### IN THE COURT OF APP EALS OF TENNESS EE AT KNOXVI LLE A ugus t 17 , 200 7 S es sio n
EVA HENDRI X, ET AL 

### . v. LI FE CARE CENTERS OF AMERI CA, INC., ET AL 

### . Appeal f rom the Circ uit Court for Ham ilton Coun ty No. 04 C 1795 W. Ne il Th om as, III, Jud ge

No. E2006-02288-COA- R3-CV- F ILED DECEMBE R 21, 2007

I n this wrong ful death case, Eva Hendrix (“D aug hter” ), acting indivi dually and as administratrix of the estate of her

mother, the decede nt Edith Be ck (“Mother” ), sued L ife Center Centers of America , I nc. (“NursingHome”) among others. Nur sing H ome filed a “Motion to Compel Arbitration” base d up on an a rb itr a tio n c la

us e sig ne d b y

Da ug hte r whe n M oth e r w a s a d m itt e d to Nurs ingHo me ’s fa c ili ty approximately four months be fore her death. Daug hter responds that she w as not ac tually authorized to act as Mother ’s attorne y -i n -f act at that time because Mother wa s still able to make her ow n medical de cisions and there fo r e the powe r of attorney never beca me ef fec tive. The trial c ourt ag ree d. Nursing Home appe als, argu i n g t h at Daughte r’s powe r of attorney was e ffe ctive whe n she sig ned the ar bitration clause, a

nd that, in any

event, a n actua l or appa

ren t age n cy re lationship ex isted betwee n Mother and Daug hter, and Mother and Daug hter “ treated the [power of attorney ] document as t houg h it was effe ctive.” We find that the evide nce doe s not preponder ate a g ainst the trial cour t’s
c on c lus ion

that th e po we r o f atto rn e y wa s n ot in ef

fe c t w he n D a

ug hte r s ig ne d th e va

ri ou s d oc ume nts ha nd e d to he r b y

Nurs ing Ho me

. We fu

rt he r ho ld that Nurs ing Ho me ’s a lte rn a tiv e the or ie s mu st f a il
a s a matte r o f l aw. We t

he re fo re a ff

ir m. Tenn R. App . P . 3 Appeal as of Right; Judgme nt of th e Circ uit Court Aff irm ed; Case R em anded

C H A RLES D. S US ANO , J R ., J ., delivere d the opinion of the cour t, in which D. M I CH A EL S WI NEY and S HAR ON G. L EE , J J ., joined.
Kyle E

. He d ri ck and G lenna M. Ramer , Chattanoog a, Te nnessee , for the a ppellants, L ife Car e Ce nte rs of

Am e ri c a , I nc ., L if

e Care Ce nte r of Ea st Rid g e , a nd Ea st R idg e Me dic a l Inv e sto rs , L L C.

J ames W. Clements, I I I , Chattanoog a, Te nnesse e, for the appe llee, Eva

Hendr ix , I ndividually

and as Administratrix of the Estate of Edith C. Be ck.-2- OP IN ION

I.

Mother executed two se parate Power of Attorney (“POA” ) docume nts, one in 2002 and one in 2003. At the out set, we will defe r di scussion of t hese documents, the circ umstances unde r which the y we re to b e c ome e ff

e c tiv e , a nd the c ru c ia l qu e sti on

of wh ich P OA c on tr ols thi s c a se . A t th is jun c tur e , w e no te sim

ply that bo th d oc ume nts name d D a ug hte r a s Mo the r’ s att orn ey -i n- fa c t,
c on tin g e nt u

po n th e oc c ur

re nc e of c e rt a in c ir c ums tanc e s p e rt a ini ngto M oth e r’ s h e a lththat w ou ld t r i g g e r D a u g h t e r ’ s a u t h o r i t y.
Mother wa s admitted to Nursing Home in May 2004 afte r hi p repla ceme nt surg ery . A re port on h e r tr an s f

e r f r o m th e h o s p it a l w h e r e th e s u r g e r y o c c u r r e d in d ic a te d th a t M o th e r w a s “ a le rt and oriented” and “unde rstands instructions and ca n assist in her own ca

re.” Neve rtheless, Da

ug hter handled most of the pa

perw ork whe n Mother ar rived at Nursing Home. Da ug hter sig ned seve ral forms on Mother’ s behalf, inc luding the arbitration agr eeme nt that is the crux of this dis pute. Fr om the e vid e nc e in t

he re c or d, it do e s no t a

pp e ar that anyon e – Mo the r, Da ug hte r, or the Nurs ingHo me e mpl oy e e , E lis a

Ce sso r, wh o h and le d th e a dmi ssi on pr oc e ss – wa s p art ic ula

rl y c on c e rn e d a t the tim e abo u t D a u g h te r ’ s le g a l s tatu s w it

h r e s p e c t t o th e s ig n in g o f th e f o r ms

. I n d e e d , N u r s in g H o me ’s
a tto rn e y c on c e de d at or a l argume nt,

Ithink the rec ord’s c lear

that Ms. Cessor [ i.e. , the admitting e mploy ee of Nursing Home ] di d not take the wr itten Power of Attorne y [document] and revie w it, a nd then attempt to c ontact a d o ct o r and
re qu e st a re c or d th a t say s, “ [Mothe r] ha s b e e n f ound me dic a lly

un a ble to handle these circ umstances.”

Ra the r, Nurs ingHo me , in its wo rd s, “ re l[ie d] up on

so me on e ” – n a me ly Da

ug hte r – “ wh o c ome s in and say s , ‘ I ’ m th e PO A

. I h a v e th e a u th o r it y

. H e r e ’ s th e Po w e r o f A tt o r n e y

. L e t me sign the documents.’”

On the same day

that Daug hter sig ned seve ral a dmissions forms for Mother, including the
arb itr a tio n for m, Mo th e r h e rs e lf sig ne d a “ Do No t Re su sc itate ” fo rm , o r “ DN R.” Nurs ingHo me employ ee Ce ssor stated t hat M other did this voluntarily and with appa rent unde rstanding of what she was doing . Nursing Home’s attorney conce ded this point at oral ar g um en t , stating, “ Idon’t think there was a

ny question raised by

[Nursing Home] at the tim e she sig ned the DN R that she had the ability to sign the D NR.”

Mother died in October 2004. Daug hter filed suit in November 2004 seekingdamag es for Mother’s wr ong ful death. She sued individually and as a dminist ratrix of Mother’s e state. In Marc h 2005, Nursing Home filed a mot i o n t o enfor ce a

rbitration and stay

proce eding s, relying upon the
arb itr a tio n a g re e me nt s ig ne d b y Da ug hte r o n b e ha lf

of Mo the r. Th e c ourt

de nie d th e mot io n in No v em b er

2 0 0 5 , d ec l ar i n g,-3- [t ]h er e i s no evidenc e bef ore the Court that the dece dent was incapa citated at the t ime of her admission to L ife Care. As a matter of fac t, the contra

ry is indicated by L ife Care’ s ob t ai n i n g the d e c e d e n t ’ s s i g n a tu r e s o nd o n o tr e s u s c i t a t e o r d e r s

. A c c o r d i n g l y, based upon the rec ord bef ore the Court, there has bee n no showing that the power

of attorne y

beca me ac tive. Nursing Home appe als as a matter of r ight. See Tenn. Code Ann. § 29- 5-319 (Supp. 2000).

Our r e vie w i s de novo up on the re c or d o f t

he pr oc e e din g s b e low , b ut that reco rd c ome s to us with a presumption of cor rec tness as to the trial judge ’s fac tual finding s. Tenn. R. App. P. 13(d). We m us t ho no r t

his pr e sumpt ion

un le ss w e fi nd that th e e vid e nc e pr e po nd e rate s a g a ins t th os e finding s. Id. ; Hass v. Kni ghton , 676 S.W .2d 554, 555 (Tenn. 1984) . There i s , h o wever, no presumption of cor

rec tness with reg ard to the tria l court’s conclusions on matters of law, Taylor v. Fe ze ll , 158 S.W .3d 352, 357 (Tenn. 2005) , or to its application of l aw to the f acts, State v. Thacker , 164 S.W .3d 208, 248 (Tenn. 2005) , or to “c onclusions that a re based on undisputed fac ts,” Hall v. Houst on , No. M2002-01371-COA- R3-CV, 2003 WL 21688578, at *3 (Te nn. Ct. App. M.S., fil ed J uly 21, 2003). The inter

pretation o f a wr i t t en i nstrument, including a power of attorne y

or an arbitration ag ree ment, is a matter of law. Te nn. F

ar m ers Li

fe Rea ssu ra nc eCo. v

. Ro se , No. E2005-00006- S C -R 11-CV, 2007 WL2826918, at *4 (Te nn., filed Oc tober 2, 2007) ( power of
a tto rn e y ); Font aine v. Weekly H

om es, L.P. , No. M2002-01651-COA- R3-CV, 2003 WL 21946721, at *1 (Te nn. Ct. App. M.S., fil ed August 13, 2003) (ar bitration ag ree ment). Thus, no presumption of c o r r e c t n e s s a t t a c h e s t o t h e t r i a l c o u rt ’ s i n t e r p r e t a t i o n o f t h e w r i t t e n t e r m s o f t h e d o c ume nts in qu e sti on . H ow e ve r, the tr ia l c ourt is e nti tle d to a

pr e sumpt ion of c or

re c tne ss as to i ts f

ind ing s w ith
re sp e c t to the surr ound ingfa c tua l c ir c ums tanc e s.
II.
As an initial matter, we must decide which Power of Attorney document contr ols this case. M o ther e x ecute d two separ ate POAs: a Te nnessee Hea lthcare Dura ble Power of

Attorney and a broade r Dura

ble Power of

Attorney

. The healthca

re POA was executed in Aug ust 2002; the ge nera l POA was e x ecute d in J une 2003. Both documents name Daug hter a s Mother’s attorney -in-fa ct, but t h e c i rc u m s t an ce s u n d er wh i ch Da u gh t er ’s au t h o ri t y b ec o m es ef fe ct i v e ar e d i ff

er en t u n d er

l an gu age fo un d in the tw o d oc ume nts

. The healthca

re POA contains the following provision relatingto when it become s eff ective:

This he althcar e durable power of attorney only becomes ef fective wh e n I c an’ t make my

ow n me dic a l de c isi on s. My a g e nt [ i.e. , the attorney -in-fa ct] and my attending phy sician wil l decide when I can’ t make de cisions for my self.T he ana l y s i s on t hi s po i nt i s comp l i cat ed by t he l ang uag e t hat appear s i n t he gen er al P O A ’ s “ M edi cal Care ” 1

s ec t i on

. O n t h e on e h an d, t h e at t or n ey
- i n
- f ac t ’ s a u t h or i t y ov er M ot h er ’ s a dmi s s i on t o a n u r s i n g h ome i s s pec i f i ca l l y ma de

co nt i ngent upo n a “l i censed p hy si ci an” d ecl ari ng M o t her “i nco m p et ent o r i ncap ab l e o f act i ng f o r mys el f

” – a s t and ard t hat seem s t o ad d res s m ent al cap aci t y

. O n t he o t her hand , t he very next sent ence st at es t hat t he at t o rney
- i n- f act ’ s p o wers
o ver “ a l l m a t t ers p er t ai ni ng t o

. . . my per s on” a r e t o “ cont i nu e c om pl et el y af t er I ha ve becom e p h y sic a lly o r m e n ta lly i nca paci t at ed” ( emp has es added). As wi l l be s een , we ar e s pare d t he nec es s i t y of s ort i ng t hr ough t hi s l i ng ui s t i c t hi cke t i n g r eat er det ai l , as our hol di ng per t er mi t s t he i s s ue.
-4- I t also states, “[ n]ot withstanding this document, y ou [ i.e. , Mother] have the r ight to make medical and other healthca re de cisions for y ourself so longas y o u can g ive informed c onsent with respe ct to the particula

r dec ision.”

Th e g e ne ra l PO A i nc lud e s th e fo llo wi nglangua g e c on c e rn ingits e ff e c tiv e ne ss:

THI S POW ER OF AT TORNEY SHAL LBECOME EFFECTI VE UPON I NCAPACI TY OF THE PRI NCI PAL

* * *

2. Effe ctive Date and Te rmination

A. Eff ective: This power of attorney shall become eff

ective immedia t el y

upon my

incapa city

or inability

to manag e my

own a ff a ir s.
B. Termination: This pow er of attorney shall remain in full for ce a nd eff ect until it is revoked.

i. By written re vocation i i

. B y wr itt e n n oti c e r e c o r d e d in t he sa me of

fi c e a s thi s instrument in the event this instrument is recorde d. iii. Until terminated by

operation of law.

I t is my intent that this power of attorney shall remain e ffe ctive eve n in the event of

mental or phy sical d i s abil ity on my part whe ther
c on tin uo us or int e rm itt e nt. (Capitalization and formatting in orig inal.)

As can b e s e e n , w h e r e a s th e h e a lt h c ar e PO A b e c o me s e f

f e c ti v e o n ly

w h e nM o th e r

“ c an’t
m ak e [ h er ] o wn m ed i ca l d ec i s i o n s , ” a ph ra s e a d dre s s i n g mental capa city , the g ener al POA bec omes e f f e c t i v e “ i m m e d i a t e l y u

p o n[ h e r ] i n c a

p a c i t y or ina bil ity to m ana g e [he r] o wn

a ff a ir s” (e mph a sis added) . I n light of the subsequent languag e in the g ener al POA per tai n i n g t o “m en tal or phy sical d is a b il it y , ” it c anb e a r g u e d , an d

N u r s in g H o me d o e s in d e e d ar g u e , th a t “ in c a p a c it y ” in th is c o n te xt ref ers to e it her men tal or

phy sical inca

pacity

. We do not so hold, but assuming f or the sake of 1 argument that Nursing Home is c orre ct, this would be important beca use Daug hter’s attorneyW e do n ot e t h at t h e h ea l t h ca r e PO A d o es no t c on t ai n a n y l an g u ag e s pec i f i ca l l y pe r t ai n i n g t o a r bi t r at i on 2
agreem ent s, whereas t he general P O A gi ves D aught er t he t he p o wer “ [t ]o sue, de f end o r co m p rom i se al l l egal act i o ns i nvo l ving m e o r m y e st at e” and “ t he p o wer t o general l y do , s i gn or p erf o rm any ot her act , de ed , m at t er or t hi ng
w h a tso e v e r th a t o u g h t t o b e d o n e , sign e d o r p e rfo rm e d [.]” H o w e v e r, N u rs ing H o m e d o e s n o t ar g u e , e ithe r in its b rie fs

o r at o ral argum ent , t hat t he arbit rat i o n agreem ent l i es o ut si d e t he scop e o f heal t hcare- rel a te d d e ci si o n- m aki ng. M or eov er , t h e Su pr eme Cour t r ec en t l y h el d t h at “ an a t t or n ey
- i n
- f ac t a ct i n g pu r s u an t t o a du r abl e powe r of a t t or n ey f

or hea l t h car e may s i gn a n ur s i ng
- home cont r act t hat cont ai ns an ar bi t r at i on provi s i on .

. . . ” O wens v . N at ’ l H eal t h Cor p. , N o

. M 2 0 0 5

- 0 1 2 7 2

- SC

- R 1 1

- C V , 20 0 7 W L 3 2 8 4 6 6 9 , at * 6 (T enn. , f i l ed N o vem b er 8, 2 0 0 7 ).
-5- c on c e de d at or a l ar g ume nt that Mo the r w a s ph y sic all y inc a pa c itate d a t th e tim e of

he r a dmi ssi on

to Nursing Home. I f the g ener al POA, as interpre ted by Nursing Home, controls, it would follow that Daug hter’s POA pow ers we re a ctive at the time of Mother’s admission, and there fore the ar bitration clause would be valid. Howe ver, the g ener al POA als o contains this important lang uag e, in the section on medica l car e:

I n the eve nt Ihave e x ecute d a valid Dur able Power of Attorney

for Hea lth Care and i n t h e event there is any conflict be tween the two documents, it is my intention that the Durable Power of Attorney for Health Care shall be controlling. (Emphasis adde d).

At oral a rg ument, Nursing Home’s attorney argued that there can be no “conf lict” betwe en an ac tive POA and an inactive POA, and thus, if we acc ept Daug hter’s argument that the hea lthcare POA was inef

fec tive at the time in question, it would follow nece ssarily that the g ener al POA, which (i t is argue d) be c a me e ff

e c tiv e up on

Mo the r’ s p hysical

incapa citation, must control. We cannot accep t t h i s line of re asoning . The g ener al POA states that the he althcar e POA contr ols “[i] n the event I have exe cuted

a v ali d [healthcare POA]” ( emphase s added)

. I f we wer e to ac cept Nur sing Home’s log ic, we w ould essentially be re writing that clause and declaring , in effe ct, that the healthca re POA takes pre cede nce only upon bec oming effective , contra ry to the expressed intent of the pa rt ie s th a t it

take pr e c e de nc e up on

be ingva lid ly

e xec ute d. Th is w ou ld m e an th a t, i n a ny c a se with simi lar languag e whe re the g ener al POA has a broade r def

inition of inca

pacity than the healthca re POA, the g ener al POA’s more permissive s t an d ards f or ef fec tiveness would take prec edenc e over

the hea lthcare POA’s more string ent standar ds. We think, based on the t ext of the document in question, that this is clearly no t wh at is intended by

the phra se “[i] n the eve nt Ihave
ex ecut e d a

va lid Dura ble Pow e r o f A tto rn e y

fo r H e a lthCare and

in t he e ve nt t he re is a n yc o n fl ict betwee n the two documents” (empha sis a dded). Where the matter at issue relates to he alth car e, and 2 there is a conflict be tween the g ener al P OA and the he althcar e POA over the question of whe ther the attorne y -in-fa ct had POA a uthority at the ti me i n question, the hea lthcare POA, by the g ener al POA ’s ow n te rm s, c on tr ols

.
III

. Havingdeter

mined that the hea lthcare POA controls, the next question is whether the trial court err ed in r

uling that “[t] here is no evidence befor e the Court that the de cede nt was inca pacitate d-6-

at t he ti me of her admission to L ife Care” and there fore “ther e has been no showing that the power of attorne y

beca me ac tive.”

We note that the word “inca pacitate d” appear s only in the gene ral P OA, not in the healthca re POA. The he althcar e POA dec lare s simply that it “bec omes eff ective when I can’ t make my own medi cal de cisions.” Howe ver, w e believe the context of the trial cour t’s opinion, particularly

the ref ere nce to Mother

signingthe Do Not Resuscitate order , makes clea r that the cour

t was re fer

ring to the concept of mental incapa city (as oppose d to phy sical inca pacity ), which is dire ctly

on point wit h the hea lthcare POA’s re quirement that Mother be unable to “make [her] own medica l decisions” a

nd its further statem en t t h at “medica l and other he althcar e dec isions” remain he r p r e r o g a ti v e “ s o lo n g a s [s h e ] c ang iv e in f o r me d c o n s e n t w it

h r e s p e c t t o th e p arti c u la

r d e c is io n

. ” We int e rp re t th e c ourt ’s or de r a s d e c lari ng , a s a fact ual matte r, that Mo the r w a s n ot me nta lly inc a pa c itate d, and

thu s w a s a

ble to m a ke he r o wn me dic a l dec isi on s and g ive inf or me d c on se nt w ith
re sp e c t to me dic a l and

oth e r h e a lth c are de c isi on s. Nursing Home ar g ues that Mot her was i ncapa citated whe n Daug hter sig ned the a rbitration ag ree ment, and ther efor e the POA wa s eff ective at that time and the ag ree ment is valid. To the
e xt e nt t hat th is a rgume nt i s p re mis e d o n th e no tio n th a t physical incapa city

is enoug h to trigg er Daug hter’s POA pow ers, we simply ref er back to our above- stated holding that the he althcar e POA, wh ic h r e qu ir e s mental

incapa city , takes pre cede nce ove r the ge nera l POA, which ar g uably require s only ph y s i ca l i n ca p acity . On the other hand, to the extent that Nursing Home is sug g esting that Mo the r w a s in

fa c t me nta lly

inc a pa ble of makin g de c isi on s f

or he rs e lf a t the tim e of

a dmi ssi on , th is is a fac tual argument, and it is our duty to determine w hether

the evidenc e pre ponderates ag ainst the trial court’ s fac tual finding s on this is sue.

I n support of i ts argument, Nursing Home cites D aug hter’s te stimony at her deposition that “ther e wa s a per iod of time that [M other] was incapac itated and [ Daug hter] took care of her needs during that time,” and other simil ar e vidence sug g esting that Mother was inca pacitate d. Howeve r, as noted e arlier , there was c ounterva iling evide nce, which Nursing Home’s br ief doe s not mention, such as the me dical re port dec laringMother able to “under stand [i] nstructions and . . . assist in her
ow n c are ” and

the fa c t th a t Mo the r v olu ntari ly sig ne d a

Do No t Re su sc itate or de r. Al l of thi s evidenc e, and mor e, wa s befor e the tria l court when it found as a matter of fa ct that Mother wa s not incapa citated suc h as to trig g er the healthca re POA. H aving revie wed the r ecor d, we cannot say that the evidenc e pre ponderates ag ainst the court’ s fac tual finding s on this matter.

Be cause M o th e r

w a s n o t i n c a

p a c it a te d to th e p o in t o f

b e in gu n a

b le to ma

k e h e r own decisions, it is clear that Daug hter’s POA a uthority , by

the terms of the document cr eatingit, was not effe ctive at the time she signe d the ar bitratio n cl ause. I t is not di spositive that the purported
a tto rn e y -i n- fa c t w ho inv a lid ly sig ne d th e arb itr a tio n a g re e me nt i s th e same pe rs on a s th e pla int if

f i n this case. The arbitration clause purpo rt ed to re linquish Mother’s ri g hts , n ot D a ug hte r’ s, and

it i s not valid – it never w as valid – unless its execution was validly authorized by

Mother. This re mains true re g ardle ss of Daug hter’s r ole in subsequent litigation.D aught er was t he at t o rney
- i n- f act f o r bo t h her mo t her and f at her. 3

-7- I V. Nursing Home adva

nces se vera l alternative theories for why the ar bitration clause should be honored e ven if Da

ug hter’s pow er of at t o rney was inef fec tive. We find none of them pe rsuasive.

First of a ll, we note that Nursing Home cannot preva il on an appare nt ag ency theory . Nursing Hom e’s br ief c ontains considera ble discussion of Daug hter’s be liefs, under standing s and repr esentations, but t hese a lone ca nnot cre ate a

pparen t age n cy

beca use they relate to acts a

nd statement s o f t h e p u rported a g ent, not the purporte d principal (in this ca se, Mother) . “Appa rent ag ency is e ssentially ag ency by estoppel; its creation and exis tence depend upon suc h conduct by the apparent principal

as will prec lude him from deny ing a nother’s a g ency .” Whit

e v. Methodist Hosp. S. , 844 S.W .2d 642, 646 (Tenn. Ct. App. 1992) (empha sis a dded). N ursing Home simply does not
m a k e o u ta

c a s e th a ti t r e l i e d o n an y c o n d u c to r r e p r e s e n t a t i o n s b y Mother that Daug hter wa s her ag ent for the purpose in question.

This l i m i t at i o n would not matter, of c ourse, if N ursing Home could show that Daug hter
a c tu a l l y was Mother’s a g ent for the purpose in q u es t i o n , and thus had actual authority to sign the arbitration ag ree ment. See Nec essary v. Life Care Ctrs. of Am ., Inc. , E2006-00453-COA- R3-CV, 2007 WL 3446636 (Tenn. Ct. App. E.S., filed Nove mber 16, 2007). T his is precisely what Nur sing Hom e att empts to do when it argues that Mother g ave D aug hter “ express authority to handle the
a dmi ssi on s p ro c e ss, ” and

that th is autho ri ty wa s val id re g ard le ss of the status of

the POAdo c ume nt. Ho we ve r, the e vid e nc e of fe re d b y Nursin g Ho me in s up po rt of thi s argume nt i s in e xtri c a bly intertwined with the p o wer -of- attorney issue. Nursing Home’s br ief quotes f rom Daug hter’s de po sit ion

a s f oll ow s: Q. So w a s it

y our u nd e rs tand inga t th a t ti me that once that [power of attorney] docume nt was si gned y ou had the ability

to sign the c hecks
and do oth e r t

hin g s f or y our p are nts ’ ne e ds ?

3

A. As de sig nate d b y

the m, ye s. I f t

he y a sk e d me to, y e s. Q. Ok ay

. Yo ur un de rs tand ingwa s th a t once this was signed on J une the 2n d , 2 0 0 3 , if th e y a s k e d y o u to d o s o me th in g f o r th e m, y ou had the po we r t o d o it by this docume nt ?

A. Th a t’ s c or

re c t. (E mph a sis and

fo otn ote a dd e d. ) A s can be se e n, bo th que sti on s and ans we rs re late sp e c if ic a lly to th e p o w e r s p u r

p o rte d ly v e s te d b y th e p o w e r
- o f

- a tt o r n e y d o c u me n t, n o t to a s e p ar a te ag ency relationship t hat ca

n be ana ly zed inde pendently of that document. Da ug hter’s te stimony

establishes only that she believe d she had the authority to act on Mother’ s behalf becauseof the POA docum ent – the ver y document that we have a lr eady found to be inef

fec tive for pur

poses of this case

. Daug hter’s “ u n d er s t anding ” of the POA does not alter its leg al ef fec t, and her

err oneous belief

s-8-

about t he scope of her

attorney -in-fa ct power s cer tainly cannot c reate an indepe ndent ag ency re latio ns hip , s e pa

rate and a pa rt fr om t he ve ry do c ume nt s he wa s te sti fy inga bo ut.
At oral a rg ument, Nursing Home empha siz ed Da ug hter’s be lief that she ha d authority to act
on he r p are nts ’ b e ha lf

on ly “ [a]s de sig nate d b y

the m” and “ [i]f the y a sk e d me to. ” Th is s tate me nt, Nursing Home ar g ues, is evidenc e that Da ug hter wa s actingwith Mother’s “e x press a uthorization” when she signe d the admission documents, including the arbitration a g ree ment. As best as we can understand it, the a

rg ument g oes like this: Daug hter told Nursing Home emplo y ee s that she was actingon the basis of he r POA authority when she signe d the admission documents, and she te stified that sh e be lie ve d he r POA a uth or ity wa s on ly a c tiv e wh e n sh e wa s e xpre ssl y a uth or ize d to e xer c ise it for a c erta in purpose, s o i t t h er ef o re f ollows that, assuming she w as beinghonest with Nursing Home, she mu st

have be en expressly

authorized to sign the a dmission docum en t s

. T h i s is an interesting thought e x periment, but it is not evide n ce o f agenc y . Whatever D aug hter mig ht have believe d , n o t h i n g i n t h e r e c o r d c o n v i n c e s u s t h a t s h e a c tu a l l y was e xpre ssl y a uth or ize d to sig n th e se documents. Ther e is evidenc e that Mother a nd Daug hter discussed the Do Not Resuscitate or der, but not that they

discussed the other

documents, including the ar bitration ag ree ment. I ndeed, when
as k edat o ra l ar gu m en t wh et h er Da u gh t er t es t i fi eds p ec i fi ca l l y

t h at h er M o t h er h adt o l d h er t o s i gn the documents in question, Nursing Home’s attorney replied, “No. That’s not in the re cord. The re’ s no specific question asking that; she doesn’t say that.” We f ind no merit in the Def

endants’ position.

N u r s i n g H o m e ’ s f

i n a l t h e o r y i s t h a tM o t h e r

an d D a u g h t e r

“ t r e a t e d t h e [ p o w e r

o f a t t o r n e y] do c ume nt a s th ou g h it

wa s e ff e c tiv e ,” and Nurs ing Ho me ha d a r ig ht t o r e ly on the ir c on du c t. T his argument is, at least in part, a reha sh of the appa

rent a nd/or ac tual age n cy t h eo ri es t hat we ha ve alre ady reje cted. How ever , to the extent that it repr esents a ne w theo ry , it relies larg ely on Smith
v . Smith , 102 S.W .3d 648 (Tenn. Ct. App. 2002), which concer ned a dispute betwee n a mother’ s two sons over whe ther one of the sons exercise d undue influenc e over her f inanc i al af

fa i rs before he r death. I n the course of finding that a confidential relationship di d indeed e x ist between the mother and the son a ccus ed o f u n d ue influenc e, the c ourt in Smith stated that “[a]lthough the powe r of attorney that Ethel g rante d to J err

y never beca

me effec tive, under its terms, bec ause Ethe l never was cer tified by her phy sician as disable d or inca pacitate d, Ethel and Jerry acte d as thoug h the power of attorney was in ef fec t and treated it as fully operative.” Id. at 653. Nursing Home asks us to make a similar finding here – i.e. , that Mother and Daug hter “ac ted as though the power of attorne y

was in ef fe c tan d t r e a t e d i ta s f u l l y o p e r a t i v e ” –

an d r u l e i nN u r s i n g H o m e ’ s f a v o r o nt h a tba sis

. Howeve r, as noted in the a g ency discussion above, Nursing H ome has not demonstrated that Mother

“ tr e a te d th e do c ume nt a s though it w a s e ff

e c tiv e .” Th e e vid e nc e mig ht s ug g e st t hat D a ug hte r d id so, but it is Mother’s rights that are at issue. Moreover , the context of the finding in Smith is e nti re ly differ ent from the c ontext of the in s t an t ca s e. The court in Smith did no t r e viv e an o the rw ise i n e f f e c t i v e p o w e r
- o f

- a t t o r n e y a g r e e m e n t f

o r p u r p o s e s o f g i v i n g l e g a l f

o r c e t o t h e p u r

p o rt e d a t t o r n e yin-fac t’s actions, as Nur sing H ome is asking us to do. Smith s im p ly h e ld th a t, for pur

poses of d ef i n i n g t h e n at u re o f t h e re l at i o n s h i p b et we en m o t h er an d s o n , t h ei r m u tu al ch o i ce t o ac t“a s t h o u gh the power of attorne y

was in ef fec t” should be taken into acc ount. That is a fa r cr y from sug g esting that a docume nt signe d by Daug hter should bind Mother as to a third par ty even thoug h Daug hter
wa s not Mo the r’ s atto rn e y -i n- fa c t at th e tim e sh e sig ne d th e do c ume nt.-9-

A sec ond case cited b y Nu rsing Home, Chil dress v . Cur rie , 74 S.W .3d 324 (Tenn. 2002) , also involves definingthe nature of the relationship betwee n the par ties to the power- of-attorney
a g re e me nt, no t de fi nin g the e ff e c tiv e ne ss o f t

hat a g re e me nt vis a vis thi rd pa rt ie s. Nurs ingHo me c on te nd s th a t Smith and Chil dress both stand for the proposition that “the critical element [i s] t he understandingof the pa

rty at intere st” – meaning , we take it, the p u rp o rt ed att orney -in-fa ct. That might m ak e sense on the fa cts of Smith and Chil dress , bu t in

the ins tant c a se , th e pa

rt y wh os e “intere st” we must conc ern our selves with is Mother, not D aug hter. Nur sing H ome is not entitled, as it sugg ested on ora l argument, to simpl y “re ly upo n s o m eo n e wh o comes in and sa y s, ‘I ’m the POA. Ihave the authority . Her e’s the Powe r of Attorne y

. L et m e si g n the documents.’” By signing the ar bitration ag ree ment, Daug hter soug ht to bind Mother to a course of ac tion that altered he r leg al rig hts. Unless Mother’s powe r-of -attorne y documents we re i n ef

fect at the time – and we have alre ady aff

irmed the trial court’s ruling that they wer e not – Daug hter did not have the power to do thi s. Th a t he r r e tr os pe c tiv e po we rl e ssn e ss n owa c c ru e s to he r o wn be ne fi t is an o dd qu ir k o f t his
case ’s fa cts, and is undoubtedly frustra ting to Nursing Home, but it does not alter the pertinent leg al do c tr ine s n or

the pr op e r ou tc ome of

thi s c a se . T he arb itr a tio n a g re e me nt w a s n ot v a lid ly a g re e d to by Mother, and the ref

ore it ca nnot bind her or he r estate

.

V.

For all of the for eg oing r easons, we aff irm the trial cour

t’s ruling . Costs on appeal ar e taxed to the appellant, L ife Car e C enter s of Amer ica, Inc. Case r emande d to the trial court f or fur ther pr oc e e din g s.

_______________________________ CHARL ES D. SUSANO, J R., J UDGE