Nursing Home Arbitration Agreement Found to be “Unconscionable” in Neglect Case

A Pennsylvania judge has struck down a mandatory arbitration clause in a nursing home neglect lawsuit, finding that the agreement was too heavily weighted in favor of the facility, was misleading and violated the law.

The decision was handed down by Berks County Court of Common Pleas Judge Jeffrey Sprecher, rejecting an attempt by Manor Care to force the family of a resident at a facility in Reading, Pennsylvania to arbitrate their injury claim for abuse and negligence.

Manor Care is one of the largest nursing home management chains in the United States, operating several hundred skilled nursing facilities nationwide.

The case involves claims brought by Esther Hendricks, over injuries suffered by her mother as a result of the conduct of a Manor Care nursing home employee, according to a report by The Legal Intelligencer.

Hendrick’s mother was taken to the nursing home at her own request by her day nurse, and Judge Sprecher pointed out that Hendricks was told to sign the arbitration agreement during the emotional upheaval of discovering that her mother was there.

Judge Sprecher described the nursing home arbitration agreement as “unconscionable”, finding that the daughter was not authorized to sign the agreement for her mother at the time, and that the agreement was designed so that those signing it would not understand what kind of agreement they were entering.

The nursing home arbitration process is generally seen as more favorable to facilities, depriving residents and their family from pursuing claims through the court system. The agreements typically require residents to pursue their claims through binding arbitration before panels selected in the agreement to hear the disputes. However, the arbitrators typically receive a large share of their business from the nursing home injury, and critics have found that it is often difficult for residents and their families to obtain a fair resolution.

Non-negotiable arbitration provisions have become increasingly common in recent years in nursing home contracts, bank agreements and other industries where consumers are often presented with a “take-it-or-leave-it” contract only after they decide to move forward with a service.

Critics have described nursing home arbitration clauses and other similar pre-dispute agreements as “de facto” mandatory requirements, indicating that they should not be permitted or enforceable.

Most families and residents are unaware that they are signing away their right to file a nursing home lawsuit in the event the facility provides negligent or sub-standard care, and that they have little choice but to sign the agreement when they are faced with the need to move themselves or a loved one into a skilled nursing facility.

A similar forced arbitration agreement in a Florida Manor Care nursing home lawsuit was found unenforceable in 2011. A majority of the Florida Supreme Court found that many of the provisions in the agreement, including a $350,000 cap on non-economic damages and an agreement that the resident could never receive punitive damages, violated Florida law and could not be enforced.