In the recent case of Smoyer v. Care One, LLC., No. 1417 WDA 2017 (July 25, 2018), the Superior Court held that contractual Arbitration Agreements are to be strictly construed and upheld a lower court’s denial of a Petition to Arbitrate filed by the Defendant.
The Plaintiff’s decedent was a patient at the Defendant’s facility. She became ill and was transferred to a hospital, where she died. The decedent’s son as Administrator of her Estate filed suit alleging negligent care and wrongful death. The Defendant filed a petition asserting an arbitration clause in the “Consent to Treat” signed by the decedent upon admission to the facility. Defendant alleged that the Consent required Plaintiff’s claims be resolved via arbitration. Plaintiff asserted the clause was unenforceable due to a lack of consideration. Also, Plaintiff alleged that the Consent to Treat only authorized the facility to provide treatment and the contract was an unconscionable contract of adhesion.
The Superior Court employed a two-part test:
- Determine if a valid agreement to arbitrate existed, and
- Whether the dispute was within the scope of the agreement.
The Court acknowledged that the law was to favor arbitration to settle disputes. Such agreements were to be strictly construed but not extended by implication. The Superior Court noted the lower court found that there was a valid arbitration agreement. However, the lower court then strictly construed the arbitration clause to apply only for claims that arose out of the Consent to Treat. The lower court noted specific language “…that this Consent to Treat merely constitutes resident’s agreement to permit the rendering of healthcare services prior to the execution of the Admission Agreement.” (emphasis in original). The Superior Court held that the document limited the scope of the Arbitration Clause to arise out of claim with the Decedent’s specific grant of consent, only. Any negligence, custodial neglect, abuse and/or wrongful death claims did not relate to the Consent to Treat. The Court concluded that the limited purpose of the Consent to Treat granted consent to the Facility to provide treatment and was not germane to the issues of negligence pled in the complaint.
Questions on this case can be directed to David Friedman.
