Carter v. Ssc Odin Operating Co., LLC

• Decision Date: 04 April 2008
• Docket Number: No. 5-07-0392.,5-07-0392.
• Citation: 885 N.E.2d 1204,381 Ill.App.3d 717
• Parties: Sue CARTER, Special Administrator of the Estate of Joyce Gott, Deceased, Plaintiff-Appellee, v. SSC ODIN OPERATING COMPANY, LLC, d/b/a Odin Healthcare Center, Defendant-Appellant.
• Court: United States Appellate Court of Illinois

885 N.E.2d 1204

381 Ill.App.3d 717

Sue CARTER, Special Administrator of the Estate of Joyce Gott, Deceased, Plaintiff-Appellee, v. SSC ODIN OPERATING COMPANY, LLC, d/b/a Odin Healthcare Center, Defendant-Appellant.

No. 5-07-0392.

Appellate Court of Illinois, Fifth District.

April 4, 2008.

W. Jeffrey Muskopf, Lashly & Baer, P.C., St. Louis, MO, for Appellant.

Staci M. Yandle, The Law Offices of Staci M. Yandle, LLC, Belleville, IL, for Appellee.

Justice SPOMER delivered the opinion of the court:

The defendant, SSC Odin Operating Company, LLC, doing business as Odin Healthcare Center, appeals an order of the circuit court of Marion County denying the defendant's motion to compel arbitration in the present lawsuit brought by the plaintiff, Sue Carter, as the special administrator of the estate of Joyce Gott, deceased. For the reasons that follow, we affirm the order of the circuit court.

BACKGROUND

The facts necessary to our disposition of this appeal are undisputed by the parties and are as follows. The plaintiff, Sue Carter, is the special administrator of the estate of Joyce Gott, deceased. Joyce was a resident of the defendant's facility, Odin Healthcare Center (Odin), in Odin, Illinois, from May 20, 2005, until July 29, 2005, and again from January 12, 2006, until her death on January 31, 2006. At the outset of Joyce's first stay at Odin, the plaintiff, acting not on her own behalf, but as Joyce's legal representative, executed a written "Health Care Arbitration Agreement" with the defendant; at the outset of Joyce's second stay at Odin, Joyce executed a second written "Health Care Arbitration Agreement" with the defendant, the terms of which are identical to those of the first agreement. In pertinent part, the two "Health Care Arbitration Agreements" (the agreements) require that all disputes between Joyce and the defendant related to Joyce's care at Odin be submitted to binding arbitration. By their own terms, however, the agreements do not apply "to any dispute where the amount in controversy is less than two hundred thousand ($200,000.00) dollars." Within the agreements, Joyce and the defendant expressly agree that the agreements will be governed by the Federal Arbitration Act (9 U.S.C. § 1 et seq. (2000)).

Following Joyce's January 31, 2006, death, the plaintiff filed, on November 22, 2006, the instant two-count lawsuit, alleging in count I a statutory survival action pursuant to the Probate Act of 1975 (755 ILCS 5/27-6 (West 2006)) and the Nursing Home Care Act (210 ILCS 45/1-101 et seq. (West 2006)) (the survival action) and in count II a statutory action under the Wrongful Death Act (740 ILCS 180/0.10 et seq. (West 2006)) (the wrongful death action). In both counts, the plaintiff alleged that the defendant had failed to provide adequate and properly supervised care as needed by Joyce. In the survival action count, the plaintiff alleged that the defendant's acts and/or omissions resulted in Joyce suffering pain and suffering, emotional distress, and mental anguish between January 12, 2006, and January 31, 2006. In the wrongful death action count, the plaintiff alleged that the defendant's acts and/or omissions resulted in Joyce's death and therefore the loss of Joyce's companionship and society for her heirs.

On December 26, 2006, the defendant filed an answer to the plaintiff's complaint, denying in pertinent part the allegations therein and asserting a number of affirmative defenses, including the defense that both counts of the lawsuit were precluded by the agreements, which required the disputes contained therein to be resolved by binding arbitration. On January 11, 2007, the plaintiff filed a reply to the affirmative defenses, denying them, and filed a motion to strike a number of the defenses, which are not relevant to this appeal. On March 5, 2007, the defendant filed a motion to compel arbitration, a memorandum of law in support of that motion, a copy of each of the agreements, and an affidavit of an employee of the defendant that sets forth facts that the defendant alleges establish that the agreements involve interstate commerce within the meaning of the Federal Arbitration Act. On April 19, 2007, the plaintiff filed a memorandum of law in opposition to the motion to compel arbitration. In that memorandum and in a supplemental memorandum filed by the plaintiff on June 20, 2007, the plaintiff argued, inter alia, that (1) a violation of public policy is a legitimate generally applicable defense to all contracts in Illinois, (2) legitimate generally applicable state defenses to all contracts are not preempted by the Federal Arbitration Act, and (3) the agreements are in violation of this state's public policy, as set forth in sections 3-606 and 3-607 of the Nursing Home Care Act (210 ILCS 45/3-606, 3-607 (West 2006)), and so are void.

On June 20, 2007, the trial judge entered an order denying the defendant's motion to compel arbitration. With regard to the wrongful death action, the judge reasoned that although Joyce was bound by the agreements with regard to her own claims, a plaintiff bringing a wrongful death claim on behalf of an estate was not bound by the agreements. With regard to the survival action, the judge concluded that the agreements were not enforceable because they were "in direct violation of emphatically stated public policy and for lack of mutuality" and because, with regard to interstate commerce, "in the aggregate the economic activity does not represent general practice subject to federal control." A timely notice of interlocutory appeal was filed by the defendant, and this appeal followed.

STANDARD OF REVIEW

An order to compel arbitration is injunctive in nature and is appealable under Supreme Court Rule 307(a)(1) (188 Ill.2d R. 307(a)(1)). Peach v. CIM Insurance Corp., 352 Ill.App.3d 691, 694, 287 Ill.Dec. 701, 816 N.E.2d 668 (2004) (citing Salsitz v. Kreiss, 198 Ill.2d 1, 11, 260 Ill. Dec. 541, 761 N.E.2d 724 (2001)). Generally, the standard employed in reviewing an interlocutory order granting or denying a motion to compel arbitration is whether the circuit court abused its discretion. Peach, 352 Ill.App.3d at 694, 287 Ill.Dec. 701, 816 N.E.2d 668. However, in an appeal from the denial of a motion to compel arbitration without an evidentiary hearing, the standard of review is de novo. Ragan v. AT & T Corp., 355 Ill.App.3d 1143, 1147, 291 Ill.Dec. 933, 824 N.E.2d 1183 (2005). In the case at bar, there was no evidentiary hearing. Accordingly, we shall review de novo the trial judge's ruling. This court may affirm the judgment of a trial court on any basis warranted by the record. Evans v. Lima Lima Flight Team, Inc., 373 Ill.App.3d 407, 418, 311 Ill.Dec. 521, 869 N.E.2d 195 (2007).

DISCUSSION

On appeal, the defendant contends the trial court erred because (1) the Federal Arbitration Act is preemptive, (2) the agreements involved interstate commerce, (3) the agreements are supported by mutual promises, and (4) the agreements require the arbitration of the wrongful death action. To understand the defendant's preemption argument, we must examine both what the defendant does contend on appeal and what the defendant does not contend on appeal. We begin with the latter. Nowhere in its opening brief or reply brief, and at no time during oral argument, has the defendant contended that a violation of public policy is not a legitimate generally applicable defense to all contracts in Illinois. Accordingly, the defendant has waived the consideration of any argument on that issue. See 210 Ill.2d R. 341(h)(7) (the argument section of the opening brief of the appellant must include, inter alia, "the contentions of the appellant and the reasons therefor, with citation of the authorities and the pages of the record relied on"; points not argued in the opening brief "are waived and shall not be raised in the reply brief, in oral argument, or on petition for rehearing"); Southwestern Illinois Development Authority v. Vollman, 235 Ill.App.3d 32, 38, 175 Ill.Dec. 683, 600 N.E.2d 926 (1992) (a reviewing court is entitled to have the issues clearly defined; it may deem waived issues not sufficiently or properly presented). Moreover, even if the defendant had not waived this issue, there is voluminous case law in Illinois holding that a violation of public policy can be a legitimate generally applicable defense to all contracts in Illinois. E.g., O'Hara v. Ahlgren, Blumenfeld & Kempster, 127 Ill.2d 333, 341-42, 130 Ill.Dec. 401, 537 N.E.2d 730 (1989); Kleinwort Benson North America, Inc. v. Quantum Financial Services, Inc., 181 Ill.2d 214, 226-27, 229 Ill.Dec. 496, 692 N.E.2d 269 (1998). Likewise, nowhere in its opening brief or reply brief, and at no time during oral argument, has the defendant contended that the protections found in sections 3-606 and 3-607 of the Nursing Home Care Act (210 ILCS 45/3-606, 3-607 (West 2006)) — which, we note, were first implemented in 1980, long before arbitration agreements were as prevalent as they are today — are not "emphatically stated public policy." Accordingly, the defendant has waived the consideration of any argument on that issue. See 210 Ill.2d R. 341(h)(7) (the argument section of the opening brief of the appellant must include, inter alia, "the contentions of the appellant and the reasons therefor, with citation of the authorities and the pages of the record relied on"; points not argued in the opening brief "are waived and shall not be raised in the reply brief, in oral argument, or on petition for rehearing"); Southwestern Illinois Development Authority v. Vollman, 235 Ill.App.3d 32, 38, 175 Ill.Dec. 683, 600 N.E.2d 926 (1992) (a reviewing court is entitled to have the issues clearly defined; it may deem waived issues not sufficiently or properly presented).

We turn now to the preemption issue the defendant has sufficiently and properly presented on appeal. Notwithstanding the facts that a violation of public policy can be a...