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Kentucky Appeals Court Refuses to Order Arbitration in Nursing Home Negligence, Wrongful Death Case: Kindred Healthcare Inc. v. Butler

file0001532482557 morguefile drummerboyIn an unpublished opinion, the Kentucky Court of Appeals has affirmed a trial court’s order denying arbitration in a nursing home negligence case. In Kindred Healthcare Inc. v. Butler, a woman filed a lawsuit against the nursing home where her father resided prior to his death on behalf of his estate. About four years before the man was admitted to the long-term care facility, he executed a durable power of attorney that provided his daughter with the right to act as his attorney-in-fact and sign documents on his behalf. When the deceased man initially entered the facility, his daughter signed an optional agreement to arbitrate any disputes between the elderly man and the skilled nursing facility.

After the man died, his daughter was named the executrix of his estate. She then filed a lawsuit in Hardin Circuit Court against the nursing home, alleging it had violated her father’s rights, committed medical and other negligence, and caused his wrongful death. In response, the nursing home filed a motion to compel arbitration pursuant to the terms of the contract the woman had signed when her father was first admitted to the facility. The trial court denied the facility’s motion because it found the woman signed the agreement to arbitrate in her capacity as the man’s daughter rather than based upon the power of attorney he provided to her. Additionally, the court determined the language used in the power of attorney was insufficient to provide the man’s daughter with the right to bind him to an arbitration agreement. Finally, the court held that even if the power of attorney was valid it would not force arbitration in the wrongful death case. The skilled nursing facility appealed the circuit court’s decision to the Kentucky Court of Appeals.

On appeal, the Kentucky court stated the lower court’s decision would be overturned only if it was clearly erroneous. Next, the appeals court noted that the nursing home failed to address the validity of the decedent’s durable power of attorney. Still, the court opted to examine whether the power of attorney document at issue was sufficient to compel arbitration.

According to the appeals court, both the Federal Arbitration Act and the Kentucky Uniform Arbitration Act favor arbitration agreements. Despite this, whether or not a valid agreement to arbitrate exists depends on state contract law. Additionally, recent Kentucky Supreme Court precedent held that a woman’s signed power of attorney only authorized her daughter to make financial and medical decisions in her place. The state’s high court found that a signed power of attorney did not authorize the daughter in that case to sign an optional arbitration agreement on her mother’s behalf. The court also said the alternative dispute resolution agreement did not preclude a wrongful death action against the nursing home where the woman died.

Next, the Kentucky Court of Appeals examined the power of attorney involved in the case at hand. The court found that the document was created to allow the man’s daughter to assist him with his property and financial affairs. Despite a catch-all provision, the court held that the power of attorney did not authorize the man’s daughter to enter into any agreements on his behalf. Because the power of attorney document did not provide the decedent’s daughter with the authority to sign an optional arbitration agreement in his place, the Court of Appeals of Kentucky affirmed the circuit court’s decision to deny the nursing home’s motion to compel arbitration.

When a nursing home resident signs an agreement to arbitrate any future personal injury or other claims against the facility where he or she resides, the resident generally gives up the right to trial before a panel of jurors. Increasingly, nursing homes ask or require new residents to sign an optional or compulsory arbitration agreement prior to entering a facility. To protect your constitutional right to a trial before a jury, you should carefully review all nursing home admission documents before signing them.

If you or someone you love was abused, neglected, or worse at a Kentucky nursing home, a seasoned personal injury lawyer can help. To discuss your case with a hardworking nursing home abuse and neglect attorney, please call English, Lucas, Priest & Owsley, LLP at (270) 781-6500 or contact us online.

Additional Resources:

Kindred Healthcare Inc. v. Butler, Ky: Court of Appeals 2014

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