Everything You Need to Know about Nursing Home Arbitration Clauses
One of the biggest dirty secrets in the nursing home industry is the lawsuit waiver clause hidden in many residency contracts. When Mom moves into a skilled nursing facility there is a good chance she waived her right to sue in the event the nursing home is negligent or fails to provide proper care.
The 7th Amendment to the U.S. Constitution says, “In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law.” That amendment was written in the 1700’s just after the birth of our nation. In simple terms, it means citizens have a right to have their case heard by a jury.
Recent court cases have said that private parties can waive their right to a jury trial and nursing homes have been quick to hop on board and change their contracts to prevent residents from suing. Many contracts today for new residents say that in order to move in, you give up your right to a trial. Instead, you agree that any disputes will be decided by private arbitration.
Is private arbitration fair? If it was completely neutral, most nursing homes wouldn’t be so quick to require disputes be heard by arbitration!
Many if not most consumer contracts now have arbitration clauses. Do you want to sue your credit card company? You probably have to arbitrate. Not happy with Uber? Arbitrate. Not happy that your boss sexually harassed you? Check your employment contract.
With nursing homes, the questions are more complex. Not all people moving into nursing homes are of sound mind. Can grandpa even knowingly waive his rights? What about the contract signed by a family member? Does it bind the person actually living in the facility?
We have been on the forefront of these battles in recent years. In our opinion, an arbitration panel is more conservative and less likely to award punitive damages. (See our cornerstone post on nursing home arbitration clauses for more information.)
Recently a South Carolina appeals court ruled in favor of a family who filed a suit on behalf of their grandmother who was killed by an alligator when she wandered away from a Brookdale Senior Living facility.
The tragic story begins in June 2016. 90 year old Bonnie Walker moved into the Brookdale West Ashley, a senior living facility in Charleston, South Carolina. Just six weeks later she slipped out. No one noticed her disappearance until the next morning.
A search of the ground found Bonnie dead. Unfortunately, it was Bonnie’s granddaughter, Stephanie Weaver, who found her dismembered body. She had been killed by an alligator.
It appears this was the first report of anyone killed by an alligator in South Carolina.
Stephanie sued Brookdale for negligence, negligent infliction of emotional distress, and intentional infliction of emotional distress. The nursing home, fearing what a jury might do, asked the court to compel arbitration. They say that Bonnie Walker contract contained a mandatory arbitration provision in which Bonnie gave up the right to sue.
The legal issue for the court was whether Bonnie’s waiver of her right to a jury trial was made knowingly and whether the agreement was binding on family members.
The trial court refused to send the case to arbitration. Brookdale appealed. On July 29, 2020, the South Carolina Court of Appeals sided with the family. They ruled the nursing home couldn’t move Stephanie’s lawsuit to arbitration. She had the right to her day in court.
At issue in the appeal was the precise wording of the arbitration language*. It said, that it "binds third parties not signatories to this Arbitration provision" including "family members, or other persons claiming through the Resident, or persons claiming through the Resident's estate, whether such third parties make a claim in a representative capacity or in a personal capacity."
*Bizarrely, the arbitration agreement said that the elderly Bonnie Walker could terminate the agreement if she gave "written notice in the event of your death." We are still scratching our heads as to how a dead person could provide written notice.
Had Stephanie merely filed a suit for her grandmother’s pain and suffering, the outcome might have been different. Here Stephanie claimed that Weaver's claims arise from the duties that arose when the nursing home failed to locate Bonnie; called Bonnie's family, including Stephanie, to notify them of Bonnie's disappearance; enlisted Stephanie's help in searching for her; and failed to warn Stephanie of the danger of the alligator pond. Those duties do not flow directly from the residency agreement.
In the words of the court, “[Stephanie] Weaver has not ‘exploited’ or otherwise sought to enforce or benefit from the residency agreement, any more than a pedestrian run over by a truck has benefited from the contract for the purchase of the truck.”
The court never had to rule on Bonnie’s capacity to understand or knowingly waive her rights.
Stephanie’s case can now proceed to trial. We are hoping that a jury will hold Brookdale accountable. The alligator was killed by Department of Natural Resources personnel.
Are You the Victim Of Nursing Home Neglect?
We don’t expect to hear from anyone whose loved one was attacked by a wild animal while at a nursing home. Unfortunately, preventable injuries and deaths are a daily occurrence at nursing homes. Our team of nursing home neglect lawyers and our nationwide network represent residents of nursing homes, assisted living facilities and hospices. We also accept cases from families of those residents as well as homebound patients who were neglected or abused by a homecare service. Our mission is simple, we protect our older and disabled clients.
To learn more, visit our nursing home abuse information page. Ready to see if you have a case? Contact us online, by email [hidden email] or by phone at 833-201-1555. Simply because you are in a nursing home doesn’t mean you must suffer poor care.
[This post is about mandatory arbitration clauses in nursing home contracts. The secondary theme, the nursing home's liability when a patient elopes or wanders away unattended is covered in a different post, Is a Nursing Home Liable When a Residents Elopes or Wanders Away?]