The Court of Appeals of Kentucky has once again refused to compel a nursing home dispute to arbitration.
In Kindred Nursing Centers Ltd. Partnership v. Foley-Townsend, a man appointed his sister as his power of attorney. A power of attorney is a written instrument that authorizes a person to represent or act on another individual’s behalf in business or private affairs. The executed document provided the man’s sibling with the authority to act for him with regard to all of his affairs, including real and personal property matters.
About one year after the man executed the power of attorney, he entered a Bowling Green nursing home. Upon admission, his sister signed an optional agreement to mediate or arbitrate any disputes with the facility. The alternative dispute agreement stated it was subject to revocation by the resident within 30 days and warned that other local nursing homes may not include such a provision.
While the man was living at the facility, his sister filed a personal injury lawsuit against the nursing home in Warren Circuit Court. The skilled nursing facility responded by filing a motion to compel the case to arbitration. The trial court denied the facility’s motion based upon Kentucky Supreme Court precedent. According to the lower court, the man’s sister lacked authority to bind him to an agreement to arbitrate.
The skilled nursing facility then filed an interlocutory appeal with the Court of Appeals of Kentucky. An interlocutory appeal is normally brought in situations when allowing a lawsuit to proceed would be highly prejudicial to one of the parties to the case. According to the appellate court, a party seeking to compel arbitration in Kentucky must show that a valid arbitration agreement exists.
Next, the court stated although both the Kentucky Uniform Arbitration Act and the Federal Arbitration Act favor arbitration, the existence of a valid agreement is determined using state contract law principles. The Kentucky appeals court added that the existence of an agreement to arbitrate does not preempt state contract law.
After that, the court examined the language of the man’s power of attorney document to discern whether his sister was authorized to bind him to arbitrate his claims against the nursing home under Kentucky law. Since his executed document delegated the power to perform specific acts to his sister, the appeals court held the man’s power of attorney was limited to encompass only those acts specified and did not extend to the right to bind him to an alternative dispute resolution agreement.
Finally, the Court of Appeals of Kentucky affirmed the decision of the trial court. If you or a loved one was abused at a Kentucky nursing home, you should discuss your rights with a seasoned personal injury attorney. To speak with a knowledgeable nursing home abuse lawyer, please call English, Lucas, Priest & Owsley, LLP at (270) 781-6500 today or contact us online.
Additional Resources: Kindred Nursing Centers Ltd. Partnership v. Foley-Townsend, Ky: Court of Appeals 2014
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Alternative Dispute Provisions in Nursing Home Agreements, August 8, 2014, Kentucky Personal Injury Attorneys Blog
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