Forest Hill Nursing Ctr., Inc. v. McFarlan
| Docket Number: | 2007-CA-00327-COA Linked Case(s): 2007-CA-00327-SCT ; 2007-CA-00327-COA ; 2007-CT-00327-SCT |
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| Court of Appeals: |
Opinion Link Opinion Date: 04-01-2008 Opinion Author: GRIFFIS, J. Holding: Reversed and Remanded |
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| Additional Case Information: |
Topic: Personal injury - Arbitration agreement - Health-care surrogate - Section 41-41-211(1) - Agency relationship - Third-party beneficiary - Unconscionability Judge(s) Concurring: KING, C.J., IRVING, CHANDLER, BARNES, ISHEE, ROBERTS AND CARLTON, JJ. Concur in Part, Dissent in Part 1: Lee, P.J. with separate written opinion. Concur in Part, Dissent in Part Joined By 1: Myers, P.J. Procedural History: Motion to Compel Arbitration Nature of the Case: CIVIL - PERSONAL INJURY; CIVIL - CONTRACT |
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| Trial Court: |
Date of Trial Judgment: 01-31-2007 Appealed from: Hinds County Circuit Court Judge: Bobby DeLaughter Disposition: MOTION TO COMPEL ARBITRATION DENIED Case Number: 251-04-851CIV |
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| Party Name: | Attorney Name: | Brief(s) Available: | ||
| Appellant: | FOREST HILL NURSING CENTER, INC., LONG TERM CARE MANAGEMENT, LLC, HUGH FRANKLIN, SCOTT A. LINDSEY AND RHONDA BOUNDS |
STEVEN MARK WANN,
PAUL HOBART KIMBLE,
HEATHER MARIE ABY |
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| Appellee: | MARY LOUISE MCFARLAN AND PATRICIA MATHEWS | SUSAN NICHOLS ESTES, DOUGLAS BRYANT CHAFFIN, KENNETH L. CONNOR |
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Synopsis provided by:  If you are interested in subscribing to the weekly synopses of all Mississippi Supreme Court and Court of Appeals hand downs please contact Tammy Upton in the MLI Press office. |
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| Topic: | Personal injury - Arbitration agreement - Health-care surrogate - Section 41-41-211(1) - Agency relationship - Third-party beneficiary - Unconscionability |
| Summary of the Facts: | Mary McFarlan filed suit against Forest Hill Nursing Center based on alleged personal injuries that she sustained while a resident at Forest Hill. The defendants filed a motion to compel arbitration which was denied by the circuit court. Forest Hill appeals. |
| Summary of Opinion Analysis: | Forest Hill argues that the arbitration clause contained in the admission agreement is valid because McFarlan’s granddaughter, Patricia Mathews, had the authority to bind McFarlan to the agreement as her health-care surrogate, Mathews had the authority to bind McFarlan to the agreement under the principles of agency, McFarlan was a third-party beneficiary to the agreement between Mathews and Forest Hill, and the agreement is not unconscionable. The Uniform Healthcare Decisions Act does not apply to persons who are competent. It is clear from the language of section 41-41-211(1) that a surrogate may make health-care decisions for a patient only after the patient is found to be incapacitated by a physician. Because there is no evidence that a physician found McFarlan to be incapacitated, Mathews did not have the authority to bind McFarlan to the admission agreement as her healthcare surrogate. It is also clear that Forest Hill has not shown that Mathews had an express agency relationship with McFarlan. An express agent is one who is in fact authorized by the principal to act on their behalf. There is no evidence that any type of agreement existed between McFarlan and Mathews that would give Mathews the authorization to act on McFarlan’s behalf. In addition, Forest Hill offers no evidence of any words or conduct on the part of McFarlan to imply that Mathews was her agent or had any authority to act on her behalf by signing the admissions agreement. Finally, there is insufficient evidence to prove that Mathews had apparent authority to bind McFarlan to the arbitration agreement. There is no proof of any action taken by McFarlan, as principal, to show that an agency relationship existed when Mathews signed the agreement. With regard to whether McFarlan is a third-party beneficiary of the agreement, although McFarlan did not sign the admission agreement, many other factors indicate that she is a third-party beneficiary to the agreement. McFarlan’s care was not incidental to the contract, but instead was the essential purpose of the agreement. Because she is an intended third-party beneficiary of the agreement between Forest Hill and Mathews, she is bound by the terms of the contract, including the agreement to arbitrate any legal disputes related to the contract. The dispute between the parties arises out of the relationship between resident and facility created by the admission agreement and consequently falls within the scope of the arbitration clause. The agreement is not procedurally unconscionable. The wording of the document is not presented in complex legalistic language. A paragraph written in bold-faced letters draws attention to the fact that the parties are giving up their constitutional right to have a claim decided before a judge and jury. The agreement also states that the party has a right to seek legal counsel, the signing of the agreement is not a precondition to admission, and the contract may be rescinded within thirty days. Also, the arbitration agreement is not substantively unconscionable. The arbitration clause neither significantly alters McFarlan’s legal rights or severely limits the damages available to her. There is no required grievance resolution process, no limit on the amount of damages, no waiver of punitive damages, and no requirement to compensate Forest Hill’s staff for their involvement in a dispute. The case is reversed and remanded for the trial court to order arbitration. |
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