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Nursing Home Arbitration Agreement Enforceable Against Wrongful Death Beneficiaries


A woman was admitted to a nursing home. The woman’s daughter, who held a general power of attorney, signed an arbitration agreement upon the woman’s admission to the nursing home. The arbitration agreement stated that it would apply to wrongful death beneficiaries. Specifically, the arbitration agreement contains the following definition.

 

Parties. This Agreement shall inure to the benefit of and bind the Patient/Resident and the Healthcare Center, their successors, assigns, and intended and incidental beneficiaries.... The term “Patient/Resident” shall include the Patient/Resident, his or her guardian, attorney-in-fact, agent, sponsor, representative, or any person whose claim is derived through or on behalf of the Patient/Resident, including, in addition to those already listed in this Paragraph, any parent, spouse, child, executor, administrator, heir, or survivor entitled to bring a wrongful death claim.

 

The woman’s widower brought a wrongful death claim against the nursing home. The complaint alleged that the nursing home’s negligent treatment caused the woman’s death.

 

The nursing home filed a motion to dismiss the complaint or, alternatively, to stay the proceedings and compel arbitration of all claims in accordance with an agreement entered into by the woman at the time she was admitted to the nursing home. The Stephens County Superior Court granted the nursing home’s motion to stay and compel arbitration.

 

The Court of Appeals of Georgia reversed. The appellate court held that the man’s wrongful death claims were not barred by the arbitration agreement.

 

The Supreme Court of Georgia reversed. The court held that an arbitration agreement governed by the Federal Arbitration Act (FAA) and entered into by a decedent and/or her power of attorney, which bound the decedent and her estate to arbitration, was also enforceable against the decedent’s beneficiaries in a wrongful death action.

 

An arbitration agreement governed by the Federal Arbitration Act (FAA) and entered into by a decedent and/or her power of attorney, which bound the decedent and her estate to arbitration, was also enforceable against the decedent’s beneficiaries in a wrongful death action. The court held that the arbitration agreement expressly bound the widower and any other of the woman’s wrongful death beneficiaries and required them to arbitrate their claims. The court held that a wrongful death action is holy derivative of the decedent’s right of action. Because wrongful death claims are holy derivative, all defenses which could have been made against the decedent also bind the beneficiaries when they pursue a wrongful death claim. The arbitration clause would have been a viable defense against the woman because she signed an agreement to arbitrate claims against the nursing home, which expressly included any wrongful death claims of her beneficiaries. As any wrongful death claims are holy derivative of claims the woman could have pursued, the requirement to arbitrate was also a viable defense against the woman’s wrongful death beneficiaries. The court concluded that the trial court’s grant of the nursing home’s motion to compel arbitration was proper and the appellate court erred by holding otherwise.

 

The Supreme Court of Georgia affirmed the trial court’s grant of the nursing home’s motion to compel arbitration and reversed the appellate court’s reversal of that decision.

 

See: United Health Services of Georgia, Inc., et al., v. Norton, et al., 2017 WL 875035 (Ga., March 6, 2017) (not designated for publication).

 

See also Medical Law Perspectives, November 2015 Report: Risks in Caring for Patients with Cognitive Impairments: Alzheimer’s Disease and Dementia

 

 

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