Court Refuses To Enforce Nursing Home Arbitration: What happens when the representative of a nursing home resident signs an arbitration agreement on behalf of the resident at the time of the admission, the resident later leaves the nursing home and returns home, but the resident returns to the same nursing home at which time new admission documents are signed by the resident’s representative who then refuses to sign a new arbitration agreement at that time? If a claim for personal injury is filed against the nursing home regarding the second admission, can the nursing home enforce the original arbitration agreement? And who determines the issue of arbitrability — an arbitrator or a judge?
The United States District Court for the District of Delaware was faced with those issues recently and determined that a judge, not an arbitrator, determines the initial issue if arbitration is required, and that the original arbitration agreement was unenforceable under the circumstances.
The Court stated: “Both Robert Senior and Robert Junior refused to sign the 2019 Voluntary Arbitration Agreement, and someone wrote on that agreement “declined to sign.” D.I. 13 ,r 63. Moreover, none of the parties to the contract initialed section five of the 2019 Admission Agreement to express disagreement with that section’s provision that “[a]ll claims relating to … any past, present or future admission of [Robert Senior] to the [Pike Creek facility], including … any claim relating in any way to the care and treatment provided to [Robert Senior], will be brought in the” Delaware Superior Court in New Castle County. D.I. 13-2 at 4 (emphasis added). Thus, by signing the 2019 Admission Agreement and not initialing section five, both Manor Care and Robert Junior made clear that the parties intended to litigate all their disputes in the Delaware Superior Court, not in an arbitration proceeding. The 2019 Admission Agreement and 2019 Voluntary Arbitration Agreement therefore supersede the 2018 Voluntary Arbitration Agreement.”
The Court further determined that it was for the court to decide the initial issue of arbitrability, citing a Third Circuit decision: “Two issues stem from this gateway concern. First, who should decide whether the second contract replaced the first, a court or an arbitrator? Second, if a court, rather than an arbitrator, should decide, does the parties’ [second] contract in fact supersede their earlier agreement? … “arbitration is strictly a matter of consent.” An arbitrator’s authority is limited to those claims that “the parties have agreed to submit to arbitration.” So before sending parties to an arbitrator, a court must decide whether they agreed to resolve their dispute in that forum, which in tum requires it to determine “whether an arbitration agreement exists at all[.]” Because the substance of the parties’ supersession
dispute is “whether there is an agreement to arbitrate,” the District Court rightly declined to send it to an arbitrator.”
McRedmond v. HCR Healthcare, LLC, Civil Action No. 22-692-CFC.
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