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A California Appellate Court has enforced a Patient Bill of Rights (PBR) exception to an arbitration clause and has also allowed the wrongful death claims of the deceased patient's heirs to go to trial because they were not parties to the arbitration agreement.
In Fitzhugh v. Granada Healthcare and Rehabilitation Center, LLC, No. A115123, 2007 WL 1272221 (Cal. Ct. App. May 2, 2007), 83-year-old Ruth Fitzhugh was admitted to Granada Healthcare and Rehabilitation Center, LLC (Granada) to convalesce following hip surgery. Within three months, she had broken her leg and died.
Fitzhugh's husband, who as her representative had signed two arbitration agreements upon Ruth's admission--and her two adult sons--filed suit for wrongful death, as well as elder abuse, fraud, and alleged violations of the PBR. Granada sought to enforce the arbitration agreements.
In finding the agreements to arbitrate unenforceable, the Court noted that both agreements expressly excluded any claim related to the PBR. Though Granada tried to argue that the exclusion expired with the patient, the Court disagreed, saying the strong public policy of protecting vulnerable adults allowed for no such reading of the statute.
Given that the PBR portions of the case would need to be tried in court, the Court found that the possibility of conflicting rulings in different forums allowed the trial court to properly exercise its discretionary power to bar arbitration of the remaining issues.
Finally, though the agreements attempted to bind not just the parties and their representatives, but also "their heirs" to its terms, the court ruled that Fitzhugh's husband and sons were not parties to the agreement to arbitrate, and therefore free to pursue their individual wrongful death claims in Court.
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