Another day, another decision by the California Court of Appeal making it more difficult for residential care facilities for the elderly (“RCFEs”) to enforce their arbitration agreements.
Upon admission to virtually any RCFE, a new resident will be asked to sign a stack of documents including an agreement to submit any future dispute to arbitration. Most RCFEs, understandably, would prefer to resolve their disputes in the relatively controlled environs of arbitration rather than take their chances on the unpredictable nature of courtroom litigation.
Notwithstanding that preference, a series of recent decisions have complicated matters for California RCFEs by curtailing the enforcement of arbitration agreements. The courts have held that arbitration agreements signed on a resident’s behalf by family members, conservators, and even attorneys-in-fact may not be enforceable against the resident.
Now, in Rogers v. Roseville SH, LLC (2022) 75 Cal.App.5th 1065, the Court of Appeal has examined the issue from a common law agency perspective, and held that, absent some affirmative conduct by the resident to indicate that an agency relationship exists, a family member signing an arbitration agreement on the resident’s behalf is not acting as the resident’s agent, and the arbitration agreement is unenforceable.