Opinion ID: 6325742
Heading Depth: 1
Heading Rank: 3

Heading: B. of this Agreement), shall be settled

Text: exclusively by binding arbitration as set forth in Section X.D. below. This arbitration clause is 2 Both daughters were acting under durable powers of attorney. 2 meant to apply to all controversies, disputes, disagreements or claims including, but not limited to, all breach of contract claims, all negligence and malpractice claims, all tort claims, and all allegations of fraud in the inducement or requests for revision of the contract. D. CONDUCT OF BINDING ARBITRATION You understand that by hereby agreeing to arbitrate legal disputes means that you are waiving your right to sue in a court of law and to a trial by jury. You agree to arbitrate disputes by signing this Agreement. The decision of the arbitrator(s) shall be final and binding and may not be appealed nor may it be stayed. The arbitration will be conducted as follows: Any arbitration conducted pursuant to this Section X shall be conducted in Cabell County, West Virginia in accordance with the American Health Lawyers Association (“AHLA”) Alternative Dispute Resolution Service Rules of Procedure for Arbitration. The award rendered by the arbitrator(s) shall be final, and judgment on the award shall be entered in accordance with applicable law in any court having jurisdiction thereof. The parties understand that arbitration proceedings are not free and that any person requesting arbitration will be required to pay a filing fee to AHLA and other expenses; however, the parties agree to divide the arbitration expenses equally. If you would like information regarding AHLA’s Alternative Dispute Resolution Service, you may contact AHLA at (202) 833-1100 or Suite 600, 1025 Connecticut Avenue NW, Washington, DC 20036-5405. (Emphasis added). The AHLA “Rules of Procedure for Consumer Arbitration” (“AHLA Rules”), applicable to claims received on or after September 15, 2019, set forth certain 3 requirements that must be met in order for a claim to be arbitrated in accordance with the AHLA Rules. In “Section 2: Filing a Claim,” it is specified that: 2.1 Requirements To file a claim, a party must complete and submit the claim form on the AHLA website, pay the applicable fees listed in Exhibit 3 and on the form, provide a statement describing the issue(s) to be arbitrated, and either provide a copy of an agreement to arbitrate or a court order requiring arbitration of the claim under the Rules or cite a statute or regulation authorizing or requiring arbitration under the Rules. If the agreement to arbitrate was signed before the events giving rise to the claim occurred, the agreement must: (1) be a separate document conspicuously identified as an agreement to arbitrate; (2) include the following notice, or substantially similar language, in a conspicuous location: Voluntary Agreement to Arbitrate THIS AGREEMENT GOVERNS IMPORTANT LEGAL RIGHTS. PLEASE READ IT CAREFULLY BEFORE SIGNING. This is a voluntary agreement to resolve any dispute that may arise in the future between the parties under the American Health Lawyers Association’s Rules of Procedure for Arbitration. In arbitration, a neutral third party chosen by the parties issues a final, binding decision. When parties agree to arbitrate, they waive their right to a trial by jury and the possibility of an appeal. (3) state conspicuously that the health care entity will provide the same care or treatment, without delay, if the agreement is not signed; and (4) explicitly grant the resident or his or her representative the right to rescind the agreement within 30 calendar 4 days of signing it (unless a state law applicable to contracts generally grants a longer period for revocation). (Emphasis added). The AHLA Rules also includes the following provision: 2.4 Hearing on Administration of Arbitration (a) SCHEDULING. If a Consumer claims the agreement to arbitrate fails to comply with the requirements listed in Rule 2.1, the arbitrator, once appointed, will promptly schedule a preliminary hearing on this issue. The arbitrator may conduct the hearing by telephone, by video conference, and/or by submission of briefs. (b) DETERMINATION. Within ten (10) days after the preliminary hearing is closed, the arbitrator will issue an award determining whether the agreement to arbitrate satisfies the requirements set forth in Rule 2.1. If the arbitrator determines that the agreement does not satisfy the requirements, the arbitrator will issue a Final Award terminating the arbitration without prejudice to any claims or defenses. The Final Award may order the Health Care Entity to pay all the costs and fees of arbitration, including the filing fee. If the arbitrator determines the agreement satisfies the requirements, the arbitrator will issue an interim award to that effect. Any determination under this section not to administer the arbitration shall not be considered a determination on the validity of the arbitration agreement, and the parties may arbitrate in another forum if their agreement so provides or if they otherwise agree. (Emphasis added). 5 On November 29, 2016, the respondents, Louise McGraw, by and through her Daughter, Nancy Reuschel, as power of attorney, and Charlotte Rodgers, by and through her Daughter, Loretta Holcomb, as power of attorney, on their own behalf and all others similarly situated, filed an amended complaint 3 against the petitioner. 4 The respondents alleged that the petitioner defrauded their respective mothers 5 by making misrepresentations and misleading statements, and concealing material facts, all of which led them to believe the petitioner would assess its residents’ needs and provide staffing sufficient to meet those needs. The amended complaint alleged that the petitioner’s actions or inactions violated the West Virginia Consumer Credit and Protection Act (“WVCCPA”). See generally W. Va. Code §§ 46A-1-101 to -8-102 (2015 & Supp. 2021). The petitioner answered the amended complaint 6 on January 24, 2017, raising twenty-nine separate defenses, none of which involved a demand for arbitration. Thereafter, the petitioner filed pleadings and motions, including a motion to amend its amended answer, again without any mention of the arbitration provision found in the 3 The original complaint was filed on October 25, 2016. 4 The respondents filed this action as a putative class action. However, there are no issues in regard to class action status before the Court in this appeal as a class has not yet been certified. 5 Both Ms. McGraw and Ms. Rodgers are now deceased. 6 The circuit court’s order entered October 2, 2020, indicates that the petitioner answered the original complaint on December 5, 2016; however, the appendix record does not contain a copy of this answer. 6 Residency Agreements. Not until July 11, 2017, when it again sought leave to amend its answer, did the petitioner seek to add arbitration as a defense to the respondents’ claims. 7 By order entered March 11, 2019, the circuit court allowed the amended answer to be filed. On June 5, 2019 – more than two and one-half years after the filing of the original complaint – the petitioner moved to compel arbitration based upon the arbitration provision set forth in the Residency Agreements. In response thereto, the respondents filed a “Motion for Partial Summary Judgment Concerning Arbitration of Plaintiffs’ Claims and Memorandum of Law in Support,” seeking a determination that the arbitration provision was invalid as a matter of law because it did not comply with the rules the petitioner incorporated into the agreement, the application of which would result in dismissal of any arbitration. Specifically, the respondents argued that the arbitration provision adopted the AHLA Rules, which required that the arbitration provision: 1) be labeled as a “voluntary agreement;” 2) be presented in a “separate document conspicuously identified as an 7 The respondents opposed the petitioner’s motion to amend its answer in regard to arbitration, arguing that the petitioner waived that defense by failing to raise it in its initial pleadings and actively litigating the case for six months. In support of their waiver argument, the respondents pointed to numerous filings by the petitioner including responding to discovery and filing a “Motion for Judgment on the Pleadings, or in the Alternative Motion for Summary Judgment” which was based on an argument that the deceptive trade practice claims asserted by the respondents did not survive their mothers’ deaths. However, the circuit court never ruled on the waiver issue, and because the respondents fail to assert any assigned error in regard to waiver, the issue is not properly before the Court. 7 agreement to arbitrate;” 3) state that the provision of care is not contingent on signing the arbitration provision; and 4) allow for revocation of the agreement for thirty days after execution. According to the AHLA Rules, if the arbitration agreement failed to satisfy the foregoing requirements, the arbitrator was “required to issue a Final Award terminating the arbitration. . . .” Here, the respondents argued, the arbitration provision in the Residency Agreements failed to comply with any of the foregoing requisite provisions of the AHLA Rules and this failure precluded arbitration. The respondents further argued that the provision not only requires application of the AHLA Rules but also clearly designates the AHLA as the arbitration forum by requiring that the arbitration fee be paid to the AHLA and directing the parties to the AHLA’s Dispute Resolution Service. In this latter regard, the respondents contended that because the provision required the use of a particular arbitration forum, the forum is an integral term of the agreement; and therefore, because the forum was unavailable, the arbitration provision is invalid. In its amended brief in support of arbitration, the petitioner argued, among other things, that the arbitration provision did not require the AHLA to conduct or administer the arbitration, and thus the unavailability of the AHLA to conduct the arbitration was irrelevant. According to the petitioner, even if the provision could be read to require that the AHLA conduct the arbitration, the unavailability of an arbitration forum did not render the agreement to arbitrate unenforceable. 8 By order entered October 2, 2020, the circuit court found that while the claims asserted by the respondents would otherwise be subject to arbitration, the arbitration provision could not be enforced because it was contained in the admissions documentation, i.e., the Residency Agreements, rather than in a separate document, and therefore the agreement could not be enforced as written. In short, the court found that the petitioner “made a prima facie showing of the existence of an arbitration agreement. [The respondents], however, have met their burden of proof by demonstrating that the subject agreement cannot be enforced as written because it does not comply with its own stated standards.” As a result, the court denied the petitioner’s motion to compel arbitration. It is from this order that the petitioner appeals.