### IN THE COURT OF APP EALS OF TENNESS EE AT JAC KSON SE PT E MB E R 1 8, 200 8 S es sio n CHERYL MCLE MORE HE ARN, ET AL 

### . v. QU INC E N UR SING and

REHABI LI TATI ON CENTER, LL C, ET AL 

### . Direc t Appeal from the Circ uit Court forShelb y County No. CT-000735-06 R ita L. Stotts, Judge

No. W2007-02563-C OA-R3-C V - Filed October 16, 2008

This appea l conce rns the enf orce ability of an arbitration a g ree ment betwee n a nursing home and one of its pat i en t s

. T he trial c ourt found that the a g ree ment was une nforc eable beca use the nursing home’s ag ent g ave a

n insufficient e x planation of the ag ree ment’s m eaning to the patient’s daug hter. We do not reac h the merits of the tria l court’s c onclu s i o n

. I n s tead, we find that the patient’s daug hter did not have the authority to s i gn t h e agr eement on her fa ther’s be half. We, there fore , aff irm the trial cour

t’s denial of the defe ndant’s motion to compel arbitration. Tenn. R. App . P. 3; Appeal as of Right; Judgment of the C ircuit Court A ffirm ed

J. S TE VE N S TA FF O RD , J., delivere d the opinion of the court, in which A LA N E. H I G H ERS , P.J., W .S, and D AVI D R. F ARMER , J., joined.

Re be c c a Ad e lma n, Me mph is, TN , f or the Ap pe lla nts Cha se Pitt ma n, Me mph is, TN , f or the Ap pe lla nts John Keith Perry, Jr ., Southaven, MS, for the Appe llees
OP IN ION

On F e br ua ry 27 , 2 00 2, Simm ie Mc Clin ton (" De c e de nt" ) w a s a dmi tte d to a nurs ingfa c ili ty called A merica

n Transitional Care (" ATC") . I n J uly 2003, new owne rs boug ht ATC and cha ng ed its name to Quince N ursing and Rehabilitation Cente r (" Quince" ). During the owner ship transition, She ila Cr a ft , Q uin c e ' s a dmi ssi on s cou ns e lor me t withthe De c e de nt' s d a ug hte r, Juton

Wils on . M s. Wil son had bee n her f

ather ' s car eg iver for

sever al y ear s and had taken a job at Quince. Thr oug hout the admissions process, the D ece dent was inc ompetent. During t h e m eeting, Ms. Wils on signe d
sever al documents for her fathe r' s admission, including the "Re sident and Fa cility Ar b itratrion Ag re e me nt" (" Ar

bit ratio n A g re e me nt" ). Un de r t he Ar bit ra tio n A g re eme nt, De c e de nt a g re e d to submit all potential claims ag ainst Quince to binding ar bitration

. De c e de nt r e ma ine d at Q uin c e un til his death on April 5, 2005.A lth o u g h se v e ra l d e fe n d a n ts w e r e n a m e d i n th e o rig in a l C o m p la in t, Q u in c e is t h e so le a p p e llan t i n th is 1

a p p e a l.
-2- On Fe bruar

y 16, 2006, Cheryl McL emore Hea rn, as administratrix of De cede nt’s estate, f iled a C omplaint ag ainst Quince for wrong ful death and nursing home neglig ence

. I n response to the 1 complaint, Quince f

iled a Motion to Compel Arbitration, based upon the A rbitration Agre em ent signe d by Ms. Wilson. After a

brief disc overy

period, the tria l court held a hear ing on the Motion on Aug ust 16, 2007. On October 8, 2007, the trial cour

t issued an orde r denying Q uince’ s motion. The trial c ourt’s orde r included spe cific f indings of f

act a nd conclusions of law :
4. On Octobe r 31, 2003, Ms. Craft on be half o f t h e n ursing home, and Ms. Wils on on behalf of he r fathe r, executed a n Admission Ag ree ment for the c ontinuing re sidency o f Mr. McCli nton at the nursing home following a cha ng e of the fac ility ’s owner ship; 5. Th e Ad

mis sio ns Ag re e me nt c on ta ins an A rb itr a tio n A g re e me nt, also executed by

Ms. Craft and Ms. Wilson; 6. At n o time did Mr. McClinton give Ms. Wils on a powe r of attorney , and at no time did a c ourt appoint Ms. Wil son as her fathe r’s
conser vator; 7. Ms. Wil son had authority to bind her father to the Ar bitration A g r e e m e n tu n d e r

t h e c o m m o nl aw o f

a p p ar e n ta g e n c y; 8. Acc ording ly , the Court declines to a dd re s s whether Ms. Wi lson had such a

uthority as her fathe r’s h ealthcare surrog ate unde r Tenn. Code Ann. § 68-11- 1806; 9. Fu rt her, thoug h, the evidenc e shows that Ms. Craf t’s customary explanatio n of the Ar

bitration Ag ree ment to prospective sig nors inc lud e d a

state me nt t

hat on e c ou ld st il l su e in c ourt if on e we re to sig n th e Ag re e me nt; 10. The e vidence further shows that, prior to ex ec u t i o n of the Arbitration Ag ree ment Sheila Craft g ave suc h an explanation, which is inaccur ate, to Ms. Wils on; 11 . M s. Cr a ft

wa s a c re dib le wi tne ss, had

no fr a ud ule nt i nte nt i n g iving the inacc urate explanation a nd was mere ly mistaken i n her
un de rs tand ingof

the Ag re e me nt; 12. Be cause o f

th e inacc urate explanation, the Arbitration Ag ree ment should n o t b e enforce d and De fenda nt’s Motion should not be g rante d.

Quince a ppeals a nd raises one issue for r eview a s stated in its brief:-3-

1. Did the Trial Court err in deny ing A ppellants’ Motion to Compel Arbitration, which was predic ated upon a

n Arbitration Ag ree ment that J u t o n Wil son, a daug hter of Simmie McClinton, signe d for he r father in conne ction with her fat h er ’s course of ca re at Appellant’s skilled nursing f a c i l i t y?

De c e de nt’ s E state ra ise s th e fo llo wi ngthr e e (3 ) i ssu e s:
1. Did the lower

court e rr in deny

ing A ppellant’s Motion t o C o m p el Arbitration, which soug ht enforc em en t of an a dmission agr eeme nt that contained ter ms which both parties we re mis take n a s to the e ff

e c t on the ir c on sti tut ion a l r ig hts ? 2. Did the lower

court e rr in finding that J uton Wi lson had appa rent a uthority to sign a n arbitration ag ree ment on behalf of her fathe r in absence o f a P o wer of Attorney or cour t order g ranting such powe r? 3. Sho uld the low e r c ourt have fo un d that the arb itr a tio n a g re e me nt wa s an unc on sc ion a ble contra ct of a dhesion?

Stand ard of Review

Wh e n c o n s id e r in g a d e n ia l o f a mo ti o n to c o mp e l ar b it r a ti o n o n a

p p e a l, w e f

o llow the standard of revie w that applies to non-jury trials. Spann v. Am. Ex

press Travel Related Se rvice s Co. , 2 2 4 S

. W

. 3 d

6 9 8 , 7 0 6 -0 7 (T en n

. C t

. Ap p

. 2 0 0 6 ). T h er ef o re , o u r re v i ew o f th e tr i al co u rt ’s fi n d i n gs of fa ct is “de novo upon the reco rd of the trial c ourt, ac companied by a pre sumption of the
corr ectne ss of t he finding, unl ess t he prepondera nce of the evidence is otherwise.” Tenn. R. App. P. 13 (d ). Our r e vie w o f q ue sti on s o f l aw i s de novo without a presumption of cor rec tness. Bain v. W e lls , 936 S.W .2d 618, 622 (Tenn. 1997)

.

Law a nd A nal ys is

T h e g r a v a m e no f

t h i s c a s e r e s t s o n t h e qu e s t i o no f w h e t h e r M s

. W i l s o nh a d

t h e a u t h o r i t y, express or otherw ise, to sign the a dmissions ag ree ment on behalf of her fathe r. In order

to bind the Dec edent to the arbitration a g ree ment, Ms. Wi lson must have had author ity to act as his ag ent. The pa rt ie s a g re e that Ms. Wils on wa s no t g ive n e xpre ss a uth or ity by he r fathe r t o s ig n th e a g re e me nt. The trial c ourt found that Ms. Wils on did not have a pow er of attorney or the a uthority to act a s Mr. Mc Clin ton ’s c on se rv a tor

. I ns te a d, the tr ia l c ourt fo un d th a t Ms . Wil so n h a d th e a pp are nt a uth or ity to ag ree to the arbitration ag ree ment.-4-

Qu inc e argue s th a t Ms . Wil so n’ s h ist or y of makin g so me me dic a l de c isi on s f or he r f a the r i s sufficie nt to provide her a ppare nt authority

to waive his rig ht to a jury trial. Specif

i ca l ly , Quince po int s o ut t

hat Ms . Wil so n m ade th e dec isi on to a dmi t he r f

a the r t o a nurs ingho me on

mul tip le
oc c a sio ns . F ur

the rm or e , Q uin c e a rgue s th a t th e De c e de nt n e ve r o bje c te d to Ms. Wils on ’s de c isi on s, even be fore his mental capa city diminis hed.

We have a ddresse d this prec ise argument in severa l rec ent ca ses. See , Ricke tts v. Christ ian Care Center of Cheatham County, Inc. , No. M2007-02036-COA- R9-CV, 2008 WL 3833660 (Tenn. Ct. Ap p. Au g . 1 5, 20 08 ); Tho rn ton v

. Al le nb ro ok e Nur sin g &Re ha b. Ctr
., LLC , No. W2007-00950- COA-R3-CV, 2008 WL2687697 (Tenn. Ct. App. July 3, 2008); Raiteri e

x r el C o x v

. N

GC Healthcare

/Knoxville, Inc. , No. E2003-00068-COA- R9-CV, 2003 WL 23094413 (Tenn. Ct. App. D e c

. 3 0 , 2 0 0 3 )

. T h e s e c a s e s r e f l e c t t h e g e n e r a l t r e n d

t h a tw e w i l l “ [ f

i n d ] a u t h o r i t y i f g i v e ne x p r e s s l y, e ith e r t hr ou g h o ra l e xpre ssi on

or via a Pow e r of Attor

ne y do c ume nt, and [wil l] f ind no a uth or ity if the principal did not ex hibit som e sort of a ct to convey authority .” Thornton , 2008 WL 2687697, at *7.

I n Thornton , the patient’s daug hter signed a packe t of admiss ions documents, including an arbitration a g ree ment, on behalf of her mother. Thornton , 2008 WL 2687697, at *1. The da ug hter did not have express authority , a dura ble power of attorne y , or a pow er of attorney for health ca

re decisions. Id. . at *6. The c ourt conc luded that these f acts, without more, were insufficient to g ive the daug hter a

ppare nt authority

to waive he r mother’ s rig ht to a jury trial.

The only signific ant di stinction betwee n the present case and Thornton is that the Dec edent in this ca se wa s incompetent duringthe admissions process. In Ri c k e tts , howeve r, the c ourt found that the patient’s incompetenc e did not chang e the analy sis on the issue of authority

. Ri c k e tts , 2008 WL 3833660, at *2. The c ourt held that “[e]ven if we assume that [the patient] was not competent at the time that Ms. Ricketts sig ned the ag ree ment, that fac t doe s not make a dif fer ence in the result.” Id

.

Ba sed upon the e x isting jurisprudenc e on this issue, and in light of the holdings in Thornton and Ri c k e tts , we c onclude that the f acts of this ca se do not support the trial cour t’s conclusion that Ms. Wi lson had appa

rent a uthority to bind her father to the Ar bitrat i o n Agr ee m ent. The r ecor d simply does not contain a

ny basis fo r M s

. W i l s on to have a uthority . Wit hout some action by the De c e de nt, we c ann ot f

ind tha t he un kn ow ing ly

g a ve his dau ghter

the a uth or ity to w a ive his
c on sti tut ion a l r ig hts

. Next, we tur n t o Qu i n ce’ s argument that Ms. Wi lson had authority to sign for

her f ather pursuant to the Te nnessee Hea lth Care De cisions Act (“ THCDA”) , Tenn. Code Ann. § 68- 11-1801, et seq . T e nn . Co de Ann. § 6 8- 11 -1 80 6( c )( 1) pr ov ide s:-5- I n the ca s e of a patient who lacks c apac ity , has not appointed a n ag ent, has not desig nated a surrog ate, and does not have a g uardia n, or whose ag ent, surrog ate, or g uardia n is not reasona

bly available , the patient’s surr og ate sha ll be identified by the supervising health ca re provider a

nd documented in the c urre nt clinical re cord of the ins tit uti on or ins tit uti on s at whic h th e patie nt i s th e n r e c e ivi nghe a lth
car e.

Id . Quince de signated Ms. Wil son as her fathe r’s surr og ate in its rec ords.

Qu inc e ’s re lia

nc e on the TH CD A is misp la c e d be c a us e the a c t did n ot t a ke e ff e c t un til July 1, 2004. Tenn. Pub. Ac ts c h. 862. The Arbitration Ag ree ment at issue was sig ned on Oc tober 31, 2003. I n Ri c k

e tts , the cour

t r uled that the THCDA would not apply retroa ctively

. Ri c k

e tts , 2 0 0 8 WL 3833660, at *4. Ther efor e, we conclude that the THCDA does not a pply to Ms. Wil son. This issue is w ith ou t me ri t.

Conclusion

Be cause Ms. Wilson did not ha ve authority to sig n the Arbitration Ag ree ment on her f ather ’s behalf , the ag ree ment is unenfor cea ble. Having rea ched this decision, we aff irm the orde r of the tr ial
c ourt and fi nd the re ma ini ngis sues pr e te rm itt e d. We n ote that, a lth ou g h th e tr ia l c ourt ba se d it s decision on i ts conclusion t hat the contr act wa s unenfor cea ble bec ause of

an inade quate e x planation, this Court m ay

aff irm a decision on g rounds differ ent than those relied on by the trial cour

t when the trial court r eac hed the c orre ct re sult. See, e .g. , W oo d v. Me tro . Na sh v ill e & Da v ids on Co. Go v ’t

. , 196 S.W. 3d1 5 2 , 1 6 0 n

. 6 ( T e n n

. C t

. A p p

. 2 0 0 5 )

. C o s t s o f t h i s a p p e a l ar e a s s e s s e d t o Q u i n c e a ndits surety

.

___________________________________ J. S T E V E N S T A F F O R D , J.