The Underlying Facts
The Administrator of the resident’s estate filed a complaint asserting that defendant Mt. Lebanon Operations, LLC d/b/a Mt. Lebanon Rehabilitation and Wellness Center’s (“Mt. Lebanon’s”) negligent care of the decedent resulted in the decedent’s death, to wit: shortly after the decedent’s admission to Mt. Lebanon’s facility on November 24, 2018, staff noted the decedent had a swallowing disorder that affected her oral intake and the decedent needed to be monitored during meals for aspiration. The decedent aspirated on food and died on January 25, 2019, after allegedly being left unsupervised.
When the decedent was admitted to Mt. Lebanon’s facility in November 2018, the estate’s Administrator executed an Admission Agreement with a provision that required all disputes be resolved in binding arbitration. In a separate section of the Admission Agreement titled “Legal Representative,” the Administrator circled “Yes” in response to a question asking whether she was the decedent’s power of attorney (POA). In a third section of the Admission Agreement addressing the decedent’s “Assigned Authorized Resident Representative,” the Administrator indicated she was “chosen by [the Decedent] but not also authorized by State or federal law[.]”
Agency Relationship
For an arbitration agreement between a nursing facility and a resident’s purported POA agent to be valid, there must be an agency relationship between the resident/principal and the POA agent. A party can be compelled to arbitrate under an agreement, even if he or she did not sign that agreement, if common-law principles of agency and contract support such an obligation on his or her part.
An agency relationship may be created by any of the following: (1) express authority, (2) implied authority, (3) apparent authority, and/or (4) authority by estoppel. Agency cannot be inferred from mere relationships or family ties, and agency may not be assumed merely because one person acts on behalf of another. Family ties may be relevant when considered with other factors evincing agency. The party asserting the agency relationship bears the burden of proving it by a preponderance of the evidence.
Express authority exists where the principal deliberately and specifically grants authority to the agent as to certain matters. A valid, durable power of attorney constitutes a grant of express authority per its terms.
Apparent agency exists where the principal, by word or conduct, causes people with whom the alleged agent deals to believe that the principal has granted the agent authority to act. An agent cannot simply by his own words invest himself with apparent authority. Such authority emanates from the action of the principal and not the agent.
The Pennsylvania Appellate court held that the Admission Agreement drafted by Mt. Lebanon required documentation be attached to prove the Administrator’s legal representative status. “Appellant thus failed to establish [the Administrator] had authority to agree to the arbitration provision, and the trial court did not abuse its discretion in overruling Appellant’s POs seeking to compel arbitration.”
Source Adams v. Mt. Lebanon Operations, LLC d/b/a Mt. Lebanon Rehabilitation and Wellness Center, 2022 PA Super 100.
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