Justia Arbitration & Mediation Opinion Summaries

In 2011, 74-year-old Garnell Wilcoxon lived alone. He suffered a stroke, awoke on the floor of his bedroom covered in sweat, feeling sore and with no memory of how he got there. Wilcoxon was admitted to the Troy Regional Medical Center for analysis and treatment for approximately one year before he died. Following Wilcoxon's death, Brenda McFarland, one of Wilcoxon's daughters, filed a complaint as the personal representative for Wilcoxon's estate, asserting claims for : (1) medical malpractice; (2) negligence; (3) breach of contract; (4) negligent hiring, training, supervision, and retention; and (5) loss of consortium. In its answer, Troy Health asserted, in part, that McFarland's claims were barred from being litigated in a court of law "by virtue of an arbitration agreement entered into between plaintiff and defendant." Troy Health then moved to compel arbitration, asserting that forms signed by one of Wilcoxon's other daughters, acting as his attorney-in-fact, contained a valid and enforceable arbitration clause. McFarland argued that "Wilcoxon did not have the mental capacity to enter into the contract with [Troy Health,] and he did not have the mental capacity to give legal authority to enter into contracts on his behalf with" relatives who initially helped admit him to Troy Health facilities when he first fell ill. According to McFarland, "[t]he medical records document that Wilcoxon was habitually and/or permanently incompetent." Therefore, McFarland argued, both a 2011 arbitration agreement and a 2012 arbitration agreement were invalid. The circuit court denied Troy Health's motion to compel arbitration. The Supreme Court reversed, finding that McFarland failed to prove that Wilcoxon was mentally incompetent when he executed a 2012 durable power of attorney naming his other daughter as his attorney-in-fact, and also failed to demonstrate that Wilcoxon was "permanently incompetent" before that date, and because there was no other issue concerning the validity of the 2012 arbitration agreement. View "Troy Health and Rehabilitation Center v. McFarland" on Justia Law

Leo Brown was admitted to the Hattiesburg Health and Rehab Center (HHRC) in February 2012. His wife, Emma, signed an admission agreement both in her individual capacity and on Leo's behalf. Specifically, Emma's signature appears on a line just above the line: "signature of responsible party in his/her individual capacity and on behalf of the resident in the following capacity," where Emma circled the "authorized agent and/or health care surrogate" option. Leo did not sign the agreement. Her husband died soon after his discharge, and she brought a wrongful-death suit against HHRC. HHRC moved to stay the proceedings and to compel arbitration. The trial judge held a hearing on HHRC's motion and denied it, stating: "I do not agree that [Emma] was authorized to sign on Mr. Brown's behalf, and I don't – I do not agree that it is binding on Mr. Brown." The trial judge later entered an order, finding again that the Admission Agreement was not binding on Leo. HHRC appealed, challenging the trial court judgment as to: (1) whether the arbitration provision contained within the Admission Agreement entered between Emma Brown, individually and on behalf of Leo Brown, and [HHRC] created a valid and enforceable agreement to arbitrate; and (2) whether the arbitration provision contained within the Admission Agreement entered between Emma Brown, individually and on behalf of Leo Brown, and [HHRC] was unconscionable. The Supreme Court agreed with the trial court that Leo is not bound by the arbitration provision. And because that issue was dispositive, the Court did not address HHRC's unconscionability argument. View "Hattiesburg Health & Rehab Center, LLC v. Brown" on Justia Law

Nilene Junker was admitted to the Nichols Center nursing facility after surgery. Junker's daughter, acting with power of attorney, signed an admission agreement on Junker's behalf. The admission agreement contained an arbitration clause. While she was being put in a room, Junker fell and sustained injuries. Junker sued the Nichols Center, and the nursing home filed a motion to compel arbitration. The circuit court denied the motion to compel arbitration. The court ruled from the bench without hearing arguments from the parties, holding that the arbitration agreement was not valid and that the "arbitration agreement must fail because it does not make provision for an arbitrator in the event the parties could not agree." The Nichols Center appealed the denial of its motion to compel arbitration. The Supreme Court reversed, concluding the circuit court erred by denying the motion to compel arbitration on the basis of forum unavailability. "The motion to compel asked the court to determine whether the arbitration agreement was valid and enforceable. The court was not asked to rewrite the terms of the agreement to provide for an arbitrator, but rather to compel Junker to comply with the procedures outlined in the agreement. There must be some attempt by the parties to select an arbitrator; then, if the parties cannot agree, the court may be called on to appoint an arbitrator." The case was remanded for a hearing on the motion to compel and a determination of the validity of the arbitration agreement. "If the arbitration agreement is valid, Junker cannot simply refuse to arbitrate." View "NC Leasing, LLC v. Junker" on Justia Law

In this personal injury action arising out of an automobile accident, Robert and Terri Zeller filed a complaint against Charlotte Nixon alleging claims for negligence and loss of consortium. The Zellers submitted their claims for arbitration under Utah Code 31A-22-321, which provides that the election of arbitration stands unless a notice of rescission is filed within ninety days. After the ninety-day rescission period had passed, the Zellers moved to amend their complaint to add a claim for negligent entrustment against Nixon & Nixon, Inc. Nixon opposed the motion to amend and filed a motion to compel arbitration. The district court denied the motion to compel arbitration, concluding that the Zellers were justified in seeking the amendment, thus freeing the Zellers of the statutory limitations on their claims against Nixon and allowing their claims to proceed against Nixon & Nixon. The Supreme Court (1) reversed as to the claims against Nixon, as those claims were irretrievably subject to arbitration given the Zellers’ failure to rescind their election of arbitration within ninety days; and (2) affirmed as to the claims against Nixon & Nixon, holding that the Zellers’ earlier election of arbitration as to their claim against Nixon did not encompass their subsequent claim against the corporation. View "Zeller v. Nixon" on Justia Law

Plaintiff purchased a manufactured home from Defendant. The contract between Plaintiff and Defendant included an arbitration clause. Plaintiff later sued Defendant alleging fraud, negligence, breach of contract, and negligent misrepresentation. Defendant filed a motion to dismiss or to stay the court action and to compel arbitration. Plaintiff opposed arbitration, arguing that the arbitration agreement lacked mutuality and was unconscionable on multiple grounds. The trial court overruled Defendant’s motion. The Supreme Court reversed, holding (1) the agreement’s “anti-waiver clause” was unconscionable and invalid, but the anti-waiver provision could be severed; (2) Plaintiff’s remaining objections did not render the contract as a whole unconscionable; and (3) absent the anti-waiver clause, the contract was not unconscionable. View "Eaton v. CMH Homes, Inc." on Justia Law

This arbitration case stemmed from disputes over Appellee Organizational Strategies, Inc.'s (OSI) captive insurance program, created with Appellants Capstone Insurance Management, Ltd., Capstone Associated Services, and Capstone Associated Services (Wyoming), LP's (collectively, "Capstone") assistance. Appellant PoolRe, managed by Capstone, provided insurance services to OSI's newly created captive insurance companies. Capstone and OSI entered into contracts requiring AAA arbitration, whereas PoolRe and the captive insurance companies entered into contracts requiring ICC arbitration. An arbitrator joined all of the parties for arbitration under AAA rules. Because the arbitrator acted contrary to the express provisions of the PoolRe arbitration agreements, the district court held that arbitrator exceeded his authority and, pursuant to 9 U.S.C. 10, vacated the award. Finding no reversible error, the Fifth Circuit affirmed. View "PoolRe Insurance Corp. v. Organizational Strategies, Inc." on Justia Law

Elisa Zapata died while under the care of the Fredericksburg Care Company, LP, a nursing home. Zapata’s death and survival beneficiaries sued Fredericksburg, alleging negligent care and wrongful death. Fredericksburg filed a motion to compel arbitration based on an arbitration clause contained in an agreement that Zapata signed prior to her admission in the nursing home. The trial court denied the motion to compel arbitration, concluding (1) the pre-admission agreement’s arbitration clause did not comply with Tex. Civ. Prac. & Rem. Code Ann. 74.451 and was therefore invalid; and (2) the McCarran-Ferguson Act (MFA) applied in this case, thus triggering the exemption under which the Federal Arbitration Act (FAA) would not preempt the state statute. The court of appeals affirmed. The Supreme Court reversed, holding that the MFA does not exempt section 74.451 from preemption by the FAA, and the trial court should have granted Fredericksburg’s motion to compel arbitration. View "Fredericksburg Care Co., LP v. Perez" on Justia Law

Entergy Arkansas, Inc. and Entergy Operations, Inc. (collectively, “Entergy”) entered into an agreement with Siemens Energy, Inc. (“Siemens”) under which Siemens was to provide Entergy with services at three nuclear facilities. The agreement included an arbitration provision. Pursuant to the agreement, Entergy and Siemens agreed that Siemens would replace a large component of a generator at Entergy’s Arkansas Nuclear One (“ANO”) facility. Siemens had a separate, long-term agreement with Bigge Crane and Rigging Co. and Claus Frederiksen (collectively, “Bigge”) under which Bigge would prove crane services for Siemens at ANO. After a crane built and operated by Bigge collapsed at ANO, killing one person, injuring ten others, and causing significant damages to ANO, Entergy filed suit against Bigge and others, alleging several tort claims. Bigge moved to compel arbitration of Entergy’s claims against Bigge as a purported third-party beneficiary of the agreement between Entergy and Siemens. The circuit court denied Bigge’s motion. The Supreme Court affirmed, holding that the circuit court did not err in concluding (1) that, under the facts of this case, issues of arbitrability were matters for judicial determination; and (2) that Bigge could not invoke arbitration. View "Bigge Crane & Rigging Co. v. Entergy Ark. Inc." on Justia Law

Harold Stewart, a sergeant in Camden County's Fire Police Department, while operating a Camden County vehicle, was involved in a motor vehicle accident with plaintiff Joseph Vanderslice. Plaintiff filed a complaint against defendants Camden County, the Camden County Fire Police Department, and Stewart, alleging personal injuries sustained as a result of the accident. The case was referred to mandatory, non-binding arbitration, as required by our court rules. An arbitration panel determined that defendants were 100% liable for plaintiff s injuries, and awarded $145,970 for noneconomic damages and lost wages. The next day, defendants submitted the required demand forms to the Camden County Arbitration Administrator. Attached to defendants demand was a payment voucher that gave the recipient the right to draw upon Camden County s account with the State Treasury. The Arbitration Administrator signed the voucher and sent it to the State Treasurer for payment. The Treasurer issued a check thirty days after the arbitration award was filed. Thirty-two days after the award, the Arbitration Administrator received the check. However, because the Arbitration Administrator concluded that the check was not received within thirty days of the arbitration award as required by Rule4:21A-6(b)(1), the clerk did not file the demand or deposit the check. Although Rule1:5-6(c)(1)(A) required the clerk to notify defendants of their error, neither the clerk nor the Arbitration Administrator informed defendants of their nonconforming payment. Rather, defendants were alerted that the demand had not been filed when plaintiff moved to confirm the arbitration award and enter judgment. Defendants opposed the motion and asked the trial court to permit a late filing. Concluding that defendants had substantially complied with the court rules, the court permitted the late filing and rejected plaintiff s motion to confirm the award and enter judgment. The case proceeded to trial and the jury returned a verdict of no cause of action in favor of defendants. Plaintiff appealed, arguing that the trial court should not have permitted defendants late filing, and that the arbitration award should have been confirmed and judgment entered for plaintiff. In an unpublished decision, the Appellate Division determined that defendants demand was filed too late, reversed the trial court, and remanded the matter for entry of an order confirming the arbitration award and entering judgment in plaintiff's favor. Upon review, the Supreme Court concluded defendants demand was not filed out of time. The Appellate Division's judgment was reversed and the jury's verdict was reinstated. Because the Court found that defendants notice was timely, it did not reach the issue of the standard for expanding the thirty-day time limit under Rule4:21A-6(b)(1). View "Vanderslice v. Stewart" on Justia Law

Bell sued attorney Ruben and his firm, alleging that they negligently and fraudulently mismanaged her trust, causing a loss of $34 million. Before arbitration, Ruben filed for Chapter 7 bankruptcy. Bell filed an adversary complaint opposing discharge of Ruben’s fraud-based debt to her, 11 U.S.C. 523(a)(2)(A), (4). The bankruptcy judge granted Ruben a discharge of his other debts, but not of that fraud debt. Ruben’s liability insurance did not cover fraud. Bell settled her negligence claims against Ruben and all claims against the other defendants in arbitration. The arbitration panel ruled, with respect to the fraud claim, that “damages proven to be attributable to the actions of [Ruben] have been compensated,” but ordered Ruben to pay administrative fees and expenses of the American Arbitration Association (AAA) totaling $21,200.00 and that compensation and expenses of the arbitrators, advanced by Bell, totaling $150,304.54 would be borne by Ruben. AAA rules, which governed the arbitration, provide that expenses of arbitration “shall be borne equally” unless the parties agree otherwise or the arbitrator assesses expenses against specified parties. Ruben refused to pay. The bankruptcy judge entered summary judgment in favor of Ruben. The district court reversed, in favor of Bell. The Seventh Circuit affirmed. View "Ruben v. Bell" on Justia Law