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Health Care Proxy Can’t Bind Principal to Arbitration Clause Says Massachusetts Supreme Judicial Court — Johnson v. Kindred Health Care, Inc.

arbitrationOver the past several decades, arbitration clauses have increasingly been used to resolve legal disputes. An Arbitration clause is an agreement between two contracting parties to settle their disputes in arbitration as opposed to going to trial. Their increased use has several justifications including reducing court volume.

It may be strange to find an article about arbitration clauses in a personal injury blog; however, arbitration clauses in personal injury and wrongful death claims have also increased. In 2012, the U.S. Supreme Court decided in Marmet Health Care Center, Inc. v. Brown, that when parties agree to arbitrate personal injury or wrongful death claims under the Federal Arbitration Act (“FAA”), without any other legal issues, those claims must be arbitrated.

Arbitration clauses involving personal injury or wrongful death can be further complicated when a third party signs the contract. This month, the Supreme Judicial Court of Massachusetts (“SCT”) published two companion personal injury and wrongful death cases where an agent with a Health Care Proxy (“HCP”) signed an arbitration clause.

Generally, an HCP is an advanced agreement between a patient and a “health care agent” that allows the agent to make health care decisions for the patient when the patient becomes incapacitated. Massachusetts General Laws Chapter 201D (“201D”) define the rules and requirements for a HCP.

Licata v. GGNSC Malden Dexter LLC
In the first case, Licata v. GGNSC Malden Dexter LLC., Salvatore Licata made the difficult life decision of moving his mother into a nursing home, GGNSC Malden Dexter LLC. (“GGNSC”). Salvatore completed all the admission documents including an arbitration clause. Salvatore had an proxy giving him authority over his mother’s health care decisions; however, his mother’s incapacity had not yet been determined by an attending physician. Under 201D, for an HCP to be effective, it must state the agent’s authority, and incapacity must have been determined by an attending physician. It wasn’t until three weeks after the signing of the arbitration agreement that an attending physician determined incapacity.

The mother suffered personal injuries while in GGNSC’s care, which resulted in her death. Salvatore filed personal injury and wrongful death claims. GGNSC moved to dismiss the claim and compel arbitration pursuant to both the Federal Arbitration Act (“FAA”) and the Massachusetts Arbitration Act (“MAA”). The motion judge ruled that Salvatore lacked the authority needed to sign the arbitration agreement on his mother’s behalf.

The court held that, by the plain meaning of 201D, the authority needed to make health care decisions was not effective until an attending physician determined incapacity. Furthermore, the court failed to find authority that bound Salvatore as a health care agent under several other legal theories including agency law, third party beneficiary, and equitable estoppel.

Johnson v. Kindred Health Care, Inc.
As a companion case, the court examined whether a “health care agent” with a proper HCP would be able to bind a principal to an arbitration clause for personal injury or wrongful death. In Johnson v. Kindred Health Care, Inc. (“KHC”), Barbara Johnson made the tough life decision of placing her husband, Dalton, into a nursing home. Unlike the Licata case, Barbara signed an arbitration agreement as a fully qualified health care agent under section 201D. While in the nursing home, Dalton suffered severe burns and died. Barbara brought a personal injury and wrongful death claim against KHC. A Superior Court judge dismissed the claim, and Barbara requested an appeal. The SCT questioned whether a “health care agent” with a valid HCP had the authority to bind a principal into arbitrating claims of personal injury or wrongful death.

First, the court reiterate the purpose of a HCP under 201D was to support and protect a patient’s autonomy, which requires being free from non consensual invasion of ones body. A HCP allows a principal to designate an agent, prior to incapacitation, to make “health care decisions” about their body that align with the patient’s known interests, morality, and personal beliefs.

The court found that the Legislature intended a “health care agent” with a HCP to have authority only over decisions involving medical treatment, services, or procedures. In addition, the statute distinguishes a “health care agent” from a power of attorney, guardianship, or conservatorship in that they encompass broader decision making authority. Extending the authority of “health care agent” would override the authority of these fiduciaries.

The Supreme Judicial Court of Massachusetts vacated the order compelling arbitration holding that a 201D HCP only authorizes a “health care agent” to make decisions that would require a principal’s informed consent about medical treatment, services, or procedures.

If you or a loved one have been the victim of a personal injury or wrongful death by a medical practitioner or center, you should consult with an experienced medical malpractice attorney to protect your rights and get the compensation you deserve.

Local attorney, John C. Manoog III, has extensive experience handling personal injury or wrongful death claims. For a free initial consultation, call the office at 888-262-6664 or reach us by email. There is always someone available to talk to you about your case.

Related Blog Posts:
Massachusetts Supreme Judicial Court Rules Auto Accident Victim Should Have Received MedPay Coverage — Golchin v. Liberty Mutual Ins. Co., Dec. 5, 2013

Wrongful death: Harvard sued for drug deal resulting in murder, Jun. 14, 2012

In Massachusetts, How Far Does the Physician Duty to Unknown Third Parties Extend? — Medina v. Hochberg, Jan 20, 2014