In its decision filed on October 21, 2016, the Supreme Court of Iowa (“Iowa Supreme Court”) held that under Iowa law, adult children’s loss-of-consortium claims are not arbitrable just because the wrongful-death action is otherwise arbitrable in a nursing home case where the nursing home resident’s son signed an arbitration agreement with the nursing home at the time of admission that specified that claims against the nursing home would be resolved by arbitration.
The Underlying Facts
On November 27, 2013, a 79-year-old man was admitted to the defendant Iowa nursing home. On December 12, 2013, the man’s son signed an admission agreement with the defendant nursing home relating to his father’s stay. Both the man’s son and his daughter held general healthcare powers of attorney for their father.
Part of the nursing home admission documentation was a separate two-page document entitled “RESOLUTION OF LEGAL DISPUTES” that subjected disputes to arbitration instead of litigation in court. The son checked a box that stated that he elected to arbitrate disputes and then signed and dated the arbitration agreement.
The father died on August 14, 2015 after which his son and daughter, as co-executors of his estate and on behalf of themselves and their siblings, filed a nursing home wrongful death lawsuit against the nursing home in which they alleged that the defendant nursing home’s care of their father was negligent and caused him personal injury, illness, harm, and eventual death. The defendant nursing home removed the case to federal court based on diversity of citizenship and then moved to compel arbitration.
On December 7, 2015, the United States District Court for the Northern District of Iowa filed a memorandum opinion that directed that the claims of the father’s estate be submitted to arbitration but asked the Iowa Supreme Court to answer two certified questions of Iowa law relating to the adult children’s loss-of-consortium claims. The first certified question was, “Does Iowa Code section 613.15 require that adult children’s loss-of-parental-consortium claims be arbitrated when the deceased parent’s estate’s claims are otherwise subject to arbitration?”
The Iowa Supreme Court’s Decision
When a person dies due to the wrongful or negligent act of another, Iowa law authorizes the personal representative to commence a wrongful death action on behalf of the estate. Code §§ 611.20, 611.22, and 633.336 and their predecessors have consistently been held to vest the right to recover wrongful death damages exclusively in the estate representative.
Iowa also recognizes a cause of action for loss of consortium. Iowa Code section 613.15 empowers the administrator of a parent’s estate, rather than the children, to bring an action for the children’s loss of the parent’s services: in the case of a parent’s death, the child’s claim for loss of parental consortium should be brought by the decedent’s administrator under section 613.15.
The Iowa Supreme Court stated that although the personal representative normally files both claims, there is a critical difference between the wrongful death cause of action and the consortium cause of action. In the latter, damages are to be distributed by the trial court to the children under section 633.336.
However, there is an exception to the rule that either the parent or—in the case of the death—the administrator or executor of the parent’s estate must commence an action to recover damages for loss of consortium: there may be cases where joinder of claims is feasible, yet it is not in the best interests of a minor or adult child that the injured parent bring or control the action. In a prior case, the Iowa Supreme Court recognized an exception to Iowa Code section 613.15 for circumstances when it is impossible, impracticable or not in the child’s best interest for the parent to maintain the action, which would apply when the parent had commenced an action without including the adult children’s consortium claims.
The Iowa Supreme Court agreed with the federal court that when a personal representative brings a wrongful-death action against a party with whom the decedent entered into a binding arbitration agreement, the case is subject to arbitration due to the nature of the wrongful-death action in Iowa (unlike the wrongful death statutes in many states, Iowa’s death statutes have always been of the “survival” type that does not create a new cause of action in a decedent’s survivors; rather, it preserves whatever rights and liabilities a decedent had with respect to a cause of action at the time of his death. The cause of action thus preserved is deemed to accrue to the decedent’s estate representative “at the time it would have accrued to the deceased if he had survived”).
The right to recover wrongful-death damages in Iowa is vested exclusively in the estate representative, and the recovery belongs to the estate. The Iowa Supreme Court had to decide whether the loss-of-parental-consortium claim, which belongs to the children but is ordinarily brought by the estate, is subject to arbitration based upon the decedent’s agreement to arbitrate.
The Iowa Supreme Court held, “we do not find the Roth children’s consortium claims subject to arbitration under the facts certified to us. These claims belong to the adult children, and they never personally agreed to arbitrate … While loss-of-consortium claims under Iowa Code section 613.15 could be subject to arbitration, a decedent’s arbitration agreement alone is an insufficient basis for this outcome.”
The Iowa Supreme Court reasoned that the child owns the cause of action and the personal representative is “merely the conduit, the nominal plaintiff,” when bringing the child’s consortium claim under Iowa Code section 613.15. Furthermore, even if the Iowa Supreme Court held that consortium claims brought by a personal representative were subject to the decedent’s arbitration agreement, the children would have an easy way to avoid arbitration: as the Iowa Supreme Court held in a prior case, if the statutory plaintiff has already commenced an action omitting the claims of a child, the child may bring the consortium claim directly – lawyers could sidestep arbitration simply by the expedient of filing a wrongful–death claim without including any consortium claim, then later filing a consortium action in court naming the children as plaintiffs.
The Iowa Supreme Court also noted that in jurisdictions where the wrongful death claim belongs to the survivors but is brought by the personal representative, courts regularly hold that the decedent’s arbitration agreement does not lead to arbitration of the wrongful-death case. In the present case, the situation is somewhat analogous: under Iowa law, one party owns the claim, but a different party gets to file it.
While the Iowa Supreme Court has in the past characterized the loss of consortium cause of action as “derived” and not “independent,” it meant that the consortium cause of action is derived from a statute, not that it is derivative of the decedent’s rights and therefore subject to the decedent’s litigation-related agreements.
The Iowa Supreme Court concluded, “For all these reasons, we determine that under Iowa law, adult children’s loss-of-consortium claims are not arbitrable just because the wrongful-death action is otherwise arbitrable.”
Source Roth v. The Evangelical Lutheran Good Samaritan Society, No. 15-2095.
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