Florida Appellate Court Refuses To Apply Prohibitive Cost Defense In Ordering Nursing Home Arbitration

In its opinion filed on August 23, 2021, the First District Court of Appeal State of Florida (“Florida Appellate Court”) stated, “we affirm the trial court’s order compelling the parties to proceed with arbitration. Further, as to whether prohibitive cost can be a stand-alone defense to an arbitration agreement governed by the FAC, we certify conflict with the decisions of the Second District and the Fifth District.”

The Florida Arbitration Code (FAC) provides: “Two or more parties may agree in writing to submit to arbitration any controversy existing between them at the time of the agreement, or they may include in a written contract a provision for the settlement by arbitration of any controversy thereafter arising between them relating to such contract or the failure or refusal to perform the whole or any part thereof.”

While the Florida Appellate Court stated “Wick’s argument on the prohibitive cost defense does not fail for want of legal authority. Several decisions from the United States Supreme Court suggest that a trial court may find an arbitration agreement invalid based only on the prohibitive cost of arbitration when the cost of arbitration prevents a party from effectively vindicating her statutory rights under federal law,” the Florida Appellate Court further stated, “the Supreme Court has repeatedly declined to apply the exception to invalidate an arbitration agreement in any case before it … The Supreme Court has not extended the effective vindication exception or the prohibitive-cost defense to claims arising under state law. And state courts have reached different conclusions about whether to recognize prohibitive cost as a stand-alone defense to an agreement governed by a state arbitration law and raising state statutory claims.”

“The Florida Supreme Court has not addressed whether a trial court may invalidate an arbitration agreement governed by the FAC based only on the prohibitive cost of arbitration. But Florida’s district courts have. And they have reached different conclusions … Based on our examination of these decisions, we find no persuasive authority for extending the judicially-crafted effective vindication exception and prohibitive-cost defense to an agreement governed by the FAC and presenting a claim arising under state law. The United States Supreme Court has not applied the effective vindication exception to the FAA or the prohibitive-cost defense to invalidate an arbitration agreement in any case since it recognized the effective vindication exception in dicta thirty-six years ago. Absent direction from the Florida Legislature or the Florida Supreme Court, we decline to judicially craft an exception to the FAC based on the prohibitive cost of arbitration. It is simply not the role of the judiciary to rewrite the terms of a contract the parties freely negotiated at arms length.”

Source Wick v. Orange Park Mgt., LLC, No. 1D20-3778.

If you or a loved one suffered harm while a resident of a nursing home in Florida or in another U.S. state due to nursing home abuse, nursing home neglect, nursing home negligence, or the failure to provide appropiate care for a vulnerable adult, you should promptly find a nursing home claim lawyer in Florida or in your state who may investigate your nursing home claim for you and file a nursing home claim on your behalf or behalf of your loved one, if appropriate.

Visit our website to be connected with medical malpractice attorneys (nursing home claim attorneys) in your U.S. state who may assist you with your nursing home claim, or call us toll-free in the United States at 800-295-3959.

Turn to us when you don’t know where to turn.

This entry was posted on Tuesday, October 12th, 2021 at 5:27 am. Both comments and pings are currently closed.

placeholder

Easy Free Consultation

Fill out the form below for a free consultation or contact us directly at 800.295.3959.
  • Please enter the correct answer to this math problem.
  • This field is for validation purposes and should be left unchanged.

    Easy Free Consultation

    Fill out the form below for a free consultation or contact us directly at 800.295.3959