Justia Arbitration & Mediation Opinion Summaries

The decedent resided in Appellants’ long-term skilled nursing care facility between March and August, 2010. Due to the alleged abuse and neglect inflicted upon her throughout her stay, Decedent suffered a multitude of injuries and illnesses that eventually resulted in her death. Appellee filed suit claiming Appellants knowingly sacrificed the quality of care given to their residents. Relevant to this appeal, Appellants filed preliminary objections seeking to enforce an arbitration agreement which Appellee signed, along with general admission paperwork upon Decedent’s admission to the facility. Appellants appealed the Superior Court’s decision affirming, in relevant part, the trial court’s order overruling Appellants’ preliminary objections seeking to compel arbitration and reserving for trial the underlying negligence action filed by Appellee, daughter of the decedent, and executrix of Decedent’s estate. Finding no reversible error, the Supreme Court affirmed the Superior Court and remanded this case to the trial court for further proceedings. View "Wert v. Manorcare of Carlisle" on Justia Law

The litigation resulting in these consolidated appeals stemmed from disputes within the Cohen family. Maurice placed his assets the “Maurice Trust,” and after he died, the trust assets were passed to trust (“the QTIP Trust”), and to a charitable organization (“Fund”). After Maurice’s wife died, the remaining assets of the QTIP Trust rolled over to the Fund. Later, half of the Fund’s assets were given to a new charity, the C-S Foundation (“C-S”). The Fund’s successor, the FPE Foundation (“FPE”) filed this federal case against the Cohens’ two children, one of their spouses, and the advisor to the co-trustees of the QTIP Trust. FPE filed this federal case against members of the Cohen family, alleging that certain Defendants exceeded their powers as co-trustees of the QTIP trust and that the co-trustees’ advisor breached his fiduciary duty to that trust. C-S intervened and counterclaimed against FPE. Defendants filed a motion to dismiss and to compel arbitration, relying on an arbitration clause contained in the Maurice Trust. The district court allowed the motion. The First Circuit affirmed, holding (1) Defendants did not waive their right to arbitration, and thus, dismissal was appropriate; and (2) C-S’s counterclaim was subject to the arbitration clause in the Maurice Trust. View "FPE Found. v. Cohen" on Justia Law

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

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

The McTaggarts filed suit against the former trustee and trust advisor of their family trust, alleging improper handling of their trust funds. The former trustee and trust advisor moved to dismiss the case or have the case stayed pending arbitration, based on an arbitration provision in a wealth-management agreement between the former trustee and trust advisor. The trial court found that, because the McTaggarts did not sign the agreement containing the arbitration provision and because the agreement specifically excluded nonsignatories, including third-party beneficiaries, the arbitration provision was not binding on the McTaggarts. The former trustee and trust advisor appealed. Finding no error, the Supreme Court affirmed. View "Pinnacle Trust Company, L.L.C., EFP Advisors, Inc. v. McTaggart" on Justia Law

The trial judge denied the appellants' motion to compel arbitration on the ground that there was no binding arbitration agreement. The trial judge ruled that Tamera Nelson did not have authority to sign an arbitration agreement on behalf of her grandmother, Arda Lee Churchill (who was a resident of the Grace Living Center-Chikasha until her death), so no valid arbitration agreement existed. The Supreme Court agreed with the trial court that no valid arbitration agreement existed because Tamera Nelson was not authorized to make health care decisions for her grandmother under the circumstances. The Health Care Power of Attorney required that Arda Lee Churchill's physician certify that she was not capable of making her own health care decisions and no such certification was made. View "Johnson v. Convalescent Center of Grady, LLC" on Justia Law

In 2006, Lincoln T. Griswold purchased an $8.4 million life insurance policy. Griswold established a Trust for the sole and exclusive purpose of owning the policy and named Griswold LLP as the Trust’s sole beneficiary. In 2008, the Trust sold its policy to Coventry First LLC. The written purchase agreement contained an arbitration clause. After learning that the policy was sold for an allegedly inflated price that included undisclosed kickbacks to the broker, Griswold sued. Coventry moved to dismiss the case for lack of standing or, in the alternative, to compel arbitration. The district court denied the motion, concluding that both Griswold and the LLP had standing and that the arbitration clause was unenforceable as to the plaintiffs, who were non-signatories. Coventry appealed. The Third Circuit (1) concluded that it lacked appellate jurisdiction to review the district court’s denial of Coventry’s motion to dismiss; and (2) affirmed the district court’s denial of the motion to compel arbitration against the plaintiffs, as they never consented to the purchase agreement. View "Griswold v. Coventry First LLC" on Justia Law

Richard L. Brown and Susan Brown-Thill, co-trustees of the EDB Trust, signed an Arbitration Agreement for resolving a broad range of disputes. These consolidated appeals concern two awards following an initial arbitration. The March 14 award authorized distributions from family-owned limited partnerships to family trusts. The December 12 award declared invalid Brown's attempt to resign as co-trustee and name his successor, and removed Brown as co-trustee, applying the Uniform Trust Code's standards for the statutory removal of a trustee as adopted in Missouri, the situs of the controversy, and Florida, the situs of the EDB Trust. The district court denied Brown's attempt to vacate both awards and Brown-Thill's request for a contractual award of attorneys' fees in both suits. The court concluded that the March 14 award cannot be vacated on the ground of procedural irregularities and the arbitrator's procedural errors did not violate the Federal Arbitration Act (FAA), 9 U.S.C. 10(a)(2), (3), and (4). In regards to the December 12 award, the district court did not err in interpreting the EDB Trust Agreement; the arbitrator's interpretation of the Trust Agreement's removal provision is not a ground for vacating the award; the court concluded that Brown-Thill properly submitted the removal issue under the Arbitration Agreement, the arbitrator then had power to construe and apply the Trust Agreement's removal provision and to make findings regarding the statutory standards for removal which Brown-Thill could present in a judicial proceeding, but the arbitrator exceeded his powers by exercising the exclusively judicial function of removing Brown on statutory standards; however, this decision is of no practical importance because of Brown's unconditional resignation as co-trustee; and the court rejected Brown's FAA challenge. Finally, the court concluded that Brown-Thill was not entitled to recover attorneys' fees. Accordingly, the court affirmed except with a modification and denied Brown's motion to take judicial notice. View "Brown v. Brown-Thill" on Justia Law

THI of New Mexico at Hobbs Center, LLC and THI of New Mexico, LLC (collectively THI) operate a nursing home in Hobbs, New Mexico. When Lillie Mae Patton's husband was admitted into the home, he entered into an arbitration agreement that required the parties to arbitrate any dispute arising out of his care at the home except claims relating to guardianship proceedings, collection or eviction actions by THI, or disputes of less than $2,500. After Mr. Patton died, Mrs. Patton sued THI for negligence and misrepresentation. THI then filed a complaint to compel arbitration of the claims. The district court initially ruled that the arbitration agreement was not unconscionable and ordered arbitration. Under New Mexico law a compulsory-arbitration provision in a contract may be unconscionable, and therefore unenforceable, if it applies only, or primarily, to claims that just one party to the contract is likely to bring. The question before the Tenth Circuit was whether the Federal Arbitration Act (FAA) preempted the state law for contracts governed by the FAA. The Court held that New Mexico law was preempted in this case and the arbitration clause should have been enforced. View "THI of New Mexico at Hobbs v. Patton" on Justia Law

The beneficiary of an inter vivos trust sued the trustee for misappropriation of trust assets and failing to provide an accounting to the trust's beneficiaries. The trustee moved to compel arbitration, relying an arbitration provision contained in the trust. The trial court denied the motion. The court of appeals affirmed, concluding that the provision could not be enforced under the Texas Arbitration Act (TAA) because there was no agreement to arbitrate trust disputes. The Supreme Court reversed, holding that the arbitration provision contained in the trust was enforceable against the beneficiary, as (1) the settlor's intent here was to arbitrate any disputes over the trust; and (2) the beneficiary's acceptance of the benefits of the trust and suit to enforce its terms constituted the assent required to form an enforceable agreement to arbitrate under the TAA. Remanded. View "Rachal v. Reitz" on Justia Law