A Tennessee appellate court determined that a nursing home resident's attorney-in-fact did not have the authority to assign the power to enter into an agreement to arbitrate to another individual.

In Jones v. Kindred Healthcare Operating, Inc., No. W2007-02568-COA-R3-CV, 2008 WL 3861980 (Tenn. Ct. App. Aug. 20, 2008), Marie Hurst executed a durable power of attorney and named her daughter Brenda as her attorney-in-fact. Hurst's health deteriorated and she required nursing home care. Brenda composed a letter which conveyed the power to make medical and financial decisions to her sister, Rebecca.

Rebecca secured admission for Hurst into a Kindred Healthcare (Kindred) nursing home. At the time of admission Rebecca signed a number of forms, including an agreement to arbitrate. Neither Hurst nor Brenda were present during the admission process.

Hurst died while a resident at Kindred. Vicky, another of Hurst's daughters, sued Kindred Healthcare for medical malpractice and wrongful death. Kindred Healthcare moved to compel arbitration pursuant to the admission contract.

The trial court denied Kindred's motion and concluded that the power of attorney assignment was not sufficient to assign the power to enter into an arbitration agreement to another.

The Court noted that the record clearly reflected that Brenda possessed a durable power of attorney from Hurst. Under the power of attorney, Brenda was authorized to handle Hurst's financial and personal affairs. Under Tennessee law, an attorney-in-fact is authorized to carry out the duties delegated by the principal.

Kindred argued that Brenda had the authority to delegate her powers to her sister, Rebecca. However, Vicky contended that Kindred's interpretation of the attorney-in-fact statutes was too broad.

The Court accepted Vicky's argument. The Court noted that duties delegated to the attorney-in-fact include the authority to hire lawyers, real estate agents, and similar service providers. The employment of these types of individuals is directly related to managing the financial and personal affairs of the principal, but is not a delegation of the underlying duties of the attorney-in-fact.

Hurst chose Brenda to act on her behalf. Nothing in the power of attorney suggested that Hurst granted Brenda the authority assign her responsibilities to another. The Court further noted that performance of acts that are ministerial or mechanical may be delegated to another. However, decisions that require the exercise of judgment and discretion cannot be delegated.

The decision of waiving one's right to a jury trial must be considered a decision that requires the exercise of judgment and discretion. Hurst chose Brenda to act as her attorney-in-fact and Brenda could not assign her responsibilities to Rebecca. Accordingly, the Court upheld the trial court's decision.