Elder Abuse: Arbitration Agreements

Daniels v. Sunrise Senior Living, Inc., (Fourth District, January 4, 2013) 212 Cal.App.4th 674, 151 Cal.Rptr.3d 273, 13 Cal. Daily Op. Serv. 250, 2013 Daily Journal D.A.R. 185

A woman whose 93-year-old mother died following her stay at a residential care facility for the elderly filed an action against the owners and operators of the facility, asserting elder abuse and survivor claims as her mother’s successor in interest, and a wrongful death claim on behalf of herself as an individual. The Plaintiff alleged that her mother, who had been suffering from dementia with psychosis, had received inadequate treatment at the facility, resulting in injuries which ultimately led to her death.

The defendants petitioned the trial court to compel arbitration of the claims pursuant to an arbitration clause in a “residency agreement” which had been signed by the plaintiff as her mother’s attorney in fact. Although it had not been signed by the plaintiff in her personal capacity, the agreement nevertheless purported to cover all claims regarding the mother’s care, and to bind all of her heirs and representatives. The trial court denied the petition to arbitrate, finding that as a third party to the arbitration agreement in her capacity as an individual, the plaintiff could not be compelled to arbitrate her wrongful death claim, and that there was a possibility of conflicting rulings on common issues if the survivor claims were arbitrated but not the wrongful death claim. The court of appeal affirmed, holding that there was no basis to infer that the plaintiff had agreed to arbitrate the wrongful death claim:

“Because Daniels signed the residency agreement solely as Barcenas’s agent and not in her personal capacity, there is no basis to infer that Daniels agreed to arbitrate her wrongful death claim. In context, the provision making the arbitration clause binding on heirs means only that the duty to arbitrate the survivor claims is binding on Barcenas and other persons who would assert the survivor claims on her behalf, namely, her “spouse, heirs, representatives, executors, administrators, successors, and assigns, as applicable.” The agreement does not indicate an intent to bind third parties with claims independent of the survivor claims, such as wrongful death claimants.
. . .
[T]he arbitration clause in Barcenas’s residency agreement with Sunrise Senior Living, Inc. is not manifestly intended to bind third party wrongful death claimants. Rather, the clause is directed solely to “your” claims, that is, Barcenas’s claims, and does not mention or allude to wrongful death or other third party claims. And in context, the statement that the arbitration clause “binds all parties to the Agreement and their spouse, heirs, representatives, executors, administrators, successors, and assigns as applicable,” means only that the clause is binding on persons who would assert survivor claims on behalf of Barcenas.
. . .
[W]ith RCFE’s there is a heightened danger, not present in the medical malpractice or health care provider context, that a person may enter into an arbitration agreement without knowingly waiving his or her right to a jury trial on health care-related claims, or their heirs’ derivative wrongful death claims.
. . .
[I]f the survivor claims but not the wrongful death claim were ordered to arbitration. (§ 1281.2(c).) Indeed, if the survivor claims are ordered to arbitration but Daniels’s wrongful death claim was not, there is a possibility of inconsistent rulings on the claims given that the claims are based on the allegation that Barcenas received inadequate care at Sunrise. . . . Because the trial court’s discretionary ruling does not exceed the bounds of reason, we will not disturb it.”