VINCENT STEVEN ONDROF, ETC. VS. CSL SUMMIT, LLC (L-2063-19, UNION COUNTY AND STATEWIDE) ( 2021 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-2223-20
VINCENT STEVEN ONDROF,
through LAURIE ADAMSKI,
power of attorney,
Plaintiff-Respondent,
v.
CSL SUMMIT, LLC, d/b/a SPRING
MEADOWS SUMMIT, CAPITAL
SENIOR LIVING PROPERTIES,
INC.,1 WELLTOWER NNN
GROUP, LLC, CSL SM SUMMIT,
LLC, CAPITAL SPRING
MEADOWS, LLC,2 and CAPITAL
SENIOR LIVING CORPORATION, 3
Defendants-Appellants.
______________________________
Argued September 21, 2021 – Decided November 15, 2021
Before Judges Fisher and DeAlmeida.
1
Improperly pleaded as "Living Properties Capital Senior."
2
Improperly pleaded as "Meadows LLC Capital Spring."
3
Improperly pleaded as "Living Corp. Capital Senior."
On appeal from the Superior Court of New Jersey, Law
Division, Union County, Docket No L-2063-19.
Michael R. Ricciardulli argued the cause for appellants
(Ruprecht, Hart, Ricciardulli & Sherman, LLP,
attorneys; Michael R. Ricciardulli, of counsel and on
the briefs; Brion D. McGlinn, on the briefs).
Jonathan F. Lauri argued the cause for respondent
(Stark & Stark, PC, attorneys; Jonathan F. Lauri, of
counsel and on the brief).
PER CURIAM
Plaintiff Vincent Steven Ondrof commenced this action, alleging
defendants (hereafter "Spring Meadows"), a Summit assisted living facility in
which he resides, provided negligent care and caused him personal injuries.4
Spring Meadows claims the existence of an enforceable arbitration agreement,
alluding to such provisions among the many documents Ondrof either signed or
which were signed on his behalf, even though the inclusion of an arbitration
agreement in such a contract violates New Jersey law. See N.J.S.A. 30:13-8.1
(declaring that "[a]ny provision or clause waiving or limiting the right to sue for
negligence or malpractice in any admission agreement or contract between a
4
Ondrof alleges all the named defendants are the owners and operators of an
assisted living facility on Springfield Avenue in Summit in which he resided and
was allegedly negligently cared for. We need not attempt to ascertain which one
or more than one of these defendants is the owner and operator and only, for
convenience sake, do we refer to defendants collectively as Spring Meadows.
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patient and . . . [an] assisted living facility . . . is hereby declared to be void as
against public policy and wholly unenforceable").5 Spring Meadows was unable
to convince the trial judge to stay the action and compel arbitration, and now
appeals, as of right, arguing the trial judge erroneously: (1) "relied on the
absence of a power of attorney" in concluding Ondrof's daughter – Laurie
Adamski – did not have authority to bind him to the clauses that called for the
waiver of a jury trial and mandatory arbitration; (2) failed to apply equitable
doctrines that would preclude Ondrof from claiming the arbitration agreement
is unenforceable; and (3) failed to recognize that Ondrof's "signature to the
5
We are mindful that when a party seeks to compel arbitration, the Federal
Arbitration Act (FAA), 9 U.S.C.A. §§ 1-16, when applicable, negates the
significance of N.J.S.A. 30:13-8.1. That is, when the FAA applies to an
arbitration agreement – and we assume only for the moment that it applies here
despite the lack of an obvious federal interest – a contrary state policy against
enforcement of an arbitration agreement in the context of a nursing home or
assisted living facility will have no effect. See Marmet Health Care Ctr., Inc. v.
Brown, 565 U.S. 530, 533 (2012); Kleine v. Emeritus at Emerson, 445 N.J.
Super. 545, 547 (App. Div. 2016); Estate of Ruszala v. Brookdale Living
Cmtys., Inc., 415 N.J. Super. 272, 292-93 (App. Div. 2010). But, contrary to
Spring Meadows' responses to our inquiries during oral argument, the FAA did
not remove N.J.S.A. 30:13-8.1 from our statutory law. And the FAA has not
been shown to have altered our lawmakers' hostile view toward agreements like
this. It only makes New Jersey's policy ineffectual when considering whether to
enforce an arbitration agreement governed by the FAA. Facilities, like Spring
Meadows, that fall within the ambit of N.J.S.A. 30:13-8.1, remain bound to its
prohibition and we would think they run the risk of other ramifications when
violating New Jersey law by extracting such agreements from their clients. See
Kleine, 445 N.J. Super. at 548 n.5.
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agreement was binding upon him, separate and apart from . . . Adamski's
signature." Because we find from the record a genuine factual dispute
surrounding the formation and content of the parties' contractual undertaking,
we vacate the order denying Spring Meadows' motion and remand for an
evidentiary hearing to determine the enforceability of the agreement on which
Spring Meadows relies.
I
To explain, we start with (a) a brief recitation of some undisputed, relevant
facts, and then describe (b) the contract documents in question and what was
and wasn't executed by the parties, as well as (c) a description of the parties'
factual disputes about contract formation, and lastly provide (d) a brief
description of the trial judge's holding.
A
Ondrof was seventy-six years old in 2016 when he fell and sustained
injuries in his home.
While Ondrof was recovering in a rehabilitation center, his daughter,
Adamski, explored alternative future living arrangements on her father's behalf
and, in that regard, met with Donna Brito, Spring Meadows' executive director.
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B
At some point, Brito presented Adamski with contract documents,
including those labeled: "responsible party agreement," "residence and service
agreement," "binding arbitration agreement," and "resident signature page,"
among others. The entire collection of documents consisted of forty-seven
pages.
The "responsible party agreement" declares, among other things, that:
• Spring Meadows "prefers" that the resident
appoint a power of attorney to serve as the
responsible party to handle the resident's funds,
execute documents and participate in care
decisions;
• by signing the "Residence and Service
Agreement and/or this Responsible Party
Agreement," the responsible party
"acknowledges" that he or she "has been
authorized" by the resident, "or designated by
law, to enter into and bind" the resident to the
residence and service agreement;
• the responsible party "acknowledges and agrees
that [he or she] is executing the Residence and
Service Agreement (including the Binding
Arbitration Agreement) and Responsible Party
Agreement in individual and representative
capacities"; and
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• by executing, the signer "understands and
acknowledges" that Spring Meadows is "relying
upon the above warranties, representations, and
agreements in admitting" the resident, and if the
warranties and representations "are not true, or if
the above agreements are not complied with,"
Spring Meadows "will have detrimentally relied
upon them and . . . will suffer financial harm and
loss."
This "responsible party agreement" is undated. It is signed by Adamski and
Brito. Ondrof's signature does not appear on this document.
The "binding arbitration agreement" is five pages long. Above its title6 is
the phrase "Attachment I,"7 suggesting it may have been intended to be part of
something else to which it would eventually be appended. In large letters this
document instructs that it should be read "carefully" and recommends the
signing party "consult with an attorney, family, and/or friends before choosing
to sign." In broad language, the document expresses that, by signing, the parties
agreed to arbitrate "any action, dispute, claim or controversy of any kind . . .
arising out of the provision of goods, services or items provided under the terms
6
We assume the title "binding arbitration agreement" was intended to convey
that, by signing, the parties agreed to "binding arbitration," not that their
arbitration agreement is "binding."
7
To be clear, this attachment designation is not Roman numeral I but the letter
I, as revealed by the fact that the responsible party agreement is designated
attachment G.
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of this or any other agreement between the [p]arties, or any other dispute
involving acts or omissions that cause damage or injury to either [p]arty. . . ."
Also in large print, the document states that, by signing, the parties:
ARE GIVING UP AND WAIVING THEIR
CONSTITUTIONAL RIGHT TO HAVE ANY CLAIM
OR DISPUTE DECIDED IN A COURT OF LAW OR
EQUITY BEFORE A JUDGE AND/OR JURY.
Adamski and Brito signed this document and dated it October 6, 2016, even
though they dispute the date it was signed. Ondrof's signature does not appear
on this five-page document.
The text of the "resident signature page" states that "[t]he undersigned
each acknowledge that he/she has received the Residence and Service
Agreement and all Attachments and each understands and voluntarily agrees to
all of the terms contained herein." This is the only document containing Ondrof's
signature.
Adamski signed the "resident signature page" as the "resident's
responsible party"; in that location, the document anticipates the signer's
checking of one of a number of boxes labeled: "Guardian/Conservator," "Power
of Attorney/Health Care Agent," "Spouse," and "Other." Adamski checked
"[o]ther" and wrote the word "daughter" alongside. Brito signed for Spring
Meadows as its "authorized agent"; in the box containing her signature is an
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unchecked box which states: "Resident or Responsible Party must also sign
Attachment I (Binding Arbitration Agreement)." The document states that
Ondrof and Adamski signed this page on October 2, 2016, and Brito signed on
October 16, 2016.
Because Ondrof did not sign the arbitration agreement, because the parties
present colorable arguments about the scope of Ondrof's signature on the
"resident signature page," and because the parties dispute Adamski's authority
to bind Ondrof when she signed the other documents, including the arbitration
agreement, we must consider the parties' factual contentions to first determine
whether Ondrof should be bound to the arbitration agreement. After careful
examination of the record, we are satisfied there are numerous genuine disputes
of material facts that preclude a disposition of these issues. To explain, we
examine the parties' competing allegations about the execution of the
documents.
C
Plaintiff's version. According to Adamski, after touring the facility, Brito
presented her with the "assisted living community" form and the "resident
signature page" with the comment that the latter would have to be executed
before Ondrof could be admitted; Brito did not advise that this "resident
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signature page" was part of a larger agreement. Adamski later presented the
"assisted living community" form and the "resident signature page" to her father;
they both signed it and Adamski returned these documents to Spring Meadows.
On October 6, 2016, Brito advised Adamski that she needed to sign
additional paperwork before Ondrof could be admitted. The next day, Brito
presented Adamski with the "residence and service agreement" and its
attachments, which – at this point – included the "responsible party agreement"
and the "binding arbitration agreement," all of which contained tabs at the places
where a signature was required. Adamski claims Brito never explained the
contents of these documents, some of which, including the "binding arbitration
agreement," had not been previously provided. Adamski signed her own name
where indicated; Ondrof signed none of these. Relying on these facts, Ondrof
argues he never agreed to arbitrate.
On whether her signature could bind Ondrof, Adamski asserted that Brito
was well aware that she then did not possess a power of attorney for her father.
Indeed, according to Adamski, Brito had recommended Adamski thereafter
obtain a power of attorney, which Adamski obtained, but not until three months
had passed.
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Spring Meadows' version. Spring Meadows disputes the facts urged by
Ondrof. Spring Meadows claims both Ondrof and Adamski were present during
the initial meeting with Brito in early October 2016. At that time, according to
Brito, she gave them both a blank copy of the "residence and service agreement,"
with all the other documents appended, so they could review the entire contract
before signing. Brito claims both Ondrof and Adamski later returned to sign and
that Adamski advised she held Ondrof's power of attorney. 8 Brito claims to have
explained the contractual documents and answered Ondrof's and Adamski's
questions. She claimed she did not seek or obtain Ondrof's signature on all the
documents because Ondrof told Adamski, in their presence, that Adamski could
sign for him. Spring Meadows offered no explanation why – if Ondrof then and
there authorized Adamski to sign for him – he would have then signed the
"resident signature page" or why Ondrof's signature did not bear the date of this
alleged meeting.
D
8
Brito acknowledged that she did not receive the power of attorney from
Adamski until January 2017. She claimed that she did not sufficiently review in
January 2017 the power of attorney and, thus, did not learn that Adamski did not
hold a power of attorney during the earlier October events.
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We discern from his opinion that the linchpin to the judge's refusal to
enforce the arbitration agreement in light of these conflicting factual allegations
was a combination of the absence of Ondrof's signature on that particular
document, Ondrof's undisputed competence to execute agreements, and the
absence of a power of attorney in favor of Adamski at that point in time. In the
last respect, the judge alluded to and relied on N.J.A.C. 8:36-4.1(a)(18), which
declares that a resident of an assisted living facility has:
The right to manage his or her own finances or to have
that responsibility delegated to a family member, an
assigned guardian, the facility administrator, or some
other individual with power of attorney. The resident's
authorization must be in writing, and must be witnessed
in writing.
From this the judge concluded that in the absence of a power of attorney ,
Adamski was powerless to bind Ondrof.
II
In appealing the interlocutory order as of right, R. 2:2-3(a), Spring
Meadows contends the trial judge mistakenly relied on the absence of a power
of attorney, failed to equitably or judicially estop Ondrof and Adamski from
arguing the absence of Adamski's authority, and failed to find that Ondrof's
signature on one of the handful of documents was enough to bind him to the
others.
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In considering whether to enforce an arbitration agreement, a court must
first apply state law principles in determining whether there was an agreement
to arbitrate. That is, "arbitration is a matter of contract," Rent-A-Center, W., Inc.
v. Jackson, 561 U.S. 63, 67 (2010), and there should be a resort to state contract
law principles when ascertaining whether the parties had a meeting of minds,
Atalese v. U.S. Legal Servs. Grp., L.P., 219 N.J. 430, 442-44 (2015); see also
Flanzman v. Jenny Craig, Inc., 244 N.J. 119, 137 (2020). Put more plainly, the
policy favoring arbitration has no application when parties haven't agreed to
arbitrate. Volt Info. Scis. v. Bd. of Trs. of Leland Stanford Jr. Univ., 489 U.S.
468, 478 (1989); Atalese, 219 N.J. at 442. After close review of the parties'
competing versions of the events encircling the formative stage of whatever they
had agreed on, we are satisfied there are factual disputes that are so material that
there must be an evidentiary hearing to resolve whether Ondrof on his own or
through an authorized representative agreed to arbitrate any disputes with Spring
Meadows. And so, we reject both Spring Meadows' argument that the record
demonstrates the enforceability of the arbitration agreement and Ondrof's
argument that the record lacks an enforceable arbitration agreement.
To be sure, the uncertainty surrounding the parties' interactions is largely
a product of Spring Meadows' attempt to secure a binding agreement through a
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series of contractual documents rather than a process by which it presented one
contract at one time for execution. While it is not our role or desire to instruct
an assisted living facility on how to go about extracting enforceable arbitration
agreements from its clientele, it certainly wasn't helpful to Spring Meadows'
cause that it went about obtaining such an agreement by proposing the execution
of a series of documents rather than a single, understandable, and fully-
integrated contract for execution.
The same holds true for the parties' disputes about the presence or extent
of Adamski's authority to speak for or bind her father to any of the contract
documents presented by Spring Meadows. It is noteworthy that Spring
Meadows' own documents express a preference that the resident issue a power
of attorney for someone to act on his behalf. Yet, by failing to ensure Adamski
was sufficiently empowered, Spring Meadows was relegated to an attempt to
persuade the court on a less than certain record that Adamski had sufficient
authority to bind Ondrof to an agreement to arbitrate. The contract documents
themselves demonstrate the absence of clarity and the need for a plenary
hearing. As we noted, from the options on the "resident signature page" for
identifying her relationship to the resident, Adamski chose "other," not "power -
of-attorney," and described herself as "daughter." Unless and until Spring
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Meadows can demonstrate at the plenary hearing that Adamski had far greater
authority than whatever authority a daughter may have over a father, defendant's
argument that Adamski's signing as Ondrof's daughter was sufficient authority
to bind Ondrof must fail. We are cognizant that other material in the executed
contract documents may suggest an expression of a greater authority, but the
weight to be given to such expressions must await an illumination of the parties'
intentions to be explored at the plenary hearing for which we remand. We view
in this same vein Spring Meadows' argument that because Ondrof signed one of
the documents he conveyed his consent to all the stipulations in all the other
documents.9 The lack of his signature on other documents – most notably the
9
Indeed, the very language of the "resident signature page," which is the only
document Ondrof signed, does not necessarily capture and incorporate all the
language in the other documents including – most importantly – the arbitration
agreement. That is, the "resident signature page" did not restate in sufficient
language the agreement stated elsewhere about arbitration; this particular page
stated only that by signing Ondrof "acknowledge[s] . . . he . . . has received the
Residence and Service Agreement and all Attachments and . . . understands and
voluntarily agrees to all of the terms contained herein." Spring Meadows '
argument requires numerous leaps of logic that would at least incorporate: (a)
an assumption that Ondrof was aware that an arbitration agreement was
incorporated in the phrase "Residence and Service Agreement and all
Attachments," (b) he in fact understood and voluntarily agreed to an arbitration
agreement somewhere within the "Residence and Service Agreement and all
Attachments," and (c) the word at the end – "herein" – should be understood as
"therein." These assumptions cannot be drawn on this record. The law endorses
a policy in favor of arbitration, but it does not impose on a party the requirement
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arbitration agreement – raises doubt as to whether he intended to agree to
arbitrate any future disputes. Again, this is another matter to be considered at
the plenary hearing.
Spring Meadows also argues for the application of equitable principles in
arguing Adamski's signature was sufficient to bind Ondrof or, even if it wasn't,
that Spring Meadows had the right to assume Adamski was sufficiently
authorized. Spring Meadows refers to both equitable and judicial estoppel
principles as a bar to the position now taken against arbitration. We find Spring
Meadows' judicial estoppel argument lacks sufficient merit to warrant a
discussion in a written opinion. R. 2:11-3(e)(1)(E). We add only that judicial
estoppel serves to preserve the "integrity of the judicial process," Cummings v.
Bahr, 295 N.J. Super. 374, 387 (App. Div. 1996), by prohibiting a party from
advocating "a position contrary to a position it successfully asserted in the same
or a prior proceeding," Kimball Int'l, Inc. v. Northfield Metal Prods., 334 N.J.
Super. 596, 606 (App. Div. 2000) (emphasis added). Even if it could be found
of successfully navigating a shell game. We draw no conclusions except that,
absent further evidence illuminating Ondrof's intent, the "resident signature
page" alone does not support Spring Meadows' argument that Ondrof expressly
agreed to arbitrate any disputes.
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that Adamski had advocated a different position in this case, there is no evidence
she did so successfully.
Defendant's attempt to invoke the doctrine of equitable estoppel, which
may be used against a party that engaged in conduct inducing another to rely to
its detriment, Knorr v. Smeal, 178 N.J. 169, 178 (2003), appears to be based on
its assumptions that: Ondrof ratified the entire agreement by signing in a single
place; or, in the same or similar manner, he delegated his authority to Adamski;
or Adamski somehow led Spring Meadows to believe she had the authority to
bind her father even though her only affirmative statement in the documents –
not the language inserted in the lengthy documents to suggest greater authority
– was her inserting alongside her signature that she was signing as Ondrof's
"daughter."
We have already stated that we find the circumstances surrounding
execution (or lack of execution) of the documents and the manner in which the
parties may or may not have intended to be bound to the arbitration agreement
so fraught with factual disputes and uncertainties as to require a plenary hearing.
The application of equitable estoppel also cannot be applied absent the
revelation of the true facts through the conducting of a plenary hearing. Spring
Meadows may argue, for example, that Adamski should not be now permitted
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to disavow language in one document she did sign that stated – in language
drafted by Spring Meadows – that by signing on a line designated "responsible
party," Adamski represented that "she has been authorized by the resident . . . to
enter into and bind the resident to the Residence and Service Agreement." Even
if that's what Spring Meadows places its reliance on, the judge will have to
consider, among other things, whether Spring Meadows' reliance was reasonable
since the quoted language does not refer to the arbitration agreement . We find it
also difficult to understand – but also leave for the judge's consideration at the
plenary hearing – how defendant could have reasonably relied on a statement
from a resident's daughter, who signed only as the resident's daughter, that she
had authority beyond whatever her familial relationship provided. And, it is also
difficult to understand, but also left for further development in the trial court,
how Spring Meadows could have reasonably relied on a statement of an alleged
agent; the key question to be answered does not concern the purported agent's
acts or statements but the words and conduct of the purported principal. See
Sears Mortg. Corp. v. Rose, 134 N.J. 326, 337-38 (1993); see also Restatement
(Third) of Agency, § 3.01 (Am. Law. Inst. 2006) (recognizing that "[a]ctual
authority . . . is created by a principal's manifestation to an agent that, as
reasonably understood by the agent, expresses the principal's assent that the
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agent take action on the principal's behalf"); id. at § 3.03 (recognizing that
"[a]pparent authority . . . is created by a person's manifestation that another has
authority to act with legal consequences for the person who makes the
manifestation, when a third party reasonably believes the actor to be authorized
and the belief is traceable to the manifestation"). Considering the true facts are
not yet known, we need not further discuss what circumstances might or might
not demonstrate either actual or apparent authority. The thrust of today's holding
is not to resolve those issues but to convey that the emphasis in such an analysis
is not on the signals given by the alleged agent – as constitutes much of Spring
Meadows' argument – but by the signals given by the alleged principal.
In addition, it should not be overlooked that in seeking an equitable
remedy like the imposition of an estoppel, it is incumbent on Spring Meadows
to show that it has acted equitably. "[They] who seek[] equity must do equity."
Thompson v. City of Atlantic City, 190 N.J. 359, 384 (2007). While we are
mindful that N.J.S.A. 30:13-8.1 cannot stand in the way of the enforcement of
an arbitration agreement subject to federal law,10 we see nothing that prevents
application of that strong public policy against what Spring Meadows seeks to
10
We need not decide whether an arbitration agreement that is not governed by
the Federal Arbitration Act but by the New Jersey Arbitration Act, may be held
unenforceable in the face of N.J.S.A. 30:13-8.1.
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do in determining whether it is equitable to estop the resident or his daughter
from claiming they did not agree to arbitrate.
III
To be clear, we decide none of the questions circling about whether
Ondrof agreed to arbitrate or whether his daughter was authorized to bind him
to such an agreement. We instead leave those questions to be further developed
and resolved at a plenary hearing.
The order denying defendant's motion to enforce the arbitration agreement
is vacated and the matter is remanded to the trial court for a plenary hearing in
conformity with this opinion.
Vacated and remanded. We do not retain jurisdiction.
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