Court Opinion

ID: 2701813
Source: CourtListenerOpinion
Date Created: 2014-08-04 19:41:35.468221+00
Date Added: 2024-06-11T15:44:25.508127
License: Public Domain

[Cite as Lang v. Beachwood Pointe Care Ctr., 2014-Ohio-1238.]

                Court of Appeals of Ohio
                              EIGHTH APPELLATE DISTRICT
                                 COUNTY OF CUYAHOGA

                             JOURNAL ENTRY AND OPINION
                                     No. 100109

               DANIEL P. LANG, AS THE PERSONAL
              REPRESENTATIVE OF THE ESTATE OF
                 MARY L. STEVENS (DECEASED)

                                                          PLAINTIFF-APPELLEE

                                                    vs.

       BEACHWOOD POINTE CARE CENTER, ET AL.
                                                          DEFENDANTS-APPELLANTS

                                          JUDGMENT:
                                           AFFIRMED

                                     Civil Appeal from the
                            Cuyahoga County Court of Common Pleas
                                   Case No. CV-13-803569

        BEFORE: Stewart, J., Blackmon, P.J., and McCormack, J.
        RELEASED AND JOURNALIZED: March 27, 2014
ATTORNEYS FOR APPELLANTS

Susan M. Audey
Ernest W. Auciello, Jr.
Jane F. Warner
Tucker Ellis L.L.P.
950 Main Avenue, Suite 1100
Cleveland, OH 44113

ATTORNEYS FOR APPELLEE

Blake A. Dickson
Mark D. Tolles, II
Jacqueline M. Mathews
The Dickson Firm, L.L.C.
Enterprise Place, Suite 420
3401 Enterprise Parkway
Beachwood, OH 44122
MELODY J. STEWART, J.:

      {¶1} When decedent Mary Stevens was admitted to defendant-appellant

Beachwood Pointe Care Center for nursing care, her stepdaughter signed the admission

paperwork as Stevens’s “representative.” Among the papers signed by the stepdaughter

was an agreement to arbitrate all disputes between Stevens and Beachwood Pointe.

Stevens later died from injuries she suffered while a resident at Beachwood Pointe —

injuries that her estate, through its representative Daniel Lang, alleged were caused by

Beachwood Pointe’s negligence. Beachwood Pointe filed a motion to stay proceedings

and refer the matter to arbitration.   It is undisputed that Stevens did not sign any

paperwork nor is it disputed that the stepdaughter did not have a power of attorney to

make decisions for Stevens.      Beachwood Pointe argued that the stepdaughter had

apparent authority to bind Stevens to arbitration. The court disagreed and its refusal to

stay the proceedings and order arbitration is the sole issue on appeal. We find no error

and affirm.

      {¶2} The general legal proposition applicable to this appeal is that arbitration is a

matter of contract and a party cannot be forced to arbitrate that which the party has not

agreed to arbitrate. AT&T Technologies, Inc. v. Communications Workers of Am., 475

U.S. 643, 648-649, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986). When the parties dispute

whether an agreement to arbitrate exists, that dispute presents a mixed question of fact

and law — the courts determine whether a contract to arbitrate exists as a matter of fact,
Nationwide Mut. Fire Ins. Co. v. Guman Bros. Farm, 73 Ohio St.3d 107, 108, 652 N.E.2d

684 (1995), but once an agreement to arbitrate is found to exist, the terms of that

agreement are construed as a matter of law. Alexander v. Buckeye Pipe Line Co., 53

Ohio St.2d 241, 374 N.E.2d 146 (1978), paragraph one of the syllabus.

       {¶3} Stevens did not sign any paperwork when admitted to Beachwood Pointe, so

she did not expressly agree to arbitration.       Nor did Stevens expressly appoint the

stepdaughter as her agent to sign the admission papers in her stead. Beachwood Pointe

argues that the stepdaughter had apparent authority to sign documents because it believed

in good faith that the stepdaughter had the necessary authority to bind Stevens.

       {¶4} In the absence of direct authorization to act on behalf of another, principles of

agency law state that an agent may act on behalf of a principal when the agent has

apparent authority to do so. An agent’s authority to act always flows from the principal,

so it is the acts of the principal, not the agent, that determine whether apparent authority

had been given. Ohio State Bar Assn. v. Martin, 118 Ohio St.3d 119, 2008-Ohio-1809,

886 N.E.2d 827, ¶ 41. Apparent authority for an agent’s act will be found when (1) the

principal held the agent out to the public as possessing sufficient authority to embrace the

particular act in question, or knowingly permitted the agent to act as having such

authority, and (2) the person dealing with the agent knew of those facts and acting in

good faith had reason to believe and did believe that the agent possessed the necessary

authority. Master Consol. Corp. v. BancOhio Natl. Bank, 61 Ohio St.3d 570, 575 N.E.2d
817 (1991), syllabus. This test is set forth in the conjunctive, so the failure to establish

both parts of the test is fatal to a claim that an agent acted with apparent authority.

       {¶5} As to the first part of the apparent authority test, there was no evidence that

Stevens caused, allowed, or held her stepdaughter out to the public as possessing

sufficient authority to bind her to arbitrate any disputes with Beachwood Pointe.

Beachwood Pointe concedes that Stevens had not granted anyone a power of attorney

either before or at the time of her admission. Stevens did execute a power of attorney,

but not until after all of the admission documentation, including the contested arbitration

agreement, had been signed by the stepdaughter. There is simply no evidence of any

kind that Stevens held the stepdaughter out at the time as having sufficient authority to

sign the admission papers and agree to binding arbitration. On this basis alone, the court

did not err by finding that the stepdaughter lacked apparent authority to bind Stevens to

arbitrate any disputes with Beachwood Pointe.

       {¶6} Beachwood Pointe argues that the stepdaughter signed other documents

without Stevens challenging her authority to do so; notably, authorizations on a

PASSPORT form to release to Beachwood Pointe Stevens’s private medical information.

 Even if Stevens knew that her stepdaughter would sign necessary admission papers,

medical authorizations, and applications for federal benefits, there is no evidence that

Stevens’s agreement to arbitrate disputes was a necessary precondition for admission to

Beachwood Pointe. Nor was the arbitration agreement one that Stevens, or anyone else

in her place, might reasonably expect to be a part of the admission process. So Stevens
could not give her stepdaughter authority to bind her to an arbitration clause that she

knew nothing about. See Licata v. GGNSC Malden Dexter LLC, 466 Mass. 793, 802, 2

N.E.3d 840 (2014).

      {¶7} As for the second part of the apparent authority test, we find no evidence to

prove that Beachwood Pointe had reason to believe that the stepdaughter possessed the

necessary authority to bind Stevens to arbitrate all disputes. The stepdaughter claimed

that on more than one occasion she told Beachwood Pointe that she had no authority to

sign the papers that contained the arbitration clause. She claimed that Beachwood Pointe

told her it needed her to sign the papers for “general purposes.” Beachwood Pointe

disagreed — its admission’s director stated in an affidavit that she asked the stepdaughter

to sign the papers because the stepdaughter “appeared to have decision making authority

for Mary Stevens.”

      {¶8} The resolution of this factual conflict as to what Beachwood Pointe believed

concerning Stevens’s delegation of authority to the stepdaughter rests on Beachwood

Pointe’s acknowledgment that Stevens appeared to lack the mental capacity necessary to

delegate authority to the stepdaughter. The admission director’s affidavit stated that at

the time of admission, Stevens was “sometimes forgetful and questions remained about

her ability to understand and remember the information contained in the Admission

Agreement and Arbitration Agreements or my explanations thereof.”

      {¶9} Beachwood Pointe knew that Stevens had not given a power of attorney to

the stepdaughter prior to admission. It also conceded that Stevens lacked the ability to
understand the admission procedure, much less that she was being asked to arbitrate any

disputes that might arise between her and Beachwood Pointe. This being so, we fail to

see why Beachwood Pointe would think that Stevens was nonetheless competent to

authorize the stepdaughter to act for her, particularly when Stevens did nothing

affirmative from Beachwood Pointe’s perspective to give the stepdaughter authority to act

for her. If Stevens could not understand the admission papers because of a mental

incapacity, it is difficult to comprehend how Beachwood Pointe can argue that she

nonetheless had the mental capacity to appoint the stepdaughter to sign that which she did

not understand. See Diversicare Leasing Corp. v. Cooper, W.D.Ark. No. 6:12-cv-6055,

2013 U.S. Dist. LEXIS 59989 (Apr. 26, 2013).            And to the extent that Stevens’s

acquiescence to some of the stepdaughter’s actions might be viewed as passive assent to

the stepdaughter’s authority, we agree with the Supreme Judicial Court of Massachusetts,

which recently disagreed with the proposition that “a patient may through silence alone

consent to actions of which the patient lacks knowledge * * *.” Licata, 466 Mass. at fn.

6, 2 N.E.3d 840.

      {¶10} The court did not err by finding the arbitration agreement was not binding

on Stevens.

      {¶11} Judgment affirmed.

      It is ordered that appellee recover of appellants its costs herein taxed.

      The court finds there were reasonable grounds for this appeal.
      It is ordered that a special mandate issue out of this court directing the Cuyahoga

County Court of Common Pleas to carry this judgment into execution.

      A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of

the Rules of Appellate Procedure.

MELODY J. STEWART, JUDGE

PATRICIA ANN BLACKMON, P.J., and
TIM McCORMACK, J., CONCUR