On behalf of her decedent husband, Edward Goldman, Judy Goldman sued for alleged neglect by the operators of two skilled nursing facilities: Carmichael Care and Rehabilitation Center (Carmichael Care) and Rosewood Terrace Care and Rehabilitation (Rosewood Terrace).
Carmichael Care and Rosewood Terrace each sought to compel arbitration based on documents Judy signed when Edward was admitted to each of the facilities.
Carmichael Care and Rosewood Terrace appeal from the orders refusing to compel arbitration and present nearly identical arguments. Defendants contend (1) Judy had authority to sign the admissions papers containing the arbitration agreements because Edward was unable to sign for himself, (2) Judy signed not only on Edward's behalf, but also for herself when she agreed to arbitration, (3) public policy compels enforcement of the arbitration
In May 2011, Edward — by and through his successor, Judy — filed a complaint setting forth causes of action for elder abuse, fraud, and violations of the Patients Bill of Rights (Health & Saf. Code, § 1430, subd. (b); Cal. Code Regs., tit. 22, § 72527).
The complaint alleged Edward was 61 years old on February 25, 2010, when he was admitted to Carmichael Care, a skilled nursing facility. Edward was transferred to Carmichael Care after a short stay at the Veterans Administration (VA) Medical Center where he had been treated for gastrointestinal bleeding. Although Edward suffered a stroke in 2008 that left him weak on his left side, he had been living independently at home with Judy. Over the course of four months at Carmichael Care, Edward sustained six falls — several of which were undocumented by the facility's staff. On the sixth fall, Edward fractured his left hip. The facility staff did not document the fall or immediately respond to Judy's requests to have X-rays taken of Edward's hip. Three days after the fall, an X-ray was taken and Edward was rushed to the emergency room. On June 28, 2010, Edward's hip was surgically repaired at Mercy San Juan hospital.
In addition to appearing as Edward's successor, Judy also sued on her own behalf to assert causes of action for negligent infliction of emotional distress and wrongful death.
In July 2011, Carmichael Care petitioned to compel arbitration and introduced copies of the arbitration agreements signed by Judy. Carmichael Care also introduced a copy of Edward's VA advance directive: Durable Power of Attorney for Health Care and Living Will (VA advance directive), which included a durable power of attorney appointing Judy as his health care agent in the event he became unable to make decisions for himself. In pertinent part, Edward's VA advance directive stated: "I appoint the person named below to make decisions about my health care if there ever comes [a] time when I cannot make those decisions." Judy was listed as the person to be appointed in such a circumstance. The VA advance directive was signed by Edward and witnessed on February 9, 2010.
Plaintiff opposed the petition and introduced a declaration by Judy that Edward was capable of and actually did make health care decisions for himself before and during his stay at Carmichael Care. Judy's declaration further stated: "As to the signing of the arbitration agreement, a person from the facility merely told me that I needed to sign some more forms for my husband. The person from the facility did not say what the forms were, that they involved arbitration, or that there was a choice in the signing of the
In reply, Carmichael Care submitted a form titled "Authorizations, Acknowledgments and Consents" signed and initialed multiple times by Judy. The form had a blank line following text stating, "If Resident is unable to sign this form, please state the reason." On this line, Judy wrote "Stroke."
In September 2011, Rosewood Terrace filed a motion to compel arbitration and introduced arbitration agreements signed by Judy.
Plaintiff opposed Rosewood Terrace's motion and submitted a declaration by Judy that stated Edward was capable of and actually did make health care decisions for himself before and during his stays at Rosewood Terrace. Mirroring her earlier declaration, Judy's declaration in opposition to the Rosewood Terrace motion stated: "As to the signing of the arbitration agreement, a person from the facility merely told me that I needed to sign some admission forms for my husband. The person from the facility did not say what the forms were, that they involved arbitration, or that there was a choice in the signing of the documents. The person from the facility never inquired of me whether my husband was capable of signing the documents or discussed with me that the documents needed to be signed by my husband if he was capable. Had this issue been raised, I certainly would have told the facility employee that my husband was capable of making his own health care decisions."
The trial court refused to order plaintiff to arbitrate her claims. As to Carmichael Care, the trial court found that Judy signed two arbitration agreements on Edward's behalf when he was admitted to that facility. At the same time she signed the arbitration agreements, Judy also signed a document noting she was signing on Edward's behalf due to "Stroke." However, the trial court found Carmichael Care "presented no evidence that such a determination was ever made by Edward Goldman's primary care physician."
As to Rosewood Terrace, the trial court concluded there was no evidence showing Edward's primary care physician ever made a determination Edward lacked capacity to make his own health care decisions. Instead, the court noted plaintiff had "submitted a doctor's report indicating that at the time Edward Goldman was admitted to Rosewood, he was `awake' and `alert,' and communicated to the doctor in a manner inconsistent with a person who was too ill to make health care decisions. [Citation.] Defendants have failed to meet their burden to establish that the Advance Health Care Directive was in effect, and thus, that Judith Goldman was authorized to execute the arbitration agreements on Edward's behalf."
Finally, the trial court stated that "even if there were a valid agreement to arbitrate, the court would exercise its discretion under [Code of Civil Procedure section] 1281.2. The Court is also denying [Carmichael Care's] petition to arbitrate, and the claims against the remaining defendant North American Health Care, Inc., are not subject to arbitration. Plaintiff's claims under the Patient's Bill of Rights are not subject to arbitration pursuant to the terms of the Arbitration Agreement."
Carmichael Care and Rosewood Terrace each timely filed a notice of appeal from the orders denying the petition and motion to compel arbitration. (Code Civ. Proc., § 1294, subd. (a).)
Carmichael Care and Rosewood Terrace contend Judy had authority to sign the arbitration agreements on Edward's behalf. We are not persuaded.
The record in this case shows that approximately three weeks before his admission to Carmichael Care, Edward executed a VA advance directive, which conferred Judy with authority to make decisions on his behalf only if he became unable to do so for himself. Under the plain language of the VA advance directive, Edward agreed to give Judy authority to make health care decisions on his behalf only "if there ever comes [a] time when I cannot make those decisions." Plaintiff introduced evidence that Edward was lucid and mentally capable at the time of his admission to Carmichael Care. Plaintiff also introduced evidence that Edward was alert and oriented at the time of his admission to Rosewood Terrace. During his time at Carmichael Care and Rosewood Terrace, Edward made numerous health care decisions for himself. Also, on July 1 (the day he was admitted to Rosewood Terrace) and July 20 (while at Rosewood Terrace), Edward signed a physician order for life-sustaining treatment (POLST) form.
Carmichael Care and Rosewood Terrace do not contend the VA advance directive expired or that Edward lost capacity to make his own decisions about whether to enter into an arbitration agreement at the time he was admitted to their facilities. Indeed, both acknowledge Edward "could make decisions, for example decisions about such things as his own health care."
Carmichael Care and Rosewood Terrace assert that even though Edward had the capacity to make his own decisions, someone had to sign documents for him because he could not do so himself. In the trial court, none of the defendants offered evidence or even made an offer of proof regarding Edward's inability to sign documents when admitted to their care. Consequently, the contention has not been preserved for review. (Shaw v. County of Santa Cruz (2008) 170 Cal.App.4th 229, 282 [88 Cal.Rptr.3d 186].)
Carmichael Care asserts Judy's mere status as Edward's wife gave her authority to sign the arbitration agreements on his behalf, "[o]therwise, the married couple would have to go through the formality of creating a formal agency relationship, just to sign the various long-term care documents." Rosewood Terrace echoes the assertion. A nearly identical contention was rejected in Flores, supra, 148 Cal.App.4th at page 589. Flores involved a husband, Luis, who signed an arbitration agreement on behalf of his wife, Josephina, at the time of her admission to Evergreen at San Diego, a skilled nursing facility. (Id. at p. 584.) In the admission agreement, "... Luis signed a line designated `[a]gent'; on other admission documents he signed lines variously designated `[l]egal [r]epresentative' or `[R]esponsible [p]arty.'" (Id. at p. 585.) However, no evidence established that Josephina conferred him with authority to bind her to the arbitration agreement. (Id. at p. 589.) When Josephina and Luis sued Evergreen, the facility moved to compel arbitration. (Id. at pp. 585-586.) The trial court denied the motion and the Court of Appeal affirmed on grounds that no conduct by the principal, Josephina, conferred Luis with authority as an agent to bind her to arbitration. (Id. at pp. 587-589.)
The present action presents an even stronger case than in Flores for rejecting marital status as sufficient to confer agency because Edward's VA advance directive expressly reserved the right to make his own decisions until and unless he became incapacitated. (See Flores, supra, 148 Cal.App.4th at pp. 584, 589.) For this reason, we also reject the suggestion at oral argument by counsel for Carmichael Care, that the "close relationship" between Judy and Edward gave her authority to sign for him. We decline to carve from Flores's holding an exception for marriages deemed to be especially "close." Even apart from the difficulty in formulating such a test, the status of marriage cannot substitute for the act of conferring agency to a spouse. (Id. at p. 589; Russell v. Dopp, supra, 36 Cal.App.4th at p. 783.)
The Flores court affirmed even though Evergreen introduced a power of attorney executed by Josephina in Luis's favor after her admission to the facility. (Flores, supra, 148 Cal.App.4th at pp. 588-589.) As Flores noted, "no facts were presented suggesting that by signing the power of attorney form Josephina intended to ratify Luis's earlier agreement to the arbitration." (Ibid.) For the same reason, we reject Carmichael Care and Rosewood Terrace's assertion that "[g]iven their marital relationship, given the situation which required that he receive long-term care, and given that he was `alert,' `oriented,' and `capable,' the only reasonable inference to draw is that [Edward] was or soon would be aware of what she had done." Here, as in Flores, there was no evidence Edward ratified Judy's signing of the arbitration agreements. (Flores, supra, 148 Cal.App.4th at pp. 588-589.) Thus, we also reject Rosewood Terrace's contention that Judy "signed for [Edward], just as most people in the situation sign for their spouses, and there is no evidence that he ever objected to her doing so." Edward did not need to object in order to preserve his right to make his own health care decisions. (Ibid.)
Here, defendants did not introduce any evidence that Edward — by words or actions — agreed to have Judy sign arbitration agreements or make health care decisions for him while he was capable of making them for himself. Thus, defendants failed to meet their burden of proof to establish Edward agreed to arbitration of any legal disputes. (Garrison, supra, 132 Cal.App.4th at p. 263.)
In sum, neither Carmichael Care nor Rosewood Terrace met its burden to establish Judy had authority to agree to arbitration on Edward's behalf.
Carmichael Care and Rosewood Terrace contend Judy "acknowledged when she signed the arbitration agreements that she agreed to arbitrate her own claims arising from the care that she was requesting on [Edward's] behalf." We disagree.
In pertinent part, the arbitration agreement signed by Judy at the time of Edward's admission at Carmichael Care provides: "This agreement, made on 3/24/10 (date) by and between the parties, Resident Goldman, Edward and Resident's Legal Representative ____ (collectively referred to hereinafter as `Resident'), and the Facility Carmichael Care Center, is an Agreement intended to require that Disputes (the scope of which is described in section `B') be resolved by arbitration. The Resident's Legal Representative agrees that he or she is executing this agreement as a party, both in his or her representative and individual capacity." (Italics indicates handwritten interlineations.)
Elsewhere in the agreement, Judy indicated she accepted the agreement with her "Initial of Resident/Legal Representative." At the end of the
Judy also signed a medical practice arbitration agreement that provided in pertinent part: "This agreement, made on 3/24/10 (date) by and between the parties, Resident Goldman Edward and Resident's Legal Representative ___ (collectively referred to hereinafter as `Resident'), and the Facility Carmichael C. Center, is an Agreement intended to require that Disputes (the scope of which is described in section `B') be resolved by arbitration. The Resident's Legal Representative agrees that he or she is executing this agreement as a party, both in his or her representative and individual capacity." (Italics indicates handwritten interlineations.) For this agreement, Judy signed on the line labeled, "Initial of Resident/Legal Representative." At the end of the seven-page agreement, Judy signed on a line indicating, "Signature of Resident's Legal Representative in his/her Individual and Representative Capacity."
In support of its motion to compel arbitration, Rosewood Terrace introduced a document titled, "Arbitration of Medical Malpractice Disputes," which stated in pertinent part: "By signing this arbitration agreement below, Resident agrees to be bound by the forgoing arbitration provisions. [¶] ... [¶] This arbitration agreement shall bind the parties hereto, including the heirs, representatives, executors, administrators, successors, and assigns of such parties." The signature line labeled, "Resident" is blank. Edward's name does not appear anywhere on the form. Instead, Judy signed only on the line labeled, "Responsible Party."
Edward's name also does not appear anywhere on the form titled, "Arbitration of Other Disputes," which provided that "Resident and the Facility further agree that any dispute arising between them from torts, contracts or otherwise, including any claims for punitive damages and any actions brought on behalf of the Resident by third-parties, but exception [sic] claims pertaining to the amount of the Facility's charges, shall be submitted upon request of either the Resident or the Facility to arbitration as provided by California law." The signature line for "Resident" is blank. Judy's signature appears on the line labeled, "Responsible Party (if any)."
On the same day as she signed admissions forms for Edward's admission to Rosewood Terrace, Judy also signed an advisement stating, "Your Rights as a Resident." Judy signed on a line simply marked, "Signature."
Judy was not a party to the Carmichael Care arbitration agreement. Clearly, she was not a "resident" of the facility. And, our conclusion that Judy did not have authority to sign the arbitration agreements on behalf of Edward means she was not his "[l]egal [r]epresentative" as described in Carmichael Care's arbitration agreement. Moreover, Carmichael Care did not include Judy's name on the blank line provided to name the resident's legal representative.
Nonetheless, Carmichael Care asserts Judy herself was bound by the arbitration agreements because the arbitration agreement provided that "... Resident's Legal Representative agrees that he or she is executing this agreement as a party, both in his or her representative and individual capacity." (Italics added.) Carmichael Care points to Judy's signature on the line labeled, "Signature of Resident's Legal Representative in his/her Individual and Representative Capacity." We reject the argument.
Judy also is not individually bound by the arbitration agreement with Rosewood Terrace. Rosewood Terrace's arbitration agreement provides only that "... Resident agrees to be bound by the forgoing arbitration provisions." (Italics added.) Judy was not the resident, and this agreement did not make anyone other than the facility and Edward parties to the contract. Consequently, Judy is not precluded from bringing her own claims. Even though the agreement purports to bind the unidentified resident, including his or her "heirs, representatives, executors, administrators, successors, and assigns of such parties," Judy did not waive any of her individual claims by purporting to sign on Edward's behalf. As explained in part I, Judy had no authority to sign on behalf of Edward.
Based on Judy's ineffective signatures on the Carmichael Care and Rosewood Terrace arbitration agreements, we reject defendants' reliance on Ruiz v. Podolsky, supra, 50 Cal.4th 838 (Ruiz). Ruiz involved the question of whether a patient's agreement to arbitrate medical malpractice disputes, including wrongful death claims, could also bind the patient's heirs even though they themselves never signed the agreement. (Id. at p. 841.) The Supreme Court held the patient's assent to arbitration bound his successors and heirs even as to wrongful death claims, which are independent actions accruing to a decedent's heirs. (Ibid.) Defendants in this case contend the holding in Ruiz applies to bind Judy to the arbitration agreements for her own wrongful death and negligent infliction of emotional distress claims. We reject the contention.
Finally, Carmichael Care and Rosewood Terrace argue that "[p]ublic policy dictates that the arbitration agreements should be enforced." We reject the argument because we are not at liberty to ignore the well-established California law that "[t]he party seeking to compel arbitration bears the burden of proving the existence of a valid arbitration agreement." (Flores, supra, 148 Cal.App.4th at p. 586.) Even though it is true — as defendants point out — that "arbitration has become an accepted and favored method of resolving disputes..." (Madden v. Kaiser Foundation Hospitals (1976) 17 Cal.3d 699, 706-707 [131 Cal.Rptr. 882, 552 P.2d 1178]), it is well settled that an arbitration agreement requires consent. Simply put, "`[t]he strong public policy in favor of arbitration does not extend to those who are not parties to an arbitration agreement, and a party cannot be compelled to arbitrate a dispute that he [or she] has not agreed to resolve by arbitration.'" (Lee v. Southern California University for Professional Studies (2007) 148 Cal.App.4th 782, 786 [56 Cal.Rptr.3d 134], quoting Benasra v. Marciano, supra, 92 Cal.App.4th at p. 990.)
The orders denying (1) the petition to compel arbitration filed by SunBridge Healthcare, LLC (formerly known as SunBridge Healthcare Corporation), Regency Health Services, Inc., Sun Healthcare Group, Inc., and SunBridge Carmichael Rehabilitation Center (doing business as Carmichael Care and Rehabilitation Center), and (2) the motion to compel arbitration filed by Carmichael Care, Inc. (doing business as Rosewood Terrace Care and Rehabilitation), North American Health Care, Inc., and John Sorensen are
Hull, Acting P. J., and Butz, J., concurred.
The first set of defendants relates to Edward's stay at Carmichael Care and consists of SunBridge Healthcare, LLC (formerly known as SunBridge Healthcare Corporation), Regency Health Services, Inc., Sun Healthcare Group, Inc., and SunBridge Carmichael Rehabilitation Center (doing business as Carmichael Care and Rehabilitation Center).
The second set of defendants relates to Edward's two stays at Rosewood Terrace and consists of Carmichael Care, Inc. (doing business as Rosewood Terrace Care and Rehabilitation), North American Health Care, Inc., and John Sorensen.