George Washington University v. Scott, No. 96-CV-1178.

• Docket Nº: No. 96-CV-1178.
• Citation: 711 A.2d 1257
• Case Date: May 21, 1998
• Court: Court of Appeals of Columbia District

711 A.2d 1257

GEORGE WASHINGTON UNIVERSITY, Appellant,
v.
Juanita J. SCOTT, Appellee.

No. 96-CV-1178.

District of Columbia Court of Appeals.

Argued February 11, 1998.

Decided May 21, 1998.

711 A.2d 1258

Alfred F. Belcuore, with whom Joseph Montedonico and Patricia M. Tazzara, Washington, DC, were on the brief, for the appellant.

Paul M. Higgins, Rockville, MD, with whom Patrick M. Regan, Washington, DC, was on the brief, for the appellee.

Before FARRELL, KING, and RUIZ, Associate Judges.

KING, Associate Judge:

Appellants George Washington University and George Washington University Health Plan ("GWU") appeal rulings by the trial court denying their Motion to Dismiss the Complaint, or in the Alternative for Summary Judgment, and their Motion to Reconsider and Vacate, Alter, or Amend. GWU argues that a binding arbitration clause contained in a health plan contract bars the trial sought by appellees Juanita S. Scott and Houston E. Ashlock, Jr. ("the Scotts" or "the insureds"), on claims of medical malpractice in the death of their son. For the reasons stated below, we affirm the rulings of the trial court.

I.

The Scotts were employees of the federal government during the relevant times, and as such had access to the Federal Employees Health Benefits Program administered by the Office of Personnel Management ("OPM"). Through this program, they were members of the GWU Health Plan in 1994, a health maintenance organization or "prepaid comprehensive medical plan" providing health care and insurance to its members. Membership in the plan is automatically renewed each year, unless the member opts out pursuant to instructions promulgated by OPM, which also provide: "If you decide NOT to change your enrollment, you do not need to fill out a form. Your enrollment will be continued automatically. . . ." The Scotts allowed their policy with GWU to renew in this manner for January 1995. Any changes in the conditions and coverage of the plan, and in the premium rates paid by the member, took effect on January 1, 1995.

On December 19, 1994, the Scotts' seven-year-old son, who was suffering from a fever and other symptoms, was taken to GWU Pediatrics Center for treatment. After examination and testing, he was sent home with treatment instructions.¹ The boy's condition worsened, however, and, after his parents took him to Children's National Medical Center, he died on the morning of December 20,

711 A.2d 1259

1994. One year later, the Scotts filed the instant wrongful death and survival civil action against GWU, alleging medical malpractice by the GWU treatment staff.²

GWU filed its motion to dismiss or for summary judgment on February 5, 1996, arguing that a valid binding arbitration clause, which was part of the health plan agreement covering the Scotts, deprived the court of jurisdiction over this dispute. The clause mandating binding arbitration was added to the agreement effective January 1, 1995, and read in its entirety:

Any claim for damages for personal injury, mental disturbance or wrongful death arising out of the rendition or failure to render services under this contract must be submitted to binding arbitration.

This clause appeared twice in the twenty-four pages of the 1995 agreement, once under the heading "General Limitations" and once under the heading "How the George Washington University Health Plan Changes January 1995." The 1995 agreement with the arbitration clause was distributed to plan members in November 1994. It is uncontested that the 1994 health plan agreement contained no arbitration provision relating to claims such as this one.

The trial court denied GWU's motion to dismiss or for summary judgment on June 3, 1996. In its order, the court stated that "it is uncontroverted that the purported binding arbitration provision at issue did not become effective until January 1, 1995," and that "there is no indication in the 1995 health plan contract that the purported binding arbitration provision should be construed to apply retroactively to medical treatment rendered prior to January 1, 1995." The trial court also ruled that "the language in the arbitration clause refers to claims arising out of `this contract' which the Court interprets to mean the 1995 health plan contract." The court denied GWU's timely motion for reconsideration, filed pursuant to Super. Ct. Civ. R. 59(e), on June 20, 1996, and this appeal followed.³

II.

GWU contends that the long-standing "presumption in favor of arbitration" requires the court to order arbitration in this case. A long line of cases in this jurisdiction favors this presumption when there is an ambiguity in "the interpretation or construction of an agreement containing an arbitration clause." Masurovsky v. Green, 687 A.2d 198, 200 (D.C.1996). The rule in this jurisdiction is that "where the contract contains an arbitration clause, there is a presumption of arbitrability in the sense that an order to arbitrate the particular grievance should not be denied unless ... the arbitration clause is not susceptible of an interpretation that covers the asserted dispute." Id. at 201-02 (citing Carter v. Cathedral Ave. Coop., Inc., 566 A.2d 716, 717 (D.C.1989)).

GWU also argues that the trial court misconstrued the nature of the health plan agreement. In its order, the trial court found that there were two separate contracts, one providing coverage for 1994 and one providing coverage for 1995. In the trial court's view only the latter agreement, taking effect on January 1, 1995, included a valid arbitration clause which, the court ruled, could not be applied "retroactively" to claims arising from events taking place in 1994 under the 1994 agreement, even if the action was not brought until 1995. In response, GWU argues that the 1994 and 1995 health plan agreements are not "successive, multiple contracts," but rather a single contract subject to subsequent modifications. As there is no controlling precedent in the District of Columbia, GWU cites Maryland case law to the effect that "the renewal of an insurance policy is not a new contract, but an extension of the policy's life when made pursuant to a policy provision concerning renewal." Benner v. Nationwide Mut. Ins. Co., 93 F.3d 1228, 1238 (4th Cir.1996) (citing Maryland law); see also World Ins. Co. v. Perry, 210 Md. 449, 124 A.2d 259, 262 (1956). GWU

711 A.2d 1260

asserts that, as a modification of the Scotts' contract with the health plan, the arbitration clause is valid and binding. Therefore, GWU argues that because the claim...