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Zephyr Haven Health & Rehab Center, Inc. v. Estate of Clukey ex rel. Clukey
Citations: 133 So. 3d 1230; 2014 WL 1016201; 2014 Fla. App. LEXIS 3509Docket: No. 2D12-5978
Court: District Court of Appeal of Florida; March 14, 2014; Florida; State Appellate Court
Zephyr Haven Health and Rehab Center, Inc. appeals the trial court's denial of its motion to dismiss and compel arbitration in a lawsuit filed by Brenda Lee Miller Clukey, acting as personal representative of her late husband Roy Clukey's estate. Mrs. Clukey, using a durable power of attorney, admitted Mr. Clukey to the nursing facility, where he lived for about two and a half years before his death. She subsequently sued Zephyr Haven for violations of nursing home residents' rights, negligence, and wrongful death. The facility sought to enforce an arbitration agreement that Mrs. Clukey signed during admission, which was not a prerequisite for her husband's acceptance into the facility. The trial court ruled that Mrs. Clukey did not have the authority to enter the admission agreement on Mr. Clukey's behalf, citing the durable power of attorney's language that excluded rights to make healthcare decisions. The court also found the arbitration clause unconscionable due to the estate's inability to pay arbitration costs and the manner of the agreement's presentation. On appeal, Zephyr Haven argues against the trial court's ruling on authority, asserting that the durable power of attorney allowed Mrs. Clukey to execute the arbitration agreement, especially since it included authority over "claims and litigation." The court referenced prior rulings that such authority encompasses arbitration agreements. Additionally, the appeal challenges the trial court's findings of unconscionability, arguing that the cost-related issues raised by the estate are similar to those previously dismissed in another case involving Zephyr Haven. The Estate failed to demonstrate that the costs of arbitrating its claim would exceed its litigation expenses, similar to the case in Hardin. The trial court incorrectly found the arbitration agreement to be substantively unconscionable. Since the Estate did not prove substantive unconscionability, the court did not need to address procedural unconscionability. A court must establish both substantive and procedural unconscionability for a party to avoid arbitration on those grounds, as noted in Stewart Agency, Inc. v. Robinson. The trial court also erred in concluding that Mrs. Clukey lacked authority to enter the admissions and arbitration agreements. Consequently, both the finding of substantive unconscionability and the authority issue were incorrect, leading to a reversal and remand for further proceedings.