Sandra Kay Hunter v. Lowndes County Health Services ( 2020 )

THIRD DIVISION
MCFADDEN, C. J.,
DOYLE, P. J., and HODGES, J.
NOTICE: Motions for reconsideration must be
physically received in our clerk’s office within ten
days of the date of decision to be deemed timely filed.
Please refer to the Supreme Court of Georgia Judicial
Emergency Order of March 14, 2020 for further
information at (https://www.gaappeals.us/rules).
June 4, 2020
In the Court of Appeals of Georgia
A20A0322. HUNTER et al. v. LOWNDES COUNTY HEALTH DO-011
SERVICES, LLC.
DOYLE, Presiding Judge.
Sandra Kay Hunter, individually and as administratrix of the estate of her
deceased daughter, Kasey Lynn Welch, sued Lowndes County Health Services, LLC,
d/b/a Parkwood Developmental Center (“LCHS”) for wrongful death after Kasey died
as a result of choking while a patient at LCHS’s facility. LCHS moved to compel
arbitration, and the trial court granted the motion. Hunter appeals, arguing that the
trial court erred by granting the motion to compel arbitration because the arbitration
agreement is unenforceable based on a lack of consideration, LCHS’s failure to sign
it, and Kasey’s failure to assent to it either at the time Hunter signed it or after Kasey
reached the age of majority. For the reasons that follow, we reverse.
The record shows that Parkwood, a residential care facility, is operated by
LCHS. Kasey, who was born in August 1994, had characteristics of “severe autism,”
developmental delays, mood swings, and “impaired decision-making,” and she
exhibited aggressive and self-injurious behaviors. On July 13, 2006, Hunter admitted
11-year-old Kasey to Parkwood, where she remained until her death approximately
9 years later. At the time of the admission, Kasey resided with Hunter, who had
“ultimate decision-making authority” for all major decisions pertaining to Kasey
pursuant to the child custody provisions of the divorce decree between Hunter and
Kasey’s father. At or around the time of the admission, Hunter executed multiple
documents on Kasey’s behalf, including: an admission application ; an
“Authorization, Consent, and Release” authorizing Parkwood to facilitate Kasey’s
medical treatment, open and read her mail, and release her information to third parties
deemed by Parkwood to be in Kasey’s best interests ; an admission agreement ; and
an arbitration agreement (“the Agreement”).
In the Agreement, Kasey and Parkwood were handwritten in as parties thereto.
Although each of the two pages contained a block for initials, they were left blank.
Hunter signed the Agreement as “Resident’s Authorized Representative,” but she did
not date it. There was a signature block for “Facilty’s Authorized Agent,” but no one
2
signed the Agreement on behalf of LCHS or Parkwood, nor was the “Facility’s
Authorized Representative” identified by name.
The Agreement provides, in relevant part, that
any and all controversies, claims, disputes, disagreements[,] or demands
of any kind (referred to as a “Claim” or “Claims”) arising out of or
relating to the Resident’s Admission Agreement with the Facility (the
“Admission Agreement”) or any service or care provided to the Resident
by the Facility shall be settled exclusively by binding arbitration. This
means the parties are waiving their right to a trial before a jury or judge.
...
The parties intend that this Arbitration Agreement shall benefit and be
binding upon the parties, their successors and assigns, including the
agents, employees of the Facility, and anyone whose Claim is derived
through or on behalf of the Resident, including without being limited to,
any parent, spouse, child, guardian, executor, administrator, legal
representative, or heir of the Resident.
Kasey reached the age of majority on August 17, 2012. On August 31, 2015,
21-year-old Kasey choked while eating dinner in the Parkwood dining room, and she
died the following day.
On May 3, 2017, Hunter’s attorneys sent a letter to LCHS making a settlement
demand in regard to her claims relating to Kasey’s death, mentioning therein a
3
previous letter in February 2017 to LCHS regarding settlement. The letter also stated
that Hunter considered the Agreement to be unenforceable because it was not signed
by LCHS and lacked consideration, but she was nonetheless withdrawing her 2006
assent to arbitrate based on the Agreement. On June 8, 2017, Hunter, individually and
as administratrix of Kasey’s estate, filed the instant action against LCHS for
malpractice and wrongful death.1 On July 13, 2017, LCHS moved to compel
arbitration, which Hunter opposed on several grounds. The trial court granted the
motion in an order prepared by LCHS’s attorneys but issued a certificate of
immediate review. This Court granted Hunter’s interlocutory application, and this
appeal followed.
1. Hunter argues that the trial court erred by granting LCHS’s motion to compel
arbitration because it was unenforceable. We agree.
“Arbitration is a matter of contract, meaning that arbitrators derive their
authority to resolve disputes only from the parties’ agreement.”2
1
Hunter also named as defendants The Hospital Authority of Valdosta and
Lowndes County, Georgia, d/b/a South Georgia Medical Center. These entities are
not parties to this appeal.
2
(Citation and punctuation omitted.) Brooks Peanut Co. v. Great Southern
Peanut, 322 Ga. App. 801, 809 (3) (746 SE2d 272) (2013).
4
Whether a valid and enforceable arbitration agreement exists is a
question of law for the court. We therefore review a trial court’s order
granting or denying a motion to compel arbitration de novo. [LCHS], as
the part[y] seeking arbitration, bear[s] the burden of proving the
existence of a valid and enforceable agreement to arbitrate. And the
validity of an arbitration agreement is generally governed by state law
principles of contract formation.3
In Georgia, “[t]o constitute a valid contract, there must be parties able to
contract, a consideration moving to the contract, the assent of the parties to the terms
of the contract, and a subject matter upon which the contract can operate.”4 Pursuant
to OCGA § 13-3-2, “[t]he consent of the parties being essential to a contract, until
each has assented to all the terms, there is no binding contract; until assented to, each
party may withdraw his bid or proposition.”
[When] determining if parties had the mutual assent or meeting
of the minds necessary to reach agreement, courts apply an objective
theory of intent whereby one party’s intention is deemed to be that
meaning a reasonable man in the position of the other contracting party
would ascribe to the first party’s manifestations of assent, or that
meaning which the other contracting party knew the first party ascribed
3
(Citation and punctuation omitted.) McKean v. GGNSC Atlanta, 329 Ga. App.
507, 509 (1) (765 SE2d 681) (2014).
4
OCGA § 13-3-1.
5
to his manifestations of assent. In some instances, the only conduct of
the parties manifesting intent is the express language of the agreement.
In other instances, the circumstances surrounding the making of the
contract, such as correspondence and discussions, are relevant in
deciding if there was a mutual assent to an agreement, and courts are
free to consider such extrinsic evidence.5
LCHS relies on Aaron v. United Health Svcs. of Ga., Inc.6 to support its claim
that its failure to sign the Agreement does not render it unenforceable because the
parties’ actions demonstrate their mutual assent. But Aaron is physical precedent
only, and therefore not binding.7 It is also factually distinguishable. In Aaron, a
5
(Citations and punctuation omitted.) Cox Broadcasting Corp. v. Nat.
Collegiate Athletic Assn., 250 Ga. 391, 395 (297 SE2d 733) (1982). See also Del
Lago Ventures v. QuikTrip Corp., 330 Ga. App. 138, 144 (2) (764 SE2d 595) (2014).
(“Assent to the terms of a contract may be given other than by signatures. . . . If one
of the parties has not signed, his acceptance is inferred from a performance under the
contract, in part or in full, and he becomes bound.”) (citation and punctuation
omitted).
6
349 Ga. App. 563, 565 (826 SE2d 442) (2019).
7
See Court of Appeals Rule 33.2 (a) (“If an appeal is decided by a division of
this Court, a published opinion in which all three panel judges fully concur is binding
precedent. An opinion is physical precedent only (citable as persuasive, but not
binding, authority), however, with respect to any portion of the published opinion in
which any of the panel judges concur in the judgment only, concur specially without
a statement of agreement with all that is said in the majority opinion, or dissent.”).
6
nursing home seeking to enforce an arbitration agreement failed to sign it.8 The
nursing home prepared the agreement and presented it to the patient’s son during the
admission process, and the son signed it pursuant to a power of attorney.9 After the
patient’s death, her son sued the nursing home for wrongful death and several other
claims, and the nursing home moved to compel arbitration. The trial court granted the
motion, and this Court affirmed, noting that the nursing home filled in the intended
date of execution and tailored the contract language to the parties.10 The Court also
pointed out that the nursing home filed its motion to compel on the same date it filed
its answer, thereby “[seeking] to enforce the [arbitration a]greement at its first
available opportunity.”11
Here, the Agreement was not dated, nor did LCHS sign it. And although Hunter
advised LCHS that she intended to pursue a claim, LCHS did not express its assent
to the Agreement notwithstanding its failure to sign it nor did it seek to enforce it
8
See Aaron, 349 Ga. at 564.
9
See id.
10
See id. at 565-566.
11
Id. at 566.
7
before Hunter revoked her agreement to arbitrate.12 Because Hunter revoked her
assent, there was nothing for LCHS to assent to and thus no meeting of the minds;
therefore, the Agreement was unenforceable when LCHS sought to compel
arbitration.13 Accordingly, the trial court erred by granting LCHS’s motion to compel
arbitration.
2. Based on our holding in Division 2, we need not address Hunter’s remaining
enumerations of error.
Judgment reversed. McFadden, C. J., and Hodges, J., concur.
12
Although Welch was a patient at Parkwood for many years before her death,
thereby enjoying the benefits of the admission agreement signed on her behalf by
Hunter, there is no evidence in the appellate record that LCHS took any steps to
convey its intent to assent to the arbitration agreement until after Hunter revoked her
assent. The trial court’s conclusion that LCHS stipulated in judicio to the agreement
in its reply brief in support of its motion to compel does not impact the outcome of
this case because Hunter had already revoked her assent at that time.
13
See TranSouth Financial Corp. v. Rooks, 269 Ga. App. 321, 324 (1) (604
SE2d 562) (2004) (holding that an unsigned arbitration clause is unenforceable);
Aaron, 349 Ga. App. at 566-568 (Hodges, J., dissenting). See also United Health
Svcs. of Ga., Inc. v. Alexander, 342 Ga. App. 1, 1-5 (a) (802 SE2d 314) (2017)
(holding that an arbitration agreement between nursing home and daughter of a
patient was unenforceable because there was no assent by the daughter to the
agreement based on the daughter’s lack of express or implied authority to bind the
patient).
8