An Ohio state appellate court has found a nursing home agreement unconscionable where the right to attorney's fees, punitive damages, and a jury trial were waived by an aged and allegedly unsophisticated nursing home resident.

In Hayes v. Oakridge Home, No. 89400, 2008 WL 525411 (Ohio Ct. App. Feb. 28, 2008), Hayes was admitted to Oakridge's nursing home facility. Upon admission, Hayes and Oakridge executed two arbitration agreements.

Hayes later filed a court complaint alleging reckless or negligent care by Oakridge. Oakridge moved to compel arbitration and stay the proceedings. The trial court granted the motion.

On appeal, the Court examined the arbitration agreements for substantive unconscionability. The Court considered the agreements' prohibition on the recovery of attorney's fees and punitive damages and its jury trial waiver as substantively unconscionable. The Court also found procedural unconscionability, relying on Hayes's lack of sophistication and advanced age, as well as the complexity of the "myriad of terms" and "numerous forms" comprising the agreements.

In a strongly worded dissent, one judge disagreed with the majority's findings, characterizing the agreements as clear and finding nothing within them "that would rise to the level of unconscionability." The dissenting judge noted that Hayes had presented no evidence demonstrating a lack of legal capacity at the time of contracting. Furthermore, the dissenting judge found that the agreements were voluntary, were not conditions to admission, gave opportunities to rescind, and clearly warned of the jury trial waivers within the documents.