New Mexico Appellate Court Refuses To Enforce Nursing Home Arbitration Agreement

The Court of Appeals of New Mexico (“New Mexico Appellate Court”) held in its unreported opinion filed on May 13, 2020,”Defendants argue that the district court erred in denying their motion to compel arbitration because Mrs. Rosenquist had express or implied authority to sign the Agreement on behalf of Decedent in light of her actions and representations. For the reasons that follow, we disagree.”

The Underlying Facts

Decedent resided at the Facility for a total of eight days before requiring hospitalization. He died later that same month. Mrs. Rosenquist filed a complaint alleging that Decedent suffered from contractures, weight loss, narcotic overdose, medication errors, brain hemorrhage, falls, and bedsores while in Defendants’ care, and that “[he] required medical attention and hospitalization” and later died as a result of these injuries. In response to the complaint, Defendants filed a motion seeking to compel arbitration, among other things. Defendants sought to enforce the Agreement, which waived Decedent’s right to a trial by judge or jury. They noted that the Agreement was “entirely voluntary, stating multiple times that [Decedent] would still receive services even if the Agreement was rejected.” In support of the motion, Defendants attached: (1) the affidavit of the assistant admissions coordinator who presented Mrs. Rosenquist with Decedent’s admission paperwork; the Agreement; the Representative Designation form; and several other admission documents Mrs. Rosenquist allegedly signed on behalf of Decedent.

Mrs. Rosenquist filed a response asserting that Defendants failed to establish the existence of a valid contract because she did not have the authority to agree to arbitration on Decedent’s behalf. She further argued that the Agreement was both procedurally and substantively unconscionable.

The lower court found and concluded: (1) Defendants did not assert that Decedent was incompetent or unable to sign the Agreement at the time of his admission; (2) the Representative Designation form did not legally empower Mrs. Rosenquist to act on Decedent’s behalf because it was incomplete and Mrs. Rosenquist did not provide any document to confirm Mrs. Rosenquist’s authority, contrary to the form’s instructions; (3) Decedent did not sign the Agreement, nor was he identified in the Agreement; and (4) despite language in the Agreement identifying Mrs. Rosenquist as Decedent’s authorized representative, “[Mrs. Rosenquist] was not acting as [Decedent’s] ‘power of attorney,’ ‘legal guardian,’ or ‘authorized agent.’ ” Accordingly, the district court concluded that the Agreement did not bind Decedent’s estate to arbitration. The order did not discuss the issues of procedural or substantive unconscionability.

New Mexico Appellate Court Opinion

The defendants argued that the district court erred in denying their motion to compel arbitration because Mrs. Rosenquist had express or implied authority to sign the Agreement on behalf of Decedent in light of her actions and representations.

The New Mexico Appellate Court held: “Here, it is undisputed that Decedent did not sign the Agreement on his own behalf. Rather,  Mrs. Rosenquist signed the Agreement. Thus, to prove a valid arbitration agreement sufficient to bind Decedent’s estate, Defendants bore the burden of demonstrating that Mrs. Rosenquist had actual or apparent authority to sign the Agreement as Decedent’s agent … The only possible “action” by Decedent to which Defendants could point to meet their burden was his failure to subsequently deny that Mrs. Rosenquist had any authority to sign his admission paperwork. However, it is settled law that a principal cannot ratify a purported agent’s acts through mere inaction unless the principal has full knowledge of the material facts concerning the transaction … Defendants failed to present any evidence that Decedent knew that Mrs. Rosenquist signed his admission documents or the Agreement … Defendants fail to point to any evidence of Decedent’s desire to be admitted to the Facility or that he routinely allowed Mrs. Rosenquist to sign documents on his behalf. Simply put, without any evidence of Decedent’s actions demonstrating that (1) Mrs. Rosenquist was his agent and had authority to sign his admission paperwork, or (2) that he ratified Mrs. Rosenquist’s actions, Defendants failed to meet their burden to establish the existence of a valid arbitration agreement. Accordingly, the district court properly denied Defendants’ motion to compel arbitration.”

Source Rosenquist v. Genesis Healthcare, LLC, No. A-1-CA-36609.

If you or a loved one suffered injuries (or worse) while a resident of a nursing home in New Mexico or in another U.S. state due to a nursing home fall, nursing home aspiration, nursing home neglect, nursing home negligence, nursing home abuse, nursing home under-staffing, or the nursing home failing to properly care for a vulnerable adult, you should promptly find a nursing home claim lawyer in New Mexico or in your state who may investigate your nursing home claim for you and file a nursing home claim on your behalf or behalf of your loved one, if appropriate.

Click here to visit our website to be connected with New Mexico medical malpractice lawyers (nursing home claim lawyers) or nursing home claim attorneys in your U.S. state who may assist you with your nursing home claim, or call us toll-free in the United States at 800-295-3959.

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This entry was posted on Monday, October 12th, 2020 at 5:30 am. Both comments and pings are currently closed.

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