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Medical records indicating a history of medical decisions being made by one spouse on the other's behalf can establish an implied agency relationship, thus enabling one spouse to bind the other to a medical admission document containing an arbitration agreement, according to the Arizona Court of Appeals.
In Ruesga v. Kindred Nursing Centers, L.L.C., No. 2 CA-CV 2006-0114, 2007 WL 2045458 (Ariz. Ct. App. July 18, 2007), Robert Ruesga was admitted to Kindred's rehabilitation facility after suffering severe health complications. Upon admission to the facility, Mr. Ruesga's wife, Florentine Ruesga, executed documents which included an arbitration agreement applicable to all claims related to Mr. Ruesga's stay in the facility. Mrs. Ruesga signed the agreement on a line labeled "legal representative," and indicated she was his wife on a line labeled "authority and title."
Mrs. Ruesga later sued Kindred for negligence, negligence per se through statutory violations, violations of state law, breach of contract, and fraud, all related to Mr. Ruesga's care in the facility. Kindred filed a motion to compel arbitration, which the trial court initially denied on the basis that the evidence failed to show Mrs. Ruesga was her husband's guardian or had power of attorney.
Subsequent discovery revealed evidence in various medical records that Mrs. Ruesga had an alleged agency relationship with her husband, and Kindred relied on this evidence in moving for relief from the trial court's denial of its motion to compel. In light of the new evidence, the trial court granted Kindred's motion to compel, and Ruesga appealed, arguing that the recently discovered medical records did not show an actual or apparent authority that would enable Mrs. Ruesga to bind her husband to the arbitration agreement.
As an initial matter, the Court rejected the contention that the existence of an agency relationship presented a question of fact for a jury or necessitated an evidentiary hearing. As the Court noted, when the existence of an agreement to arbitrate is challenged, Arizona law requires the court to "proceed summarily to the determination of the issue," which includes conducting an evidentiary hearing to determine whether a factual dispute exists. However, the burden of requesting an evidentiary hearing is on the party claiming a factual dispute. The Court found that since Ruesga failed to request such a hearing, the right to the hearing was thereby waived.
Next, the Court found that the trial court's determination that an agency relationship existed between Mr. and Mrs. Ruesga was not clearly erroneous. While both Ruesga and Kindred agreed that there was no apparent authority, Kindred claimed that the medical record evidence demonstrated actual authority to bind Mr. Ruesga to the arbitration agreement.
The Court rejected Ruesga's claim that the lack of an express contract of agency defeated any finding of agency, and instead found the medical records contained sufficient evidence for the trial court to find actual authority due to an implied agency relationship. The Court focused on the intent of the parties as reflected in the medical record evidence, and found that the medical records "revealed a history of Florentine's acting and making decisions on Robert's behalf." The Court also observed that an express authorization of agency may have been found in Florentine's earlier signature as Robert's "Agent or Legally Authorized Representative." Robert's failure to contest that designation at the time, when he was capable of expressing a contrary intent, supported the finding of an implied agency relationship.
In sum, the Court agreed that "the trial court properly determined that there were sufficient facts to show that both [Robert's] actions and his wife's long history of making decisions on his behalf gave rise to an agency relationship such that [Florentine] could bind her husband to the [arbitration] agreement." Since the trial court's finding was not "clearly erroneous," the Court affirmed the order compelling arbitration.
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