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Can a temporary conservator of a person effectively sign paperwork that admits the conservatee to a California senior living facility subject to an arbitration agreement?  Only if the temporary conservator has special authorization to do so.

Holley v. Silverado Senior Living Management, Inc. (2020) ___ Cal.App.5th ___, decided in August, is a cautionary tale for operators of senior living facilities.  Even if a son or daughter has court papers establishing his or her appointment as conservator of mother’s person, the son or daughter may not be able to bind mother to an arbitration agreement that is included in the admissions paperwork.

What happened to Elizabeth?

Elizabeth Holley, age 77, suffered from dementia and other medical problems.  Her children, Diane and James Holley, sought appointment as conservator of her person and the Orange County Superior Court named them as temporary conservators in August 2017.

California courts can appoint temporary conservators when exigent circumstances exist – such appointments operate on an interim basis until the court has completed the evaluation necessary to decide whether a general (longer term) conservatorship should be established.

On October 26, 2017, Diane and James signed a stack of paperwork to admit Elizabeth to Silverado Senior Living in Costa Mesa.  Amongst the papers was an arbitration agreement, which was voluntary and not a condition of admission.  The agreement included a certification that the signer was duly authorized to accept its terms.

Four days later, the Orange County court granted Diane and James’ petition to place Elizabeth in Silverado’s locked facility for patients with dementia.

On November 1, 2017, Elizabeth was admitted to Silverado.  Diane and James filed suit after Elizabeth died in 2018, contending that the facility provided substandard treatment and alleging claims of elder abuse and neglect, negligence and wrongful death.

The defendants petitioned to compel arbitration instead of adjudication in the Superior Court.  The court denied the motion, finding insufficient evidence that Diane and James had authority to bind Elizabeth to arbitration.

What is the power of a temporary conservator of the person to admit a conservatee to a health facility?

The Court of Appeal affirmed lower court ruling on two grounds, thus confirming that defendants could not enforce the arbitration clause.

First, the appellate court reasoned that the duties of temporary conservators are narrower than those who have full-fledged status as general conservators, referencing cautionary instructions in Judicial Council Form GC-348, which describes the duties of conservators.  Authorized by Probate Code section 1834, the form states in part: “A temporary conservator should avoid making long-term decisions or changes that could safely wait until a general conservator is appointed.  As temporary conservator, you may not move a conservatee from his or her home, unless there is an emergency, or sell or give away the conservatee’s home or any other assets without prior court approval.”

Based on this language, the court found that Diane and James could not give up Elizabeth’s important right to use the courts for redress of grievances without court approval.

It’s noteworthy that the court relied on the language of the Judicial Council form instead of the statutory constraints on temporary conservators set forth in Probate Code sections 2252, 2253 and 2254.

Second, the appellate court noted the limitations on a conservator’s authority to make medical decisions without court approval or the conservatee’s consent.  As of October 26, 2017, when the arbitration agreement was signed, Diane and James did not yet have the probate court’s approval to admit Elizabeth to Silverado, nor had the probate court found that Elizabeth lacked capacity to give informed consent to medical treatment.  Thus, even if Diane/James had been general as opposed to temporary conservators, they lacked authority to admit Elizabeth to Silverado without her signatures on the forms.

What’s the takeaway for senior living facilities?

California senior living facilities face many risk management challenges.  In order to enter into enforceable contracts when admitting seniors they will need to accurately evaluate who has authority to sign contract documents.

We previously blogged about the Hutcheson case in which the Court of Appeal refused to enforce an arbitration clause signed by an agent under a personal care power of attorney as the document did not authorize the agent to make medical or health care decisions, including the decision to admit the principal to a care facility.

Now, with Holley, facilities will be need to be wary about accepting signatures from either (1) any temporary conservator of the person, or (2) any conservator of the person who cannot show either that the court has approved the placement or that the court has adjudicated the conservatee’s incapacity to give consent to medical treatment.

More broadly, while Probate Code section 2252(a) generally limits a temporary conservator’s powers to those that are “necessary” in the short term, Holley may be read more broadly to preclude temporary conservators from giving up any “important right” of a conservatee.