Agreement to Arbitrate Disputes Over Nursing Home Care
quite typical, when a person is admitted to a nursing home or similar facility,
that as part of the package of documents executed that there be an agreement to
arbitrate any disputes. Often these
agreements are executed by a family member or someone else acting pursuant to a
power of attorney, the person being admitted not being in a position to review
and execute them themselves. A
significant string of Kentucky cases have held that these agreements to
arbitrate are not enforceable because the power of attorney did not authorize
the agent to bind the principal to arbitration.
A recent case found that the power of attorney was sufficient to bind
the person being admitted to arbitration.
Bardstown Medical Investors, Ltd.
v. Dukes, No. 2013-CA-001783-MR (Ky. App. Jan. 23, 2015).
Dukes was admitted to the Life Care Center of Bardstown in connection with
certain admission documents executed by Bobby Dukes, her husband and the holder
of her power of attorney. That power of
attorney specifically authorized Bobby too, on Doris’ behalf, “enter into
contracts of any kind of [sic - or]
description whatsoever, and to exercise any light [sic - right], option or election which I may have or acquire under
any contract.” The power of attorney went on to give Bobby Dukes, on Doris
behalf, the right “to compromise, settle renew any claim of or against me, or
any right which I may be entitled to assert and which may be asserted against
of Doris, Bobby had filed suit against the Life Care Center of Bardstown
alleging numerous instances of negligence.
Life Care Center sought an order requiring that the dispute go to
arbitration. In reliance upon Ping v. Beverly
Enterprises, Inc., 376 S.W.2-D 581 (KY. 2012), the trial court denied the
motion to compel arbitration. In Ping, the Kentucky Supreme Court
determined that there was no binding agreement to arbitrate on the basis that
the person who executed the arbitration agreement held only a health-care power
of attorney from the person admitted.
of Appeals would reverse. In this instance, the power of attorney specifically
authorized Bobby Dukes, on Doris’ behalf, to enter into commercial
agreements. As such, Doris had
implicitly given to Bobby authority to on her enter into an agreement to
arbitrate. In connection there with, the
Court of Appeal cited the Restatement (Third) of Agency § 2.02(1), it
An agent has
actual authority to take action designated or implied in the principal's
manifestations to the agent and acts necessary or incidental to achieving the
principal's objectives, as the agent reasonably understand the principal's
manifestations and objectives when the agent determines how to act.