Cullinane v. Beverly Enters. - Neb. ( 2018 )

Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
08/10/2018 09:09 AM CDT
- 210 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
Thomas Cullinane, as Special A dministrator for the
Estate of Helen Cullinane, deceased, appellee, v.
Beverly Enterprises - Nebraska, Inc., doing business
as Golden LivingCenter - Valhaven, appellant, and
Thomas Larson, Jr., DPM, et al., appellees.
___ N.W.2d ___
Filed June 15, 2018. No. S-17-486.
1. Arbitration and Award. Arbitrability presents a question of law.
2. ____. Whether a stay of proceedings should be granted and arbitration
required is a question of law.
3. Judgments: Jurisdiction. A jurisdictional issue that does not involve a
factual dispute presents a question of law.
4. Judgments: Appeal and Error. When reviewing questions of law, an
appellate court resolves the questions independently of the lower court’s
conclusions.
5. Arbitration and Award: Appeal and Error. The standard of review as
to the issue of arbitrability summarily tried to the court is the same as in
a bench trial of a law action.
6. Judgments: Appeal and Error. In a bench trial of a law action, a trial
court’s factual findings have the effect of a jury verdict and will not be
set aside on appeal unless clearly wrong.
7. ____: ____. In reviewing a judgment awarded in a bench trial of a law
action, an appellate court does not reweigh evidence, but considers the
evidence in the light most favorable to the successful party and resolves
evidentiary conflicts in favor of the successful party, who is entitled to
every reasonable inference deducible from the evidence.
8. Jurisdiction: Appeal and Error. Before reaching the legal issues
presented for review, it is the duty of an appellate court to determine
whether it has jurisdiction over the matter before it, and this is so even
where neither party has raised the issue.
9. Jurisdiction: Final Orders: Appeal and Error. For an appellate court
to acquire jurisdiction of an appeal, there must be a final order entered
- 211 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
by the court from which the appeal is taken; conversely, an appellate
court is without jurisdiction to entertain appeals from nonfinal orders.
10. Federal Acts: Arbitration and Award: Final Orders: Appeal and
Error. In order to determine whether state law governs the finality for
purposes of appeal of an order denying a motion to compel arbitration
under the Federal Arbitration Act, courts must first apply state proce-
dural rules to determine whether the order is final for purposes of appeal
and then determine whether the result of that inquiry would undermine
the goals and policies of the act.
11. ____: ____: ____: ____. A direct appeal from an order denying a motion
to compel arbitration furthers the objectives of the Federal Arbitration
Act by permitting final resolution of the issue of arbitrability without
having to first conclude a judicial proceeding on the merits, at which
point the arbitral remedy would be rendered essentially meaningless.
12. Final Orders: Appeal and Error. Under Neb. Rev. Stat. § 25-1902
(Reissue 2016), the three types of final orders which may be reviewed
on appeal are (1) an order which affects a substantial right and which
determines the action and prevents a judgment, (2) an order affecting
a substantial right made during a special proceeding, and (3) an order
affecting a substantial right made on summary application in an action
after judgment is rendered.
13. Arbitration and Award: Final Orders. The denial of a motion to com-
pel arbitration is a final, appealable order because it affects a substantial
right and is made in a special proceeding.
14. Arbitration and Award. Arbitration is a matter of contract, and a party
cannot be required to submit to arbitration any dispute which he or she
has not agreed so to admit.
15. Federal Acts: Arbitration and Award: Contracts. If arbitration arises
from a contract involving interstate commerce, it is governed by the
Federal Arbitration Act.
16. Constitutional Law: Waiver: Intent. A party has a constitutional
right to adjudication of a justiciable dispute, and the law will not find a
waiver of that right absent direct and explicit evidence of actual intent
of a party’s agreement to do so.
17. Arbitration and Award. Unless the parties clearly and unmistakably
provide otherwise, the question of whether the parties agreed to arbitrate
is to be decided by the court, not the arbitrator.
18. Arbitration and Award: Contracts. Disputes about arbitrability for
a court to decide include threshold questions such as whether the par-
ties are bound by a given arbitration clause or whether an arbitration
clause in a concededly binding contract applies to a particular type of
controversy.
- 212 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
19. Arbitration and Award: Intent. Parties can agree to arbitrate gateway
questions of arbitrability, such as whether the parties have agreed to
arbitrate or whether their agreement covers a particular controversy, if
they do so with clear and unmistakable intent.
20. Arbitration and Award. A valid delegation clause requires the court to
refer a claim to arbitration to the arbitrator to decide gateway arbitrabil-
ity issues.
21. Arbitration and Award: Contracts. Enforcement of an arbitration
agreement involves two analytical steps: The first is contract forma-
tion—whether the parties entered into any arbitration agreement at all.
The second involves contract interpretation to determine whether this
claim is covered by the arbitration agreement.
22. Federal Acts: Arbitration and Award: Words and Phrases. A delega-
tion clause is an agreement to arbitrate a threshold issue and is simply
an additional, severable, antecedent arbitration agreement the party
seeking arbitration asks the court to enforce, and the Federal Arbitration
Act operates on this additional arbitration agreement just as it does on
any other.
23. Federal Acts: Arbitration and Award: Contracts. Arbitration in
Nebraska is governed by the Uniform Arbitration Act as enacted in
Nebraska, but if arbitration arises from a contract involving interstate
commerce, it is governed by the Federal Arbitration Act.
24. Federal Acts: Arbitration and Award. Where a transaction falls within
the scope of the Federal Arbitration Act, the substantive issue of whether
the motion to compel arbitration should be granted is a question of fed-
eral law.
25. ____: ____. Under 9 U.S.C. § 4 (2012) of the Federal Arbitration Act,
the court shall hear the parties, and upon being satisfied that the mak-
ing of the agreement for arbitration or the failure to comply therewith
is not in issue, the court shall make an order directing the parties to
proceed to arbitration in accordance with the terms of the agreement. If
the making of the arbitration agreement or the failure, neglect, or refusal
to perform the same be in issue, the court shall proceed summarily to
the trial thereof, if no jury trial be demanded by the party alleged to be
in default.
26. Arbitration and Award. Under Neb. Rev. Stat. § 25-2603(a) (Reissue
2016), on application of a party showing a valid arbitration agreement
and the opposing party’s refusal to arbitrate, the court shall order the
parties to proceed with arbitration, but if the opposing party denies the
existence of the agreement to arbitrate, the court shall proceed summar-
ily to the determination of the issue so raised and shall order for the
moving party; otherwise, the application shall be denied.
- 213 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
27. Federal Acts: Arbitration and Award. Neb. Rev. Stat. § 25-2603
(Reissue 2016) does not defeat the Federal Arbitration Act’s objective,
expressed in 9 U.S.C. § 4 (2012), that if the making of the arbitration
agreement or the failure, neglect, or refusal to perform the same be in
issue, the court shall proceed summarily to the trial thereon.
28. Appeal and Error. An appellate court will not consider an issue on
appeal that was not passed upon by the trial court.
29. Federal Acts: Arbitration and Award: Contracts. The Federal
Arbitration Act makes arbitration agreements valid, irrevocable, and
enforceable, save upon such grounds as exist at law or in equity for the
revocation of any contract.
30. Contracts: Fraud. In the absence of fraud, one who signs an instrument
without reading it, when one can read and has had the opportunity to do
so, cannot avoid the effect of one’s signature merely because one was
not informed of the contents of the instrument.
31. ____: ____. The doctrine that the carelessness or negligence of a party
in signing a writing estops him or her from afterward disputing the
contents of such writing is not applicable in a suit thereon between the
original parties thereto when the defense is that such writing, by reason
of fraud, does not embrace the contract actually made.
32. ____: ____. Fraud in the execution goes to the very existence of the
contract, such as where a contract is misread to a party or where one
paper is surreptitiously substituted for another, or where the party is
tricked into signing an instrument he or she did not mean to execute.
33. ____: ____. Fraud in the inducement goes to the means used to induce
a party to enter into a contract; in such cases, the party knows the char-
acter of the instrument and intends to execute it, but the contract may be
voidable if the party’s consent was obtained by false representations.
34. Fraud: Proof. A fraudulent misrepresentation claim requires a plaintiff
to establish the following elements: (1) A representation was made; (2)
the representation was false; (3) when made, the representation was
known to be false or made recklessly without knowledge of its truth and
as a positive assertion; (4) the representation was made with the inten-
tion that the plaintiff should rely on it; (5) the plaintiff did so rely on it;
and (6) the plaintiff suffered damage as a result.
35. Fraud. Fraudulent misrepresentations may consist of half-truths calcu-
lated to deceive, and a representation literally true is fraudulent if used
to create an impression substantially false.
36. ____. Whether a party’s reliance upon a misrepresentation was reason-
able is a question of fact.
37. ____. A party is justified in relying upon a representation made to the
party as a positive statement of fact when an investigation would be
required to ascertain its falsity.
- 214 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
38. Fraud: Proof: Circumstantial Evidence. In fraud case, direct evidence
is not essential, but proof of fraud drawn from circumstantial evidence
must not be guesswork or conjecture; such proof must be rational
and logical deductions from facts and circumstances from which they
are inferred.
39. Trial. Under Neb. Rev. Stat. § 25-1127 (Reissue 2016), in the absence
of a request by a party for specific findings, a trial court is not required
to make detailed findings of fact and need only make its findings gener-
ally for the prevailing party.
40. Trial: Judgments: Evidence: Appeal and Error. Where trial is to the
court and no request for specific findings is made, if there is a conflict
in the evidence, an appellate court, in reviewing the judgment rendered,
will presume that controverted facts were decided by the trial court
in favor of the successful party and the findings will not be disturbed
unless clearly wrong.
41. Affidavits. An affidavit is admissible in certain enumerated situations,
including motion practice, which includes the use of affidavits relating
to preliminary, collateral, and interlocutory matters.
42. Judgments: Evidence: Appeal and Error. Even though an appellate
court is, in the absence of oral testimony, equally capable as the trial
court of examining the evidence and drawing conclusions therefrom
and is under a duty to do so, and even though a case was submitted
to the trial court without oral evidence, the duty of the appellate court
to evaluate the facts does not extend to the right or duty to make an
independent evaluation thereof without regard to the findings below.
In such a case, an appellate court is loath to overturn the findings of
an experienced trial judge unless in the opinion of the court they are
clearly wrong.
43. Affidavits. Statements in affidavits as to opinion, belief, or conclusions
of law are of no effect.
Appeal from the District Court for Douglas County: Gregory
M. Schatz, Judge. Affirmed.
Jeanelle R. Lust and Charles E. Wilbrand, of Knudsen,
Berkheimer, Richardson & Endacott, L.L.P., for appellant.
Shayla M. Reed, of Reed Law Offices, P.C., L.L.O., for
appellee Thomas Cullinane.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, and
Funke, JJ.
- 215 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
Funke, J.
Beverly Enterprises - Nebraska, Inc., doing business as
Golden LivingCenter - Valhaven (GLCV), appeals the denial
of its motion to dismiss or stay proceedings and compel
arbitration. GLCV moved to enforce an agreement to arbi-
trate against Thomas Cullinane, as special administrator for
the estate of his mother, Helen Cullinane; Thomas had filed
a wrongful death action against GLCV. Thomas objected to
GLCV’s motion, and the court ruled in his favor, finding the
execution of the “Alternative Dispute Resolution Agreement”
(the ADR Agreement) was not binding upon Helen or her
estate. GLCV appealed, and for the reasons set forth below,
we affirm.
I. BACKGROUND
Helen was a resident of GLCV, a skilled nursing facility
located in Valley, Nebraska. She was 88 years old at the time of
her admission in 2010 and suffered from dementia. She passed
away on February 2, 2015. Thomas became the special admin-
istrator of Helen’s estate and filed a wrongful death action
against GLCV on behalf of the estate.
GLCV filed a motion to dismiss or, in the alternative,
stay proceedings and compel arbitration pursuant to § 4 of
the Federal Arbitration Act (FAA),1 in accordance with the
terms of a written arbitration agreement between GLCV and
Helen. GLCV asserted that Eugene Cullinane, Helen’s hus-
band, age 84, while acting as Helen’s attorney in fact, agreed to
resolve disputes through arbitration when he signed the ADR
Agreement on September 28, 2010, the date Eugene and Helen
were admitted to the facility.
The front page of the ADR Agreement contains a title
written in bold and capitalized letters and large font which
states: “Alternative Dispute Resolution Agreement.” The fol-
lowing language, in bold and capitalized letters, appears
1
9 U.S.C. §§ 1 to 16 (2012).
- 216 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
below the title: “This agreement is not a condition of admis-
sion to or continued residence in the facility.” The ADR
Agreement states:
The Parties agree that any disputes covered by this
Agreement (“Covered Disputes”) that may arise between
them shall be resolved exclusively by an ADR process
that shall include mediation and, where mediation is
not successful, binding arbitration. The parties to this
Agreement acknowledge and agree that upon execu-
tion by Resident, this Agreement becomes part of the
Admission Agreement, and that the Admission Agreement
evidences a transaction in interstate commerce governed
by the [FAA].
The ADR Agreement further includes the following lan-
guage, in bold and capitalized letters:
The parties understand, acknowledge, and agree that
they are selecting a method of resolving disputes without
resorting to lawsuits or the courts, and that by entering
into this agreement, they are giving up their constitutional
right to have their disputes decided in a court of law by a
judge or jury . . . .
The ADR Agreement provides: “Covered Disputes, includ-
ing the determination of the scope or applicability of this
Agreement, shall be determined by arbitration . . . .” A sec-
tion in the agreement titled “Resident’s Understanding” states:
“The Resident understands that . . . his or her signing of this
Agreement is not a condition of admission to or residence in
the Facility . . . .” The signature page of the document states in
bold and capitalized letters and in large font: “This agreement
governs important legal rights. Please read it carefully and in
its entirety before signing.”
At the hearing on GLCV’s motion to compel arbitration,
GLCV offered the affidavit of Trisha Weberg, the business
manager of GLCV. The affidavit included a copy of the
durable power of attorney signed by Helen on July 23, 2008,
which appointed Eugene as her attorney in fact. Weberg, who
- 217 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
was not present when the ADR Agreement was executed,
stated her personal knowledge concerning the facility’s rou-
tine procedure with respect to its resident admissions. Weberg
stated that when she assisted in the admission process, she
would do the following: present the ADR Agreement to the
resident and allow the resident and the resident’s family mem-
bers to read the paperwork; explain that by signing the ADR
Agreement, the resident would waive his or her right to a
trial and agree to submit any dispute to arbitration, but state
that signing the ADR Agreement was not required to become
a resident at the facility; obtain the resident’s signature; and
sign the document on behalf of GLCV. Weberg stated it is her
belief that the normal procedure was followed with regard
to Helen’s admission. GLCV did not present an affidavit
from its employee who executed the ADR Agreement on
its behalf.
Thomas offered affidavits from himself and Eugene.
According to Eugene’s affidavit, he and Helen sought admis-
sion to GLCV when Helen was transferred from the hospital
on September 28, 2010. Helen was taken to a room, and a
GLCV staff member led Eugene and Thomas into a small
office. Eugene stated, “[W]e sat down and the female staff
member presented me with a stack of papers which she said
was ‘the paperwork I needed to sign to admit my wife’ and
another stack to admit myself.” He stated, “The staff member
handled the papers, turned the pages and told me she needed
my signature ‘here’ and directed me where to sign.” Eugene
conceded that he signed the ADR Agreement, but stated that he
did so because it was his understanding that if he did not sign
the paperwork, Helen would not have been admitted to receive
health care. He stated he was not informed that any docu-
ment in the stack of papers was optional, that the paperwork
included an arbitration agreement, or that he was waiving his
or his wife’s right to a jury trial. Eugene stated he would have
not signed the ADR Agreement had he known what it meant
and that it was not required.
- 218 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
Thomas stated in his affidavit that when he and Eugene met
with the staff member in the office, she specifically stated that
“‘these are standard forms we need you to sign.’” Thomas
stated she turned the stack of papers to face Eugene, flipped
up the bottom half of the pages, and pointed to the place where
she wanted him to sign. He stated that he was present during
the entire meeting and that at no time did the staff member
state any of the documents were optional or would have the
effect of waiving legal rights.
Based on the evidence, the district court entered an order
which found that “Eugene[’s] execution of the arbitration
agreement cannot be binding upon Helen . . . , nor her estate,
and that [GLCV’s] motion should be dismissed, and [GLCV]
given two weeks to further plead to [Thomas’] Complaint.”
II. ASSIGNMENTS OF ERROR
GLCV assigns, summarized, that the district court erred in
(1) dismissing GLCV’s motion to dismiss or stay proceed-
ings and compel arbitration, (2) failing to compel Thomas
to arbitration, (3) determining that Eugene’s execution of the
ADR Agreement was not binding upon Helen or her estate,
(4) implicitly ruling that Eugene’s signature was obtained
by fraud, and (5) failing to support its decision with any
legal analysis.
III. STANDARD OF REVIEW
[1-4] Arbitrability presents a question of law.2 Whether a
stay of proceedings should be granted and arbitration required
is also a question of law.3 Likewise, a jurisdictional issue
that does not involve a factual dispute presents a question of
law.4 When reviewing questions of law, an appellate court
2
Citizens of Humanity v. Applied Underwriters, 299 Neb. 545, 909 N.W.2d
614 (2018).
3
Good Samaritan Coffee Co. v. LaRue Distributing, 275 Neb. 674, 748
N.W.2d 367 (2008).
4
State v. Irish, 298 Neb. 61, 902 N.W.2d 669 (2017).
- 219 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
resolves the questions independently of the lower court’s
conclusions.5
[5] We have not yet had the opportunity to determine a
standard of review when the issue of arbitrability is summar-
ily tried to the court. However, we see no reason why the stan-
dard of review would be different from the standard of review
in a bench trial of a law action.
[6,7] In a bench trial of a law action, a trial court’s fac-
tual findings have the effect of a jury verdict and will not
be set aside on appeal unless clearly wrong.6 In reviewing a
judgment awarded in a bench trial of a law action, an appel-
late court does not reweigh evidence, but considers the evi-
dence in the light most favorable to the successful party and
resolves evidentiary conflicts in favor of the successful party,
who is entitled to every reasonable inference deducible from
the evidence.7
IV. ANALYSIS
1. Jurisdiction
[8,9] Before reaching the legal issues presented for review,
it is the duty of an appellate court to determine whether it has
jurisdiction over the matter before it.8 This is so even where,
as here, neither party has raised the issue.9 For an appel-
late court to acquire jurisdiction of an appeal, there must be
a final order entered by the court from which the appeal is
taken; conversely, an appellate court is without jurisdiction to
5
Frohberg Elec. Co. v. Grossenburg Implement, 297 Neb. 356, 900 N.W.2d
32 (2017).
6
See Wynne v. Menard, Inc., 299 Neb. 710, 910 N.W.2d 96 (2018). See,
also, Webb v. American Employers Group, 268 Neb. 473, 684 N.W.2d 33
(2004).
7
Eicher v. Mid America Fin. Invest. Corp., 275 Neb. 462, 748 N.W.2d 1
(2008).
8
Boyd v. Cook, 298 Neb. 819, 906 N.W.2d 31 (2018).
9
Karo v. NAU Country Ins. Co., 297 Neb. 798, 901 N.W.2d 689 (2017).
- 220 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
entertain appeals from nonfinal orders.10 In this case, we must
decide whether the order denying GLCV’s motion to compel
arbitration was a final, appealable order.
Nebraska has adopted the Uniform Arbitration Act (UAA),
which is codified in Neb. Rev. Stat. §§ 25-2601 to 25-2622
(Reissue 2016). Section 25-2603(a) of the UAA authorizes a
party to a judicial proceeding to apply for an order compelling
arbitration of the dispute. The UAA further provides that an
appeal may be taken from an order denying such an applica-
tion, pursuant to § 25-2620(a)(1).11
But GLCV did not invoke the UAA in its motion to compel
arbitration. Instead, GLCV filed its motion to compel arbitra-
tion pursuant to the FAA. Thus, the provision of the UAA
permitting an appeal from an order denying an application to
compel arbitration is inapplicable to this case.
Section 4 of the FAA authorizes a U.S. district court to enter-
tain a petition to compel arbitration if the court would have
jurisdiction, save for the arbitration agreement, over a suit aris-
ing out of the controversy between the parties,12 while § 16 of
the FAA governs appeals and provides in part that “[a]n appeal
may be taken from . . . (1) an order . . . (B) denying a petition
under section 4 of this title to order arbitration to proceed.”13
The FAA, however, does not indicate whether its provisions
relating to appeals are applicable in state court actions, such as
the instant matter, where a party seeks to enforce an arbitration
clause under the FAA.
[10,11] In Webb v. American Employers Group,14 we con-
cluded that in order to determine whether state law governs the
finality for purposes of appeal of an order denying a motion
10
Gillpatrick v. Sabatka-Rine, 297 Neb. 880, 902 N.W.2d 115 (2017).
11
Pearce v. Mutual of Omaha Ins. Co., 293 Neb. 277, 876 N.W.2d 899
(2016).
12
9 U.S.C. § 4.
13
9 U.S.C. § 16.
14
Webb, supra note 6.
- 221 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
to compel arbitration under the FAA, we must first apply our
state procedural rules to determine whether the order is final
for purposes of appeal and then determine whether the result
of that inquiry would undermine the goals and policies of the
FAA. We determined that State procedural rules, which do
not defeat the FAA’s objectives, govern the determination of
whether an order denying a motion to compel arbitration is
final for purposes of appeal.15 We found that a direct appeal
from an order denying a motion to compel arbitration furthered
the objectives of the FAA by permitting final resolution of the
issue of arbitrability without having to first conclude a judicial
proceeding on the merits, at which point the arbitral remedy
would be rendered essentially meaningless.16
[12,13] Under Neb. Rev. Stat. § 25-1902 (Reissue 2016),
the three types of final orders which may be reviewed on
appeal are (1) an order affecting a substantial right in an
action that, in effect, determines the action and prevents a
judgment; (2) an order affecting a substantial right made dur-
ing a special proceeding; and (3) an order affecting a substan-
tial right made on summary application in an action after a
judgment is rendered.17 Ultimately, in Webb, we held that the
denial of a motion to compel arbitration under the FAA is a
final, appealable order under the second of these categories,
because it affects a substantial right and is made during a spe-
cial proceeding.18
In the instant matter, the order denying GLCV’s motion to
compel arbitration was made pursuant to a special proceed-
ing. The order affected GLCV’s substantial rights, namely its
legal, contractual right to the benefits of arbitration, which
15
See id. See, also, Speece v. Allied Professionals Ins. Co., 289 Neb. 75, 853
N.W.2d 169 (2014); Kremer v. Rural Community Ins. Co., 280 Neb. 591,
788 N.W.2d 538 (2010).
16
Webb, supra note 6.
17
In re Interest of Dana H., 299 Neb. 197, 907 N.W.2d 730 (2018).
18
Webb, supra note 6.
- 222 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
right was available to GLCV prior to the court’s order. The
district court’s order is therefore a final, appealable order.
2. ADR Agreement
[14] The U.S. Supreme Court has held that arbitration “‘is
a matter of contract and a party cannot be required to sub-
mit to arbitration any dispute which he has not agreed so to
submit.’”19 Thus, we must determine whether the district court
clearly erred when it determined that the ADR Agreement was
not binding upon Helen or her estate. In order to make that
determination, we must consider whether the ADR Agreement
comes within the scope of the FAA, whether the trial court
had the authority to decide the enforceability of the ADR
Agreement, and whether the trial court used the correct proce-
dure to decide the arbitrability of the agreement.
(a) ADR Agreement Within
Scope of FAA
[15] It is well settled that if arbitration arises from a con-
tract involving interstate commerce, it is governed by the
FAA.20 “Commerce” as defined by the FAA includes “com-
merce among the several States.”21 The U.S. Supreme Court
has held that the phrase “‘“involving commerce”’” requires a
broad interpretation in order to give effect to the FAA’s basic
purpose, which is to put arbitration provisions on the same
footing as a contract’s other terms.22
19
AT&T Technologies v. Communications Workers, 475 U.S. 643, 648, 106
S. Ct. 1415, 89 L. Ed. 2d 648 (1986). See, also, Zweiback Family L.P.
v. Lincoln Benefit Life Co., 299 Neb. 180, 907 N.W.2d 700 (2018), and
Kelley v. Benchmark Homes, Inc., 250 Neb. 367, 550 N.W.2d 640 (1996),
disapproved on other grounds, Webb, supra note 6.
20
Karo, supra note 9; Aramark Uniform & Career Apparel v. Hunan, Inc.,
276 Neb. 700, 757 N.W.2d 205 (2008).
21
9 U.S.C § 1.
22
Webb, supra note 6, 268 Neb. at 478, 684 N.W.2d at 39 (citing Allied-
Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 115 S. Ct. 834, 130 L. Ed.
2d 753 (1995)).
- 223 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
In the instant matter, GLCV brought the motion to com-
pel under § 4 of the FAA. In addition, Thomas’ complaint
alleges that Helen was a resident of Nebraska and that Beverly
Enterprises - Nebraska, Inc., doing business as GLCV, was a
California corporation; the ADR Agreement specifically states
that the admission agreement evidences a transaction involv-
ing interstate commerce; and neither party contends that the
FAA is not the applicable statutory authority. As a result, we
conclude that this case involves a transaction within the scope
of the FAA.
(b) Court Decides Enforceability
of ADR Agreement
[16-18] A party has a constitutional right to adjudication of
a justiciable dispute, and the law will not find a waiver of that
right absent direct and explicit evidence of actual intent of a
party’s agreement to do so.23 “Unless the parties clearly and
unmistakably provide otherwise, the question of whether the
parties agreed to arbitrate is to be decided by the court, not the
arbitrator.”24 This rule creates a rebuttable presumption that
the issue of arbitrability—whether the parties have agreed to
subject a dispute to arbitration—is an issue for judicial deter-
mination.25 Disputes about arbitrability for a court to decide
include threshold questions such as whether the parties are
bound by a given arbitration clause or whether an arbitration
clause in a concededly binding contract applies to a particular
23
Smith Barney, Inc. v. Painters Local Union No. 109, 254 Neb. 758, 579
N.W.2d 518 (1998); Tracy Broadcasting Corp. v. Telemetrix, Inc., 17 Neb.
App. 112, 756 N.W.2d 742 (2008).
24
AT&T Technologies, supra note 19, 475 U.S. at 649.
25
Id. See, BG Group PLC v. Republic of Argentina, ___ U.S. ___, 134 S. Ct.
1198, 188 L. Ed. 2d 220 (2014); Oxford Health Plans LLC v. Sutter, ___
U.S. ___, 133 S. Ct. 2064, 186 L. Ed. 2d 113 (2013); Howsam v. Dean
Witter Reynolds, Inc., 537 U.S. 79, 123 S. Ct. 588, 154 L. Ed. 2d 491
(2002); First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 115 S. Ct.
1920, 131 L. Ed. 2d 985 (1995).
- 224 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
type of controversy.26 Disputes over “formation of the par-
ties’ arbitration agreement” and “its enforceability or appli-
cability to the dispute” at issue are “matters . . . ‘the court’
must resolve.”27
[19,20] Conversely, parties can agree to arbitrate gateway
questions of arbitrability, such as whether the parties have
agreed to arbitrate or whether their agreement covers a particu-
lar controversy, if they do so with “clear and unmistakable”
intent.28 A contractual provision that delegates to the arbitra-
tor all questions regarding the scope or enforceability of an
arbitration provision is referred to as a “delegation clause.”29
A valid delegation clause requires the court to refer a claim
to arbitration to the arbitrator to decide gateway arbitrabil-
ity issues.30
[21,22] Enforcement of an arbitration agreement involves
two analytical steps: The first is contract formation—whether
the parties entered into any arbitration agreement at all. The
second involves contract interpretation to determine whether
this claim is covered by the arbitration agreement.31 Thus, if
the party seeking arbitration points to a purported delegation
clause, the court’s analysis is limited. It performs the first
step—an analysis of whether there is an agreement to arbitrate
any set of claims—as it always does.32 But the only question,
after finding that there is in fact a valid agreement, is whether
the purported delegation clause is in fact a delegation clause—
that is, if it evinces an intent to have the arbitrator decide
26
BG Group PLC, supra note 25.
27
Granite Rock Co. v. Teamsters, 561 U.S. 287, 299-300, 130 S. Ct. 2847,
177 L. Ed. 2d 567 (2010).
28
Rent-A-Center, West, Inc. v. Jackson, 561 U.S. 63, 69 n.1, 130 S. Ct. 2772,
177 L. Ed. 2d 403 (2010).
29
See, id.; Citizens of Humanity, supra note 2.
30
See id.
31
Kubala v. Supreme Production Services, Inc., 830 F.3d 199 (5th Cir. 2016).
32
Id.
- 225 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
whether a given claim must be arbitrated.33 A delegation clause
is an agreement to arbitrate a threshold issue and is simply
an additional, severable, antecedent arbitration agreement the
party seeking arbitration asks the court to enforce, and the FAA
operates on this additional arbitration agreement just as it does
on any other.34
In the instant matter, we note the plain language of the ADR
Agreement does not clearly and unmistakably empower an
arbitrator to determine enforceability issues such as the chal-
lenge Thomas raises here. In addition, GLCV did not argue to
the trial court, nor does it argue to this court, that the parties
agreed to allow an arbitrator to decide issues of arbitrability.
Further, Thomas specifically challenged the validity of the
agreement to arbitrate based upon fraud. Accordingly, if the
claim is fraud in the inducement or fraud in the execution of
the arbitration clause itself—an issue which goes to the mak-
ing of the agreement to arbitrate—the court may proceed to
adjudicate it.35
Thus, Thomas’ enforceability challenge to the ADR
Agreement is a matter for judicial determination.
(c) Motion to Compel
Arbitration Proceedings
The parties put forth different understandings about the
procedure the trial court followed when it ruled on GLCV’s
motion to compel arbitration. Thomas claims the court denied
arbitration using a motion for summary judgment standard
of viewing the evidence in the light most favorable to the
33
Id.
34
Citizens of Humanity, supra note 2.
35
Prima Paint v. Flood & Conklin, 388 U.S. 395, 87 S. Ct. 1801, 18 L. Ed.
2d 1270 (1967). See, also, Burden v. Check Into Cash of Kentucky, LLC,
267 F.3d 483 (6th Cir. 2001); Ferro Corp. v. Garrison Industries, Inc., 142
F.3d 926 (6th Cir. 1998); R.M. Perez & Associates, Inc. v. Welch, 960 F.2d
534 (5th Cir. 1992); Matterhorn, Inc. v. NCR Corp., 763 F.2d 866 (7th Cir.
1985).
- 226 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
nonmoving party. Thomas further claims he is entitled to a jury
trial on the issue of the formation of the ADR Agreement. To
support his contentions, Thomas relies on 9 U.S.C. § 4.36
GLCV contends that neither of Thomas’ claims is correct.
First, it contends that the district court’s order did not reference
the motion for summary judgment standard. Second, it con-
tends that since the court summarily denied the application to
compel arbitration, the issue is fully decided and no jury trial
would be warranted.
[23,24] Arbitration in Nebraska is governed by the UAA as
enacted in Nebraska, but if arbitration arises from a contract
involving interstate commerce, it is governed by the FAA.37
Where a transaction falls within the scope of the FAA, the
substantive issue of whether the motion to compel arbitration
should be granted is a question of federal law.38 However,
the U.S. Supreme Court has never held that § 4 of the FAA,
which is a procedural section, applies to state courts.39 There
is no federal policy favoring arbitration under a certain set of
procedural rules, and the federal policy is simply to ensure the
enforceability of private agreements to arbitrate.40
[25] Section 4 of the FAA authorizes an aggrieved party to
seek an order directing arbitration to proceed in the manner
provided for in the parties’ agreement.41 The court shall hear
36
See, BOSC, Inc. v. Bd. of Cnty. Com’rs Bernalillo Cnty, 853 F.3d 1165
(10th Cir. 2017); Nebraska Machinery Co. v. Cargotec Solutions, LLC,
762 F.3d 737 (8th Cir. 2014); Howard v. Ferrellgas Partners, L.P., 748
F.3d 975 (10th Cir. 2014); John M. Gradwohl, Arbitration: Interface of the
Federal Arbitration Act and Nebraska State Law, 43 Creighton L. Rev. 97
(2009).
37
Aramark Uniform & Career Apparel, supra note 20.
38
Webb, supra note 6.
39
Vaden v. Discover Bank, 556 U.S. 49, 129 S. Ct. 1262, 173 L. Ed. 2d 206
(2009); Volt Info. Sciences v. Leland Stanford Jr. U., 489 U.S. 468, 109 S.
Ct. 1248, 103 L. Ed. 2d 488 (1989); Kremer, supra note 15.
40
Kremer, supra note 15.
41
9 U.S.C. § 4.
- 227 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
the parties, and upon being satisfied that the making of the
agreement for arbitration or the failure to comply therewith is
not in issue, the court shall make an order directing the parties
to proceed to arbitration in accordance with the terms of the
agreement.42 If the making of the arbitration agreement or the
failure, neglect, or refusal to perform the same be in issue, the
court shall proceed summarily to the trial thereof, if no jury
trial be demanded by the party alleged to be in default.43
[26] Under § 25-2603(a) of the UAA, on application of a
party showing a valid arbitration agreement and the opposing
party’s refusal to arbitrate, the court shall order the parties to
proceed with arbitration, but if the opposing party denies the
existence of the agreement to arbitrate, the court shall proceed
summarily to the determination of the issue so raised and shall
order for the moving party; otherwise, the application shall
be denied.
[27] Section 25-2603 does not defeat the FAA’s objective,
expressed in § 4, that if the making of the arbitration agree-
ment or the failure, neglect, or refusal to perform the same be
in issue, the court shall proceed summarily to the trial thereon.
Further, nothing in our record indicates that Thomas requested
a jury trial on the enforceability of the ADR Agreement,
and as a result, the trial court summarily tried the issue of
arbitrability.
[28] On appeal, Thomas did not object to the procedure
followed by the district court, and he did not cross-appeal
or assign error to the fact that the district court did not order
a jury trial on the issue. Because an appellate court will not
consider an issue on appeal that was not passed upon by the
trial court,44 we do not address Thomas’ contention that he is
entitled to a jury trial on the issue of enforceability.
42
Id.
43
Id.
44
Thorson v. Nebraska Dept. of Health & Human Servs., 274 Neb. 322, 740
N.W.2d 27 (2007).
- 228 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
(d) Enforceability of
ADR Agreement
[29] The FAA makes arbitration agreements “‘valid, irrevo-
cable, and enforceable, save upon such grounds as exist at law
or in equity for the revocation of any contract.’”45 Under § 2
of the FAA, arbitration agreements can be declared unenforce-
able “‘upon such grounds as exist at law or in equity for the
revocation of any contract,’”46 including contract defenses like
fraud or unconscionability.47 State law governs the formation of
contracts, as well as the validity, revocability, and enforceability
of contracts generally.48 The U.S. Supreme Court has declared
that state contract law applies to contracts with arbitration agree-
ments governed by the FAA.49
In this matter, neither party disputed that Eugene signed the
ADR Agreement and that he had authority to bind Helen and
her estate under the durable power of attorney. Instead, Thomas
argues that the ADR Agreement was not enforceable, because
it was obtained by fraud.
In overruling GLCV’s motion to compel arbitration, the
court did not explicitly state that Eugene signed the ADR
Agreement as a consequence of a fraudulent misrepresenta-
tion made by GLCV’s agent. However, a logical reading of
the court’s order is that it implicitly determined that the ADR
Agreement is void or should be voided due to fraud.
GLCV claims that if the court denied the motion on a fraud
theory advanced by Thomas, a proper fraud analysis would
45
Kindred Nursing Centers L.P. v. Clark, ___ U.S. ___, 137 S. Ct. 1421,
1426, 197 L. Ed. 2d 806 (2017) (quoting 9 U.S.C. § 2).
46
AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339, 131 S. Ct. 1740, 179
L. Ed. 2d 742 (2011).
47
Id. See, also, Prima Paint, supra note 35.
48
Doctor’s Associates, Inc. v. Casarotto, 517 U.S. 681, 116 S. Ct. 1652, 134
L. Ed. 2d 902 (1996); First Options of Chicago, Inc. v. Kaplan, 514 U.S.
938, 115 S. Ct. 1920, 131 L. Ed. 2d 985 (1995). See Koricic v. Beverly
Enters. - Neb., 278 Neb. 713, 773 N.W.2d 145 (2009).
49
Aramark Uniform & Career Apparel, supra note 20.
- 229 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
have analyzed the six elements of fraud.50 Accordingly, GLCV
argues that no representation was made, any representation
made was not false, any false representation made was not
known to be false, and there was no fraudulent intent, nor
was there any reasonable reliance. GLCV asserts there was
no fraud in the execution, nor was there any fraud in the
inducement.
[30] Generally, in the absence of fraud, one who signs an
instrument without reading it, when one can read and has had
the opportunity to do so, cannot avoid the effect of one’s sig-
nature merely because one was not informed of the contents
of the instrument.51
“[C]ourts will not permit a party to avoid a contract into
which that party has entered on the grounds that he or she
did not attend to its terms, that he or she did not read the
document which was signed and supposed it was differ-
ent from its terms, or that it was a mere form.”52
To permit a party to admit that he or she signed an instrument
but did not read it or know its provisions would absolutely
destroy the value of contracts.53
[31] However, the rule that one who fails to read a con-
tract cannot avoid the effect of signing it applies only in the
50
See deNourie & Yost Homes v. Frost, 289 Neb. 136, 854 N.W.2d 298
(2014).
51
In re Claims Against Pierce Elevator, 291 Neb. 798, 868 N.W.2d 781
(2015); Eicher v. Mid America Fin. Invest. Corp., 270 Neb. 370, 702
N.W.2d 792 (2005); Ray Tucker & Sons v. GTE Directories Sales Corp.,
253 Neb. 458, 571 N.W.2d 64 (1997); Todd Brothers v. Federal Crop Ins.
Corp., 178 Neb. 211, 132 N.W.2d 778 (1965); Case Co. v. Hrubesky, 125
Neb. 588, 251 N.W. 169 (1933).
52
In re Claims Against Pierce Elevator, supra note 51, 291 Neb. at 826, 868
N.W.2d at 802 (quoting In re Claims Against Atlanta Elev., Inc., 268 Neb.
598, 685 N.W.2d 477 (2004) (superseded by statute as stated in Telrite
Corp. v. Nebraska Pub. Serv. Comm., 288 Neb. 866, 852 N.W.2d 910
(2014)).
53
Todd Brothers, supra note 51.
- 230 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
absence of fraud54 or an inability to read.55 The doctrine that
the carelessness or negligence of a party in signing a writing
estops him or her from afterward disputing the contents of
such writing is not applicable in a suit thereon between the
original parties thereto when the defense is that such writ-
ing, by reason of fraud, does not embrace the contract actu-
ally made.56
[32,33] A variety of different types of fraud may be at issue
in a given case. We have emphasized, for example, that “fraud
in the execution” and “fraud in the inducement” are distinct
theories of fraud.
Fraud in the execution goes to the very existence of the
contract, such as where a [contract] is misread to the
[party], or where one paper is surreptitiously substituted
for another, or where a party is tricked into signing an
instrument he or she did not mean to execute. In such
cases, . . . there was no meeting of the minds, . . . in
other words, it is not a question of a contract voidable for
fraud, but of no contract at all. Fraud in the inducement,
by contrast, goes to the means used to induce a party to
enter into a contract. In such cases, the party knows the
character of the instrument and intends to execute it, but
the contract may be voidable if the party’s consent was
obtained by false representations—for instance, as to
the nature and value of the consideration, or other mate-
rial matters.57
54
Walters v. Sporer, 298 Neb. 536, 905 N.W.2d 70 (2017); Eicher, supra
note 7; Todd Brothers, supra note 51.
55
Gonzalez v. Union Pacific RR. Co., 282 Neb. 47, 803 N.W.2d 424 (2011);
NJI2d Civ. 15.21.
56
Eicher, supra note 7; Lippire v. Eckel, 178 Neb. 643, 134 N.W.2d 802
(1965); West v. Wegner, 172 Neb. 692, 111 N.W.2d 449 (1961); Ward v.
Spelts, 39 Neb. 809, 58 N.W. 426 (1894).
57
Gonzalez, supra note 55, 282 Neb. at 66, 803 N.W.2d at 442. Accord
Heritage Bank v. Bruha, 283 Neb. 263, 812 N.W.2d 260 (2012).
- 231 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
[34] In this matter, Thomas contends that Eugene was
induced into executing the ADR Agreement by GLCV’s
fraudulent misrepresentation. A fraudulent misrepresentation
claim requires a plaintiff to establish the following elements:
(1) A representation was made; (2) the representation was
false; (3) when made, the representation was known to be
false or made recklessly without knowledge of its truth and
as a positive assertion; (4) the representation was made with
the intention that the plaintiff should rely on it; (5) the plain-
tiff did so rely on it; and (6) the plaintiff suffered damage as
a result.58
[35-37] Fraudulent misrepresentations may consist of half-
truths calculated to deceive, and a representation literally true
is fraudulent if used to create an impression substantially
false.59 A plaintiff must show that the defendant intended the
plaintiff to rely on a false representation.60 Whether a party’s
reliance upon a misrepresentation was reasonable is a ques-
tion of fact.61 A party is justified in relying upon a representa-
tion made to the party as a positive statement of fact when
an investigation would be required to ascertain its falsity.62
A plaintiff fails to exercise ordinary prudence only when the
plaintiff’s reliance is wholly unreasonable, given the facts
open to the plaintiff’s observation and his or her own skill
and experience.63
58
deNourie & Yost Homes, supra note 50; Zawaideh v. Nebraska Dept. of
Health & Human Servs., 285 Neb. 48, 825 N.W.2d 204 (2013); Cao v.
Nguyen, 258 Neb. 1027, 607 N.W.2d 528 (2000). See Hayes v. Equine
Equities, 239 Neb. 964, 480 N.W.2d 178 (1992).
59
Knights of Columbus Council 3152 v. KFS BD, Inc., 280 Neb. 904, 791
N.W.2d 317 (2010).
60
Id.
61
InterCall, Inc. v. Egenera, Inc., 284 Neb. 801, 824 N.W.2d 12 (2012);
Cao, supra note 58.
62
InterCall, Inc., supra note 61; Schuelke v. Wilson, 250 Neb. 334, 549
N.W.2d 176 (1996); Hayes, supra note 58.
63
deNourie & Yost Homes, supra note 50.
- 232 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
[38] In a fraud case, direct evidence is not essential, but
proof of fraud drawn from circumstantial evidence must not be
guesswork or conjecture; such proof must be rational and logi-
cal deductions from the facts and circumstances from which
they are inferred.64
We now turn to whether the district court’s decision to deny
GLCV’s motion was clearly wrong.
[39,40] Under Neb. Rev. Stat. § 25-1127 (Reissue 2016),
in the absence of a request by a party for specific findings,
a trial court is not required to make detailed findings of
fact and need only make its findings generally for the pre-
vailing party.65 In a case tried to the court without a jury, a
motion for specific findings of fact pursuant to § 25-1127
must be made before the final submission of the case to the
court.66 Where trial is to the court and no request for spe-
cific findings is made, if there is a conflict in the evidence,
this court, in reviewing the judgment rendered, will presume
that controverted facts were decided by the trial court in
favor of the successful party and the findings will not be dis-
turbed unless clearly wrong.67 In such a case, it is not within
the province of this court to resolve conflicts or to weigh
evidence.68
In the instant matter, the record does not reflect that either
party made a request for detailed findings. The trial court,
however, did address the issue raised by GLCV’s motion and
made findings generally in Thomas’ favor.
64
Four R Cattle Co. v. Mullins, 253 Neb. 133, 570 N.W.2d 813 (1997);
Schuelke, supra note 62.
65
See Lange Indus. v. Hallam Grain Co., 244 Neb. 465, 507 N.W.2d 465
(1993).
66
Stuczynski v. Stuczynski, 238 Neb. 368, 471 N.W.2d 122 (1991).
67
Burgess v. Curly Olney’s, Inc., 198 Neb. 153, 251 N.W.2d 888 (1977); C.
Goodrich, Inc. v. Thies, 14 Neb. Ct. App. 170, 705 N.W.2d 451 (2005).
68
Bailey v. Karnopp, 170 Neb. 836, 104 N.W.2d 417 (1960).
- 233 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
We note that the evidence before the district court consisted
of affidavits from Weberg, Eugene, and Thomas, as well the
ADR Agreement and Helen’s durable power of attorney.
[41] We recently set forth that “under Neb. Rev. Stat.
§ 25-1244 (Reissue 2016), an affidavit is admissible in
certain enumerated situations, including ‘motion practice,’
which includes the use of affidavits relating to prelimi-
nary, collateral, and interlocutory matters.”69 The Nebraska
Legislature has authorized the use of affidavits to support
a wide range of common civil motions.70 Congress has pro-
vided that unless otherwise expressly provided, any applica-
tion to the court brought under the FAA shall be made and
heard in the manner provided by law for the making and
hearing of motions.71 The policy underlying § 6 of the FAA
“is to expedite by ordinary motion practice judicial treatment
of matters pertaining to arbitration.”72 For example, over 40
years ago in Prima Paint v. Flood & Conklin,73 in reviewing
a claim of fraud in the inducement of an arbitration contract,
the U.S. Supreme Court considered affidavit evidence to
decide the issue of whether the contract was a transaction in
interstate commerce.
[42] Although we are less deferential to a trial court’s find-
ings given that the case was presented wholly on documents
and affidavit statements rather than through live witnesses,
that does not alter our standard of review in this case.74 Rather,
GLCV’s burden of proving that the district court’s findings
69
TransCanada Keystone Pipeline v. Nicholas Family, 299 Neb. 276, 283,
908 N.W.2d 60, 66 (2018).
70
See Neb. Rev. Stat. §§ 25-1144, 25-1330 to 25-1336, 25-2160, and
25-2301.01 (Reissue 2016 & Supp. 2017).
71
9 U.S.C. § 6.
72
Tepper Realty Company v. Mosaic Tile Company, 259 F. Supp. 688, 693
(S.D.N.Y. 1966).
73
Prima Paint, supra note 35.
74
See Matter of Bohart, 743 F.2d 313 (5th Cir. 1984).
- 234 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
were clearly wrong is “‘“‘to some extent ameliorated.’”’”75
Even though an appellate court is, in the absence of oral testi-
mony, equally capable as the trial court of examining the evi-
dence and drawing conclusions therefrom and is under a duty to
do so, and even though a case was submitted to the trial court
without oral evidence, the duty of the appellate court to evalu-
ate the facts does not extend to the right or duty to make an
independent evaluation thereof without regard to the findings
below. In such a case, an appellate court is loath to overturn the
findings of an experienced trial judge unless in the opinion of
the court they are clearly wrong.76
[43] Thomas adduced evidence that an agent of GLCV made
a representation to Eugene that he was required to sign the
ADR Agreement in order for Helen to become a resident of
the facility. Though Weberg’s affidavit stated her belief that
this representation was not made, she was not present when
the ADR Agreement was signed, and the trial court appears to
have given little or no weight to her submission. Further, state-
ments in affidavits as to opinion, belief, or conclusions of law
are of no effect.77
If the representation was made, the evidence indicates
that the representation was false. The language of the ADR
Agreement states that execution of the ADR Agreement was
not a condition for admission.
There is also evidence that the representation was known
to be false when it was made, or was made recklessly. The
disclaimer at the top of the first page of the ADR Agreement,
written in bold and capitalized letters, suggests that anyone
who had an opportunity to read and sign the agreement,
including a GLCV staff member, would have known that it
was optional.
75
Id. at 325 n.12.
76
Commercial Standard Ins. Co. v. Universal Underwriters, 282 F.2d 24
(10th Cir. 1960).
77
See Boyle v. Welsh, 256 Neb. 118, 589 N.W.2d 118 (1999).
- 235 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
There is also evidence that the false representation was
made with the intention that Thomas should rely upon it. Both
Eugene and Thomas claimed they were not given an oppor-
tunity to review the contract. Eugene stated the staff member
handled the paperwork, flipped through the pages, and told
him to sign “‘here.’” Thomas stated the staff member showed
Eugene only the bottom half of the pages. This conclusion is
supported by the ADR Agreement itself, because everything
other than Eugene’s signature appears to have been filled out
in advance.
The evidence also indicates that Eugene reasonably relied
upon the false representation. Both Eugene and Thomas
stated that the staff member claimed these were “‘standard
forms,’” that she did not provide them with a copy of the
ADR Agreement, that she did not explain its legal effect, and
that she did not state that it was not required in order to admit
Eugene and Helen. Additionally, Eugene stated that he would
not have signed the ADR Agreement if he had known it was
not mandatory.
Lastly, the evidence shows that Helen suffered damage as a
result of the false representation. If GLCV’s motion to compel
arbitration would be sustained, Thomas, on behalf of Helen’s
estate, would lose the right to bring suit for her alleged wrong-
ful death.
Recognizing that direct evidence is not required in fraud
cases, and viewing the evidence in the light most favorable
to Thomas, we find Thomas satisfied each element required
for a claim of fraudulent representation and the determination
that the ADR Agreement is not binding upon Helen. We con-
clude from our review that the evidence supports the outcome
reached by the district court.
V. CONCLUSION
In the absence of a contractual provision evidencing clear
and unmistakable intent to the contrary, the issue of whether
- 236 -
Nebraska Supreme Court A dvance Sheets
300 Nebraska R eports
CULLINANE v. BEVERLY ENTERS. - NEB.
Cite as 300 Neb. 210
an arbitration agreement is enforceable is for a court to decide
and not an arbitrator. The district court did not err in determin-
ing that the ADR Agreement was not binding upon Helen or
her estate. We therefore affirm the district court’s decision.
A ffirmed.
Wright and K elch, JJ., not participating.