Nursing home abuse cases have become a battleground for arbitration-related case law. Here in Florida, there are more appellate decisions deciding whether a long term care case goes to arbitration or litigation than there are opinions interpreting the nursing home statute itself. The fact that the nursing home litigation “boom” has long past yet these arbitration opinions continue to trickle out confirms that the lingering elder law cases still result in fierce legal battles.

Even if you could care less about nursing home law or arbitration, these cases are important since they are interpreting very common durable powers of attorney. A result-oriented decision in one of these long term care cases could skew interpretation of those documents for future cases.

Before we get to the recent case, Carrington Place v. Estate of Crisson, a bit of background on one law firm’s legal strategy to avoid arbitration is warranted. Nursing home admissions typically involve the resident (patient), power-of-attorney, health care surrogate/proxy or a close family member signing the admission agreement. As we’ve mentioned before, there are complex legal arguments over validity when someone other than the power of attorney (POA) signs.

A Tampa area law firm has apparently taken the strategy of still attacking arbitration, even when signed by a POA. In Alterra Healthcare v. Bryant, the Fourth District was called upon to determine that, inter alia, the durable power of attorney document specifically and validly conferred upon the POA the right to arbitrate. In McKibbin v. Alterra Health Care, the Second District found there were limitations in the durable power of attorney which prevented the POA from agreeing to arbitration. Both of those cases involved the same plaintiff firm, which brings us to the present day. What happens if the durable power of attorney document “makes a broad, general grant of authority to the attorney in fact” but does not actually say the words “arbitration” or “waive the right to trial”?

The full name of the Second District’s September 12 decision is Jaylene, Inc.; Candansk, LLC; Dansk Management, Inc.; Arfind America, Inc.; 1521030 Ontario, Inc.; Arlene Angus Christiansen; Find U. Christiansen; Jacqueline F. Hurt; Barbara Gallagher; Kathleen Sylvia; Lynn Taggart; and Paul John Prybylski v. Deborah Moots, as Personal Representative of the Estate of Ethelwin A. Crisson; ACMC-CNH, Inc.; Senior Management Services, Inc.; and Kimberly Ann Gibb (as to Carrington Place). As that is pretty unwieldy, we’ll refer to it as “Carrington Place v. Crisson.”

In this case, the resident was admitted to the long term care facility after the POA signed the admission agreement which contained an arbitration clause. The “optional arbitration clause” is one which other courts have approved before in Consolidated Resources v. Fenelus and Etting v. Regents Park (known in the long term care industry as the “Prestige Printing agreement”).

The court focused only on the durable power of attorney which was “extremely broad and unambiguous.” It stated, “[m]y Agent shall have full power and authority to act on my behalf. This power and authority shall authorize my Agent to manage and conduct all of my affairs and to exercise all of my legal rights and powers, including all rights and powers that I may acquire in the future.”

The court also focused on the POA’s ability to: (1) collect debt, (2) settle any claim, (3) enter into contracts, and (4) have its powers interpreted broadly. Likewise, there was nothing restrictive in Florida Statute 709.08 (Florida’s version Uniform Durable Power of Attorney Act).

With that, the Panel (Wallace, Kelly and Khouzam) teetered between Alterra v Bryant (POA affirmatively authorized to agree to arbitrate) and McKibbin v. Alterra (limitations on POA restrict ability to arbitrate) and concluded, “[w]e are not prepared to state that a grant of the authority to settle claims includes the authority to consent to arbitration. However, the specific grant of the authority to settle claims in the document under review in this case is consistent with the view that the POA’s broad grant of authority includes the power to consent to arbitration.”

Interestingly, the Crisson Panel sounded disappointed with the McKibbin Panel (per curiam) for not spelling out what the “limitations” were in that prior case. We raised the same frustration in our January 24, 2008 post.

Thus, assuming the trifecta of Bryant, Crisson, and McKibbin are to be read together, it appears that durable powers of attorney which (1) explicitly confer the ability to waive trial/agree to arbitrate or (2) make “a broad, general grant of authority to the attorney in fact” result in the POA being authorized to arbitrate. Those POAs with (undefined) “limitations” may not. Given that most durable powers of attorney are explicit or broad, this decision fills the gap between Bryant and McKibbin with precedent favoring enforcement of arbitration.

To read this decision otherwise – or to more restrictively read powers of attorney – could result in unraveling the otherwise valid actions of a POA. Remember, Florida is home to any number of retirees, many of whom come here with durable power of attorney documents from other states. A court being overly restrictive in its interpretation of POA authority, simply for the result of one case, may lead to poor precedent for broader issues.

Perhaps we will have the benefit of further insight from the Second District in the pending cases of Carrington Place v. Estate of Milo or Jaylene v. Marguerite Steuer…