The Florida Supreme Court on Thursday ruled a patient couldn't be forced to arbitrate disputes with the nursing home he resides in because he didn't sign the underlying contract.
Juan Mendez Sr. and his son sued Hampton Court Nursing Center in Miami after he developed an eye infection while at the nursing home in 2011. The infection required removal of his left eye. Mendez's son signed the contract with the nursing home, but the Supreme Court said there was no evidence Mendez authorized him to do so.
“We would never enforce an admission agreement if a nursing home obtained a resident's signature by threatening the violent destruction of the resident's property unless the resident signed the agreement,” the majority wrote in a 5-2 opinion (PDF). “If we will not enforce a contract when a party agrees under threat or duress, then we should not enforce a contract in the absence of the party's agreement altogether.”
According to the justices, people who don't sign contracts can enforce a contract but they can't be forced to comply with an agreement they never assigned under that same doctrine.
The Mendez estate did not sue to enforce the nursing home contract; rather, they sued over negligence and statutory violations, the opinion said.
The ruling settles a growing disagreement in Florida state courts over the enforceability of arbitration provisions for individuals who didn't sign the underlying contracts. Several state appeals courts had weighed in with varying opinions on the law, and two justices dissented in the Mendez case, saying it “obliterates longstanding Florida contract law.”
Arbitration agreements with nursing homes have also come under fire across the country. In July 2015, the CMS proposed a rule banning the facilities from requiring residents to sign binding arbitration agreements. The rule is currently being reviewed by the Office of Management and Budget and it is anticipated it will be finalized soon.
