Flores v. Evergreen at San Diego, LLC

• Decision Date: 13 March 2007
• Docket Number: No. D048002.,D048002.
• Citation: 55 Cal.Rptr.3d 823,148 Cal.App.4th 581
• Court: California Court of Appeals Court of Appeals
• Parties: Josephina FLORES et al., Plaintiffs and Respondents, v. EVERGREEN AT SAN DIEGO, LLC, Defendant and Appellant.

55 Cal.Rptr.3d 823

148 Cal.App.4th 581

Josephina FLORES et al., Plaintiffs and Respondents, v. EVERGREEN AT SAN DIEGO, LLC, Defendant and Appellant.

No. D048002.

Court of Appeal, Fourth District, Division 1.

March 13, 2007.

Beach Whitman, Thomas E. Beach, Sean D. Cowdrey, Camarilla, and Melinda Belew Owen, Carlsbad, for Defendant and Appellant.

Ramírez & Rodriguez, Manuel L. Ramírez, San Diego, and Alejandro Morales; The Ramirez Law Firm and Manuel L. Ramirez for Plaintiffs and Respondents.

HALLER, J.

Evergreen at San Diego, LLC (Evergreen) appeals from an order denying its petition to compel arbitration of the civil action filed by Luis and Josephina Flores against Evergreen. Luis signed an arbitration agreement when admitting his wife, Josephina, into Evergreen's skilled nursing facility. We conclude Luis did not have authority to bind his wife to the arbitration agreement. Accordingly, we affirm the order.

FACTUAL AND PROCEDURAL BACKGROUND

In May 2004, Josephina Flores, Who was suffering from dementia and other ailments, was admitted to Evergreen's skilled nursing facility. As part of the admission process, Luis Flores, Josephina's husband, signed various documents provided by Evergreen. These included two arbitration agreements. The arbitration agreements provide for the use of arbitration in lieu of a lawsuit to resolve medical malpractice claims and other disputes arising from the facility's provision of services.

When a patient is admitted to a skilled nursing facility, the patient or the patient's representative must sign a standard admission agreement. (Health & Saf.Code,¹ § 1599.61, subd. (a).) If the facility requests that the patient agree to arbitration, this provision cannot be included in the standard admission agreement. Instead, it must be set forth in a separate document with a separate signature line. (§ 1599.81, subd. (b).) Consistent with this statutory mandate, the arbitration agreements signed by Luis were on forms separate from the admission agreement. The signature lines on the arbitration agreements state: "Legal Rep/Responsible Party/Agent." On the admission agreement Luis signed a line designated "[a]gent"; on other admission documents he signed lines variously designated "[l]egal [representative" or "[responsible Marty."

At the time he signed these documents, Luis did not have a power of attorney to act for Josephina, nor had he been declared her conservator or guardian. Approximately nine months later, in February 2005, Josephina signed a power of attorney giving Luis authority over a variety of matters, including "[c]laims and [litigation."

On August 22, 2005, Josephina and Luis filed a civil complaint against Evergreen, alleging negligence and several other causes of action. According to the allegations in the complaint, on January 19, 2005, Evergreen staff allowed Josephina to fall to the floor, resulting in a leg fracture, and then failed to provide her medical treatment for approximately 24 hours. Luis pleaded a loss of consortium cause of action.

In December 2005, based on the arbitration agreements signed by Luis, Evergreen filed a petition to compel arbitration. The Floreses opposed the petition, asserting that Luis "did not have any legal authority to waive [Josephina's] right to trial by jury by allegedly signing an arbitration agreement." The Floreses asserted that Luis's authority on behalf of his wife extended only to making medical decisions for her as provided under California law, and that waiver of a jury trial is not a medical decision. Evergreen responded that given his wife's dementia, Luis represented himself as his wife's agent, as shown by his conduct of signing all the admission papers on her behalf, and that Josephina "allowed [Evergreen] to believe that [Luis] had the authority to act on her behalf." Evergreen also asserted that Luis's status as Josephina's spouse gave him authority to act as her agent.

In January 2006, the trial court denied Evergreen's petition to compel arbitration. The court reasoned there was "no evidence that the purported principal (Josephina Flores) did anything which caused [Evergreen] to believe that her husband was her agent," and thus the "fact that Luis Flores purportedly signed the admission papers on her behalf is irrelevant." The court also rejected Evergreen's assertion that Luis's spousal status conferred authority on him to agree to arbitration.

DISCUSSION

The party seeking to compel arbitration bears the burden of proving the existence of a valid arbitration agreement. (Garrison v. Superior Court (2005) 132 Cal.App.4th 253, 263, 33 Cal.Rptr.3d 350 (Garrison); Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972, 64 Cal.Rptr.2d 843, 938 P.2d 903; Pagarigan v. Libby Care Center, Inc. (2002) 99 Cal.App.4th 298, 301, 120 Cal.Rptr.2d 892 (Pagarigan).) Petitions to compel arbitration are resolved by a summary procedure that allows the parties to submit declarations and other documentary testimony and, at the trial court's discretion, to provide oral testimony. (Engalla, supra, 15 Cal.4th at p. 972, 64 Cal.Rptr.2d 843, 938 P.2d 903; Code Civ. Proc., §§ 1281.2, 1290.2.) If the facts are undisputed, on appeal we independently review the case to determine whether a valid arbitration agreement exists. (Garrison, supra, 132 Cal.App.4th at p. 263, 33 Cal.Rptr.3d 350; Buckner v. Tamarin (2002) 98 Cal.App.4th 140,142,119 Cal.Rptr.2d 489.)

Evergreen asserts the trial court erred in denying its petition to compel arbitration because Luis's status as Josephina's spouse gave him authority to bind her to the arbitration agreements. Reviewing general agency principles and Statutory authority governing nursing homes, we conclude that absent a legislative directive, the spousal relationship alone is insufficient to confer authority to agree to an arbitration provision in a nursing home admission contract.

A. Agency Authority

Generally, a person who is not a party to an arbitration agreement is not bound by it. (Buckner v. Tamarin, supra, 98 Cal.App.4th at p. 142, 119 Cal.Rptr.2d 489.) However, there are exceptions. For example, a patient who signs an arbitration agreement at a health care facility can bind relatives who present claims arising from the patient's treatment. (Mormile v. Sinclair (1994) 21 Cal.App.4th 1508, 1511-1516, 26 Cal.Rptr.2d 725; Bolanos v. Khalatian (1991) 231 Cal.App.3d 1586, 1591, 283 Cal.Rptr. 209.) Further, a person who is authorized to act as the patient's agent can bind the patient to an arbitration agreement. (Garrison, supra, 132 Gal. App.4th at pp. 264-266, 33 Cal.Rptr.3d 350; see Buckner, supra, 98 Cal.App.4th at p. 142,119 Cal.Rptr.2d 489.)²

In Garrison, the court held that a daughter who had a durable power of attorney to make health care decisions for her mother could bind her mother to an arbitration agreement in a residential care facility's admission documents. (Garrison, supra, 132 Cal.App.4th at p. 265, 33 Cal. Rptr.3d 350.) The Garrison court reasoned that the decision whether to accept an arbitration provision in the admission documents was "part of the health care decisionmaking process" authorized in the durable power of attorney for health care. (Id. at p. 266, 33 Cal.Rptr.3d 350.)

Here, Josephina did riot sign the arbitration agreements; thus, this is not a case where & signatory patient binds his or her spouse who asserts a claim derived from the patient's care. Further, unlike the situation in Garrison, at the time Luis signed the arbitration agreements he did not have a power of attorney authorizing him to act as Josephina's agent. Thus, there was no written instrument conferring agency power on Luis.

Even when there is no written agency authorization, an agency relationship may arise by oral consent or by implication from the conduct of the parties. (Vant's Rood y. County of Santa Clara (2003) 113 Cal.App.4th 549, 571, 6 Cal. Rptr.3d 746.) However, an agency cannot be created by the conduct of the agent alone; rather, conduct by the principal is essential to create the agency. Agency "can be established either by agreement between the agent and the principal, that is, a true agency [citation], or it can be founded on ostensible authority, that is, some intentional conduct or neglect on the part of the alleged principal creating a belief in the minds of third persons that an agency exists, and a reasonable reliance thereon by such third persons." (Lovetro v. Steers (1965) 234 Cal.App.2d 461, 474-475, 44 Cal.Rptr. 604; Civ.Code, §§ 2298, 2300.) "`"The principal must in some manner indicate that the agent is to act for him, and the agent must act or agree to act on his behalf and subject to his control.". . .' [Citations.] Thus, the `formation of an agency relationship is a bilateral matter. Words or conduct by both principal and agent are necessary to create the relationship . . . ."' (Van't Rood, supra, 113 Cal.App.4th at p. 571, 6 Cal.Rptr.3d 746, italics added.)

Applying these principles, in Pagarigan, supra, 99 Cal.App.4th at pages 301-302, 120 Cal.Rptr.2d 892, the appellate court affirmed the denial of a nursing home's motion to compel arbitration, finding there was no evidence that a comatose mother had authorized her daughters to act as her agents to bind her to a nursing home arbitration agreement. Pagarigan rejected the nursing home's contention that the daughters' act of signing the agreements created agency status, explaining that conduct by the principal was necessary to show the agency. (Ibid.)

In its arguments to the trial court, Evergreen asserted that Josephina allowed it to believe her husband had authority to act for her. However, Evergreen presented no evidence to support this claim. Evergreen presented evidence that Josephina suffers from dementia³ and other ailments, that she was admitted to Evergreen, and that her husband signed the admission documents on her behalf. Although Evergreen presented evidence regarding Luis's conduct,...