The Tennessee Court of Appeals found that the daughter of a nursing home resident did not have apparent authority to enter an arbitration agreement on her father's behalf because he did nothing to convey the impression that his daughter possessed the requisite authority.

In Hearn v. Quince Nursing & Rehabilitation Ctr., LLC, No. W2007-02563-COA-R3-CV, 2008 WL 4614265 (Tenn. Ct. App. Oct. 16, 2008), McClinton was admitted to Quince's nursing home facility. At the time of admission, McClinton was incompetent, so his daughter, Wilson, executed all admission documents, including an arbitration agreement.

After McClinton passed away, the executor of his estate filed a wrongful death action against Quince. Quince moved to compel arbitration. The trial court found that Wilson had apparent authority to enter the arbitration agreement, but denied the motion to compel on the ground that Quince failed to explain the agreement's legal effect to Wilson.

On appeal, the Court affirmed the order denying the motion to compel on different grounds – namely, that Wilson had no authority to enter the arbitration agreement on her father's behalf.

As in prior cases, the Court found that the decedent's failure to exhibit any sort of act to convey authority to the signatory defeated any claim that the signatory possessed apparent authority. See, e.g., Ricketts v. Christian Care Ctr. of Cheatham County, Inc., No. M2007-02036-COA-R9-CV, 2008 WL 3833660 (Tenn. Ct. App. Aug. 15, 2008); Thornton v. Allenbrooke Nursing & Rehab. Ctr., LLC, No. W2007-00950-COA-R3-CV, 2008 WL 2687697 (Tenn. Ct. App. July 3, 2008).

The Court also held that Quince could not show that Wilson could enter the arbitration agreement as her father's health care surrogate under the Tennessee Health Care Decisions Act. Tenn. Code § 68-11-1806(c)(1). As the Court noted, the Act is not retroactive, and Wilson signed the agreement before the Act's effective date of July 1, 2004.