Nonsignatories: Personal Representative Who Signed Arbitration Agreement With Power Of Attorney And Later Sued For Wrongful Death Cannot Be Forced To Arbitrate

Also, Elder Abuse Claim Does Not Need To Be Arbitrated, Because That Could Lead To Conflicting Rulings.

     Nursing homes and assisted living facilities commonly enter into arbitration agreements with their residents.  Suits by heirs or personal representatives for claims of wrongful death and elder abuse have spawned litigation concerning the enforceability of such arbitration agreements.  Our latest case concerning an assisted living facility, Monschke v. Timber Ridge Assisted Living, LLC, A144289 (1/1 Jan. 29, 2016), affirms the trial court’s order denying Timber Ridge Assisted Living’s petition to compel arbitration.

     Plaintiff Monschke acted as the personal representative for the estate of her mother, the decedent, and filed suit for wrongful death and elder abuse, alleging that her mother was allowed to exit the facility without supervision, fell, was left outside for 30 – 45 minutes, and died of her injuries two weeks later.  Acting under power of attorney, plaintiff had signed an arbitration agreement on behalf of her mother.

      There are two keys to this case.  The first is that the plaintiff was not a party to the arbitration agreement, having signed the agreement with power of attorney, not in her personal capacity. 

       The second key is a distinction that the Court makes between causes of action for wrongful death and for elder abuse.  In California, Code of Civil Procedure section 377.60 “creates a new cause of action in favor of the heirs as beneficiaries, based upon their own independent pecuniary injury suffered by loss of a relative, and distinct from any the deceased might have maintained had he survived.” (quoting Horwich v. Superior Court, 21 Cal.4th 272, 283 (1999).  Thus, the wrongful death claim is in favor of the heirs, rather than in favor of the decedent, who would be bound by an arbitration agreement covering the separate claim of elder abuse.  However, as the heirs were not signatories, nor did they derive their new claim derivatively from the elder abuse claim, they were not compelled to arbitrate the wrongful death claim. 

        However, here, the trial court concluded that, to the extent plaintiff’s wrongful death claim was not subject to arbitration, plaintiff’s elder abuse claim should be tried with it to avoid the risk of conflicting rulings – a finding that the defendant did not challenge.

        COMMENT:  First, note that the distinction between a wrongful death action that is derivative, and a wrongful death action that is a new cause of action is a recondite distinction, for in some jurisdictions, a wrongful death action is derivative.

         Second, if the Federal Arbitration Act applied, plaintiff could be compelled to arbitrate the elder abuse claim, regardless of whether plaintiff could be compelled to arbitrate the wrongful death claim.  Here, however, there was no mention of the FAA, and and in any case, the defendant did not press to separately arbitrate the elder abuse claim.                               

         Third,  I have previously posted about nursing homes and arbitration clauses on April 11, 2012 (Bush v. Horizon West); May 21, 2012 (Bickel v. Sunrise Assisted Living); March 27, 2012 (Marmet Healthcare Center, Inc. v. Brown); January 6, 2013 (Daniels v. Sunrise Senior Living, Inc.); and November 11, 2013 (Goldman v. Sunbridge Healthcare, LLC).