United Health Servs. of Ga., Inc. v. Alexander

• Court: United States Court of Appeals (Georgia)
• Citation: 802 S.E.2d 314
• Docket Number: A17A0335
• Parties: UNITED HEALTH SERVICES OF GEORGIA, INC. et al. v. ALEXANDER et al.
• Decision Date: 22 June 2017

342 Ga.App. 1
802 S.E.2d 314

UNITED HEALTH SERVICES OF GEORGIA, INC. et al.
v.
ALEXANDER et al.

A17A0335

Court of Appeals of Georgia.

June 22, 2017

802 S.E.2d 316

John Ryan Hood, Jason Edward Bring, Sean T. Sullivan, Atlanta, for Appellant.

James Burke McHugh, Douglas Bryant Chaffin, Anthony Lance Reins, Michael J. Fuller, D. Bryant Chaffin, for Appellee.

McFadden, Presiding Judge.

The issue in this appeal is whether the trial court erred in denying a motion to enforce an arbitration agreement. Because the appellants, as the parties seeking arbitration, failed to carry their burden of proving a valid and enforceable arbitration agreement, we affirm.

1. Facts and procedural posture.

On June 12, 2013, Doris Alexander was admitted to PruittHealth-Forsyth nursing home, formerly known as Heritage Healthcare of Forsyth. On or about that same date, Carol Alexander, Doris Alexander's daughter, signed a nursing home admission agreement and other documents, including an optional arbitration agreement naming her mother and the nursing home as parties. The arbitration agreement provided that it was voluntary and not a precondition to admission to the nursing home, that the parties waived the right to a jury trial and instead agreed to have any future disputes between them resolved by binding arbitration, that an arbitration decision would be final and unappealable, that the agreement was governed by the Federal Arbitration Act and not by the Georgia Arbitration Act, and that the patient/resident could revoke the agreement within 30 days of signing it. Carol Alexander signed the agreement on the line designated for the signature of the patient/resident. Doris Alexander was not present when her daughter signed the arbitration agreement, Carol Alexander never showed or discussed the arbitration agreement with her mother, and Doris Alexander never signed the agreement herself.

Doris Alexander remained a resident of the nursing home until she died on February 27, 2014. On May 5, 2015, Jeanette Alexander, another of Doris Alexander's children and administrator of her estate, filed a lawsuit against United Health Services of Georgia, Inc., and other defendants, asserting multiple causes of action, including claims for negligence, wrongful death, and medical malpractice. Based on the arbitration agreement, United Health and other defendants filed a motion to dismiss or, alternatively, to stay proceedings and compel arbitration. After a hearing, the trial court denied the motion, finding that there was no valid and enforceable arbitration agreement because Carol Alexander did not have the authority to sign the arbitration agreement on her mother's behalf. The defendants' application for interlocutory appeal was granted, and this appeal followed.

2. Enforceability of the arbitration agreement.

"Arbitration is a matter of contract, meaning that arbitrators derive their authority to resolve disputes only from the parties' agreement." Brooks Peanut Co. v. Great Southern Peanut, 322 Ga. App. 801, 809 (3), 746 S.E.2d 272 (2013)

802 S.E.2d 317

(citation and punctuation omitted).

Whether a valid and enforceable arbitration agreement exists is a question of law for the court. We therefore review a trial court's order granting or denying a motion to compel arbitration de novo. The [appellants], as the parties seeking arbitration, bear the burden of proving the existence of a valid and enforceable agreement to arbitrate. And the validity of an arbitration agreement is generally governed by state law principles of contract formation.

McKean v. GGNSC Atlanta , 329 Ga. App. 507, 509 (1), 765 S.E.2d 681 (2014) (citations and punctuation omitted). Under Georgia law, to constitute a valid contract, there must be, among other things, "the assent of the parties to the terms of the contract." OCGA § 13-3-1. "Thus, a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit." Brooks Peanut Co. , supra (citation and punctuation omitted). See also TranSouth Fin. Corp. v. Rooks , 269 Ga. App. 321, 324 (1), 604 S.E.2d 562 (2004) (party seeking to enforce arbitration agreement must prove assent to the contractual terms).

In the instant case, Doris Alexander did not personally assent to the arbitration agreement. United Health and the other appellants argue, however, that Carol Alexander had both express and implied authority to act as her mother's agent and sign the agreement on her mother's behalf. Indeed, "[t]raditional principles of agency law may bind a nonsignatory to an arbitration agreement."...