Court Finds Resident Cannot Be Compelled to Enter Arbitration After Daughter Signs Arbitration Agreement

In a recent case, a court decided that a resident’s estate could not be compelled to enter arbitration, even though the deceased resident’s daughter had signed an arbitration agreement on her behalf. When the resident was admitted to a nursing home, her daughter accepted a health care proxy designation on her mother’s behalf, but the mother never executed a durable power of attorney for her daughter. The daughter then signed the home’s admission agreement, which included an arbitration agreement. The arbitration agreement stated that the arbitration agreement was voluntary and that failing to sign the arbitration agreement would not affect a resident’s ability to stay at the facility.

ContractThe nursing home admission agreement defined a legal representative as a person who has authority to act on the resident’s behalf under independent legal authority, such as a guardian or a power of attorney. The mother was not competent at the time the documents were signed. The daughter signed the admission agreement as her mother’s “legal representative” and signed the arbitration agreement under the line designated for a “resident/representative signature.” The daughter signed the documents so that her mother could be admitted to the home.

After the mother died while in the care of the nursing home, the mother’s estate brought a claim against the nursing home, alleging that the home caused the mother injuries that resulted in her death. The nursing home responded by arguing that the case had to be resolved in arbitration, pointing to the arbitration agreement signed by the resident’s daughter. The trial court found that the mother was not competent at the time the admission agreement was signed and that the daughter signed as her legal representative, so the case had to be resolved in arbitration. The mother’s estate appealed.

The appellate court agreed with the mother’s estate. The court stated that the daughter signed the agreements only as her mother’s health care proxy, and a health care proxy does not have the authority to agree to arbitration because it is not a “health care decision.” As a result, the court reversed the decision, allowing the case to proceed in court.

Arbitration Agreements in Nursing Home Admission Agreements

Arbitration is a process of settling disputes through an arbitrator, rather than resolving them through the legal system. It is normally faster and less formal than court proceedings, but arbitration carries different risks and benefits for both parties. Often, nursing homes require residents to sign arbitration agreements when they are admitted to the home. The arbitrations may be mandatory or voluntary. An arbitration agreement requires residents to give up their right to seek relief in court and instead have their case resolved in arbitration.

However, a party cannot be forced into arbitration if the party did not agree to arbitration. Advocates for the elderly have successfully argued that older adults seeking someone to manage their affairs want someone to manage their day-to-day lives, rather than to waive their substantive legal rights.

Contact a Chicago Nursing Home Attorney

If you are considering filing a negligence claim or another type of claim against a nursing home, the Chicago attorneys at Moll Law Group can help you explore the scope of your options. Our lawyers regularly represent residents and their families in cases against nursing homes that have allegedly harmed their loved ones. We represent clients in Naperville, Schaumburg, Wheaton, and communities throughout Cook County. Call us at 312-462-1700 or contact us through our online form to schedule a free consultation.

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