Health Care Cases Continue To Generate Problematic Arbitration Agreements.
The case James Maxwell v. Atria, A168043 (1/1 9/19/24) (Siggins, J.) involves the death of 93-year-old Trudy Maxwell, a resident at Atria Park of San Mateo, who passed away after drinking industrial-strength cleaner mistakenly served by an Atria employee. Trudy's children, including James Maxwell III, filed a lawsuit against Atria, alleging negligence, wrongful death, and elder abuse. A central issue in the case was James III's authority to sign an arbitration agreement on behalf of his mother, as he held a durable power of attorney, while his sister, Marybeth, held the health care power of attorney. The trial court denied Atria's motion to compel arbitration, ruling James III lacked the authority to sign the agreement and the wrongful death claims by Trudy’s heirs were not bound by it. Atria appealed, arguing James III was authorized to sign the arbitration agreement and all claims should be arbitrated.
The Court of Appeal reversed the trial court's denial of the motion to compel arbitration and remanded the case. The appellate court held that it was necessary for the trial court to reconsider the enforceability of the arbitration agreement in light of Harrod v. Country Oaks Partners, LLC, which clarified that signing an arbitration agreement may not constitute a health care decision under a health care power of attorney. The case was sent back for further proceedings to resolve the remaining issues.
COMMENT. In Harrod v. Country Oaks Partners, LLC, the California Supreme Court held signing an optional arbitration agreement with a skilled nursing facility is not considered a "health care decision" under a health care power of attorney. The court reasoned decisions regarding arbitration agreements involve legal rights, including waiving the right to a jury trial, and are distinct from decisions necessary for the patient's well-being or medical care. Therefore, even if a person holds a health care power of attorney, they may not have authority to bind the patient to an arbitration agreement unless the power to make such decisions is explicitly granted. We blogged about Harrod on 7/1/24.
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