The Ohio Supreme Court ruled that an arbitration agreement between the nursing home and a resident that took away many of the resident’s rights was not invalid as a matter of public policy. By signing the arbitration agreement, the resident lost her right to a jury trial, the right to attorney fees, and punitive damages. The Ohio Supreme Court ruled that these provisions are enforceable if they are "voluntarily" entered into and were not pre-conditions to the nursing home’s admission process.
The 95 year old resident was brought by ambulance to the nursing home to be admitted. She was given 29 pages of documents to review and had to sign in 11 different places. The arbitration agreement itself stated that it was voluntary. It indicated that arbitration would save time and expense, but failed to point out the drawbacks of arbitration, i.e. difficulties in forcing the other party to turn over documents prior to arbitration, limited appellate review, and the expense of arbitrators.
However, a majority of the Ohio Supreme Court justices found the agreement to be valid because it was not both procedurally and substantively unconscionable. To be procedurally unconscionable, the residents would have to show that due to their age, education, intelligence, business knowledge, mental status, and emotional condition that they were disadvantaged in fully understanding the agreement or believing that they had no choice but to sign the agreement. To be substantively unconscionable, the agreement must be one-sided and favoring the nursing home over the resident.
The resident had died and could not testify regarding the factors surrounding her signing the document. The only fact on the record was that the resident was 95 years old when she signed. This was not enough to show that the agreement was procedurally unconscionable. As for substantive unconscionability, the court pointed out that both sides gave up their rights to a jury trial as well as the right to recover attorney fees or expenses from the other party.
Justice Pfeifer was the lone dissenting justice. Justice Pfeifer scoffed at the majority’s reasoning, and pointed out that this decision reduced to rubble, the Ohio Nursing Home Patients’ Bill of Rights (R.C. 3721.10, et. seq.) enacted by the Ohio General Assembly to protect nursing home residents from all types of abuses and unsafe conditions. This statute allowed nursing home residents to receive punitive damages and attorney fees when enforcing their rights. Justice Pfeifer pointed out how vulnerable the residents were and how the Ohio General Assembly recognized that they were in need of special protection. Although arbitration makes sense between two business entities, it should be outlawed in the nursing home environment where one side does not understand the implications of the agreement and would not have the abilities to negotiate another result.
Justice Pfeifer ended his dissenting opinion with these caustic remarks:
"[I]f you squint just so, you can make out what the majority identifies today: the right of the elderly to be "taken in" by nursing homes. This court’s corollary right for nursing homes is the right to say, "You signed it. Live with it! Ohio Nursing Home Patients’ Bill of Rights? You waived it! Your fundamental constitutional rights? You waived them too! And don’t forget to remind your son that we need next month’s check for $5,500 by the first."
To read the enter decision, click here.