Miller v. Cotter

Decision Date30 March 2007
Citation448 Mass. 671,863 N.E.2d 537
PartiesCharles MILLER, Jr., personal representative,<SMALL><SUP>1</SUP></SMALL> v. Eric COTTER & others.<SMALL><SUP>2</SUP></SMALL>
CourtUnited States State Supreme Judicial Court of Massachusetts Supreme Court

Adam R. Satin, Boston, for the plaintiff.

The following submitted briefs for amici curiae:

Steven H. Schafer, Boston, pro se.

Kenneth A. Behar, Boston, for Massachusetts Extended Care Federation, Inc.



In this case we consider the validity of an arbitration agreement executed in the context of an admission to a nursing home. The plaintiff, Charles Miller, Jr., signed the agreement on behalf of his father as part of his father's admission to Birchwood Care Center (Birchwood) in Fitchburg. Miller's father later died while still a patient at Birchwood. Miller subsequently brought suit against the physician who examined his father at Birchwood (Dr. Eric Cotter); Birchwood; and three Birchwood employees, alleging negligence and wrongful death.

On the basis of the arbitration agreement, Birchwood and its employees (collectively, Birchwood or Birchwood defendants) moved to dismiss the complaint and to compel arbitration. A judge in the Superior Court denied the motion, and Birchwood appealed. Birchwood argues that the judge had no legal basis for declining to enforce the arbitration agreement, and that Federal and State statutes require that it be enforced. We agree and accordingly reverse.3

1. Background. Miller's father was admitted to Birchwood on October 10, 2003. He was ninety-one years old. The elder Miller had been in a series of hospitals, nursing homes, and psychiatric wards over the previous years. His son had authority to make binding agreements on his behalf pursuant to a validly executed durable power of attorney; the younger Miller also held a valid health care proxy for his father.

On the day of his father's admission to Birchwood, Miller, accompanied by his wife, met with social worker Lynn Wilson, who was employed by Birchwood to help manage patient cases. During the meeting, which lasted between sixty and ninety minutes, Miller and Wilson discussed details relevant to the admission, and Miller signed the necessary forms on his father's behalf. These included a sixteen-page admission agreement4 and an agreement providing for the binding arbitration of disputes.

The arbitration agreement was printed within the admission agreement and was presented as a separate document. Execution was not a condition of admission to Birchwood, and that fact was noted in capital letters at the top of the arbitration agreement. The agreement was printed on two single-spaced pages, with one-half of the second page devoted to signatures. It provided, in relevant part:

"[T]he Admission Agreement evidences a transaction involving interstate commerce governed by the Federal Arbitration Act. It is understood and agreed by Facility and Resident that any and all claims, disputes, and controversies . . . arising out of, or in connection with, or relating in any way to the Admission Agreement or any service or health care provided by the Facility to the Resident shall be resolved exclusively by binding arbitration . . . in accordance with the National Arbitration Forum Code of Procedure . . . and not by a lawsuit or resort to court process."

The agreement offered further information about arbitration including contact information for the National Arbitration Forum. It also had a provision allowing the admitted resident to rescind the arbitration agreement unilaterally by giving notice within thirty days of execution. Finally, the arbitration agreement did not limit any remedies available under Federal or State law, but stated that the decisions of the arbitrator "shall be determined in accordance with the provisions of the state or federal law applicable to a comparable civil action."

Miller concedes that he was given a copy of all of the agreements he signed, including the arbitration agreement. In his deposition, Miller testified that during the admission meeting, Wilson "summarized" the agreements, explaining to him that the arbitration agreement was not a precondition of admission, and that its purpose was to put disputes before an arbitrator rather than a court.5 He further testified that he could not recall any specifics about the provisions of the agreements, and that he did not read through all of their terms, word by word. He also testified that he was under great stress at the time of admission and "just wanted to make sure that there was no problem getting dad admitted."6 According to Miller, his stress was not caused by "anything the nursing home was doing" but by "the situation with dad."

Miller showed an understanding of contracts and the language used in them during his deposition. He holds a degree in English from Tufts University, and served as an intelligence officer in the United States Air Force. After leaving the military, Miller spent twenty-seven years in the insurance industry, working as a claims examiner and as a regional claims manager in a variety of divisions of his company (including medical and disability). Because of his work, he had a knowledge of arbitration, and "assume[d]" that his automobile and home insurance policies included arbitration provisions. Miller also showed himself to have an extensive understanding of his rights and responsibilities under both his father's power of attorney and the health care proxy. He had signed admission agreements for his father at several other facilities, and had done the same for his mother. The elder Miller died on November 4, 2003, while still a patient at Birchwood.

2. Prior proceedings. Miller filed this action in the Superior Court on January 13, 2005. The complaint alleged negligence; wilful, wanton, and reckless conduct; and failure to obtain informed consent against both Cotter and the Birchwood defendants. It sought to recover for conscious suffering and wrongful death. The Birchwood defendants filed their answer on April 15, 2005, generally denying the allegations in the complaint and setting up various defenses, including the agreement to submit any dispute to binding arbitration.7

The Birchwood defendants then filed a motion to dismiss, or in the alternative to stay proceedings pending arbitration.8 Because Cotter was neither an employee of Birchwood nor a party to the arbitration agreement, he did not join in this motion. The motion judge allowed a stay of ninety days to permit the parties to conduct discovery limited to the enforceability of the arbitration agreement. Thereafter, each party filed a written memorandum in support of its position and the motion judge heard oral argument on October 12, 2005.

The judge denied the motion without written opinion.9 His order read:

"This motion is DENIED after hearing and upon consideration of the arguments of the parties, I find that to require the plaintiff to arbitrate some part of this claim against the moving party, but not all claims or parties results in an inequitable, [inefficient] and unnecessarily expensive duplication of effort that renders enforcement of this arbitration agreement to be [substantively] and procedurally unfair."

The Birchwood defendants then appealed under G.L. c. 251, § 18 (a) (1), which grants a right of interlocutory appeal from orders denying an application to compel arbitration.10 We transferred the case here on our own motion.

3. Discussion. The Birchwood defendants argue that it was an error of law for the judge to deny their motion to dismiss and to compel arbitration. They cite in support the Federal and Massachusetts Arbitration Acts, claiming that under those Acts a court may only set aside an arbitration agreement for fraud, duress, or unconscionability, none of which is present here. The Birchwood defendants argue further that the judge committed reversible error when, citing judicial convenience, he relied on the existence of a claim against Cotter, who was not a party to the arbitration agreement, to defeat the agreement as between Miller and the Birchwood defendants. We address these arguments in turn.11

a. Standard of review. The judge correctly treated the Birchwood defendants' motion to compel arbitration as one for summary judgment. See G.L. c. 251, § 2(a) (judge shall proceed summarily to determine existence of arbitration agreement). We review a grant of summary judgment de novo, construing all facts in favor of the nonmoving party.12 Augat, Inc. v. Liberty Mut. Ins. Co., 410 Mass. 117, 120, 571 N.E.2d 357 (1991).

b. Statutory framework. The Massachusetts Arbitration Act, St.1960, c. 374, § 1, codified, as amended, at G.L. c. 251 (Massachusetts Act), is this Commonwealth's version of the Uniform Arbitration Act. The Massachusetts Act "expresses a strong public policy favoring arbitration as an expeditious alternative to litigation for settling commercial disputes." Home Gas Corp. of Mass., Inc. v. Walter's of Hadley, Inc., 403 Mass. 772, 774, 532 N.E.2d 681 (1989), quoting Danvers v. Wexler Constr. Co., 12 Mass. App.Ct. 160, 163, 422 N.E.2d 782 (1981). It provides in part:

"A written agreement to submit any existing controversy to arbitration or a provision in a written contract to submit to arbitration any controversy thereafter arising between the parties shall be valid, enforceable and irrevocable, save upon such grounds as exist at law or in equity for the revocation of any contract."

G.L. c. 251, § 1 (validity of arbitration agreement). The Massachusetts Act also allows for proceedings in the Superior Court to compel arbitration in accordance with the terms of an arbitration agreement, and permits an interlocutory appeal from orders denying an application to compel arbitration. See G.L. c. 251, §§ 2, 18.

The Federal government had enacted a similar statute, the Federal Arbitration Act, 9...

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