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The Georgia Court of Appeals held that a nursing home resident was not bound by an arbitration agreement signed by her husband because the husband had no actual or apparent authority to enter the arbitration agreement on her behalf.
In Ashburn Health Care Center, Inc v. Poole, No. A07A0572, 2007 WL 1764217 (Ga. Ct. App. June 20, 2007), Poole's mother broke her leg while residing in a nursing home owned by Ashburn Health Care (Ashburn). She subsequently died, and Poole sued Ashburn for wrongful death.
Ashburn filed a motion to compel arbitration pursuant to an arbitration agreement that the decedent's husband signed during her admission to the nursing home. The trial court denied the motion.
On appeal, Ashburn argued that the arbitration agreement was valid because the decedent's husband was acting as her apparent agent in the admission process. However, the decedent was not present when her husband signed the agreement, so in rejecting this argument, the Court explained that apparent authority arises from the acts of the alleged principal, not the alleged agent. The Court also noted that marriage alone does not establish an agency relationship.
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