, P.C.

A healthcare power of attorney does not give the attorney-in-fact authority to sign an optional arbitration agreement on behalf of a patient.

In Hall v. Quality Center for Rehabilitation and Healing, LLC, No. M2022-01028-COA-R3-CV (Tenn. Ct. App. May 9, 2024), plaintiff’s husband died at a hospital after living at defendant nursing home. Before admission to the nursing home, the husband signed a healthcare power of attorney granting plaintiff/wife the authority to make health care decisions on his behalf. Plaintiff signed the nursing home admission form for her husband, as well as an optional arbitration agreement upon admission.

After the husband’s death, plaintiff filed this wrongful death case. Defendant moved to have the trial court compel arbitration based on the optional arbitration agreement plaintiff signed. The trial court denied the motion to compel arbitration, and the Court of Appeals affirmed.

October 27, 2023

Statutory immunity provisions related to health care powers of attorney did not prevent inquiry into whether decedent had mental capacity to execute power of attorney.

by The Law Offices of John Day, P.C.

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.

August 8, 2022

Nursing home arbitration agreement ruled unenforceable.

by The Law Offices of John Day, P.C.

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.

April 25, 2022

More On Powers of Attorney, Arbitration Agreements, and Wrongful Death

by The Law Offices of John Day, P.C.

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.