Gollick, J. v. Sycamore Creek Healthcare ( 2021 )

J-A14031-21
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
JAMES GOLLICK AS ADMINISTRATOR : IN THE SUPERIOR COURT OF
OF THE ESTATE OF ANNA MAY : PENNSYLVANIA
GOLLICK :
:
:
v. :
:
:
SYCAMORE CREEK HEALTHCARE : No. 1068 WDA 2020
GROUP, INC. D/B/A CARING :
HEIGHTS COMMUNITY CARE AND :
REHABILITATION CENTER, SABER :
HEALTHCARE GROUP, LLC AND :
ROSEWOOD OF THE OHIO VALLEY, :
LLC :
:
:
APPEAL OF: SYCAMORE CREEK :
HEALTHCARE GROUP, INC. D/B/A :
CARING HEIGHTS COMMUNITY CARE :
AND REHABILITATION CENTER AND :
SABER HEALTHCARE GROUP, LLC :
Appeal from the Order Entered September 8, 2020
In the Court of Common Pleas of Allegheny County
Civil Division at No: GD-20-006372
BEFORE: NICHOLS, J., MURRAY, J., and KING, J.
MEMORANDUM BY MURRAY, J.: FILED: JULY 29, 2021
Sycamore Creek Healthcare Group, Inc., d/b/a Caring Heights
Community Care and Rehabilitation Center, and Saber Healthcare Group, LLC
(collectively, Appellants), appeal from the order denying Appellants’
preliminary objections (POs) requesting transfer of the survival claim of
Appellee, James Gollick (Gollick), to binding arbitration pursuant to an
arbitration agreement between Appellants and Gollick’s late mother, Anna May
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Gollick (Decedent). Upon careful review of precedent and the record, we
reverse and remand for referral to arbitration.
This appeal arises from Gollick’s wrongful death and survival action,1
asserting that Appellants and Rosewood of the Ohio Valley, LLC (Rosewood)2
were negligent in their care of Decedent, who was a patient at their respective
nursing home facilities in October and November 2018. In sum, Gollick claims
the negligence of Appellants and Rosewood resulted in Decedent suffering a
urinary tract infection, sepsis, and eventual death on November 27, 2018.
Pertinently, upon Decedent’s admission to Appellants’ facility, her
husband and power-of-attorney (POA), Frank Gollick (Frank), signed the
arbitration agreement (Arbitration Agreement) on Decedent’s behalf, which
required that any disputes be resolved in arbitration. See generally
Arbitration Agreement, 11/2/18 (attached to Appellants’ July 8, 2020 POs as
Exhibit C).
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1 “Pennsylvania’s Wrongful Death Act, 42 Pa.C.S.A. § 8301, allows a spouse,
children or parents of a deceased to sue another for a wrongful or neglectful
act that led to the death of the deceased.” Dubose v. Quinlan, 125 A.3d
1231, 1238 (Pa. Super. 2015) (statutory citation modified; citation omitted).
Survival actions, under 42 Pa.C.S.A. § 8302, “permit a personal representative
to enforce a cause of action which has already accrued to the deceased before
his death.” Pastierik v. Duquesne Light Co., 526 A.2d 323, 326 (Pa. 1987)
(emphasis and citation omitted).
2 Rosewood advised this Court by correspondence dated February 10, 2021
that it “will not be taking any position with respect to the appeal” and “will not
be participating in this matter.”
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On June 3, 2020, Gollick, individually and as administrator of Decedent’s
estate, filed a complaint alleging professional negligence, corporate
negligence, survivorship and wrongful death.
Appellants filed POs on July 8, 2020, arguing the Arbitration Agreement
required Gollick’s survival claim to be resolved through arbitration. POs,
7/8/20, at ¶¶ 7, 11, 17. It is undisputed that Gollick’s wrongful death claim
is not subject to arbitration. See id. at ¶ 20 (asserting Gollick’s remaining
claims must be stayed pending resolution of the survival claim). Appellants
claimed Frank was authorized in his role as Decedent’s POA agent to execute
the Arbitration Agreement on Decedent’s behalf.3 Id. at ¶¶ 5-6, 9.
Gollick filed an answer in opposition to the POs disputing arbitration of
the survival claim. Answer, 9/1/20, at ¶ 7.
On September 8, 2020, the trial court entered an order denying
Appellants’ POs.4 Appellants timely appealed. Both the trial court and
Appellants have complied with Pa.R.A.P. 1925.
On appeal, Appellants present a single question:
____________________________________________
3 Appellants attached to their POs a copy of the durable POA agreement (POA
Agreement) dated November 11, 2016. The POA Agreement granted Frank
numerous powers, including, inter alia, the power to “commence, prosecute,
defend or settle claims and litigation” on behalf of Decedent. POA Agreement,
11/11/16, at ¶ 8 (attached to Appellants’ POs as Exhibit B).
4 The trial court utilized a proposed order submitted by Appellants which
detailed the relief sought in their POs. The court crossed out Appellants’
proposed language and handwrote “Denied.”
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Whether the Trial Court erred in refusing to enforce a valid
Arbitration Agreement between Defendants/Appellants and
[Decedent] on grounds that the survival claim cannot be
bifurcated from the wrongful death claim?
Appellants’ Brief at 2.
Preliminarily, we recognize:
This Court reviews an order sustaining or overruling preliminary
objections for an error of law, and in so doing, must apply the
same standard as the trial court.
Preliminary objections in the nature of a demurrer test the legal
sufficiency of the complaint. When considering preliminary
objections, all material facts set forth in the challenged pleadings
are admitted as true, as well as all inferences reasonably
deducible therefrom. Preliminary objections which seek the
dismissal of a cause of action should be sustained only in cases in
which it is clear and free from doubt that the pleader will be unable
to prove facts legally sufficient to establish the right to relief. If
any doubt exists as to whether a demurrer should be sustained, it
should be resolved in favor of overruling the preliminary
objections.
Sayers v. Heritage Valley Med. Grp., Inc., 247 A.3d 1155, 1160-61 (Pa.
Super. 2021) (citations omitted).
Gollick maintains the trial court’s ruling is correct. He argues:
Nothing in the record of this matter indicates [Decedent] had any
intent to enter into an arbitration agreement with []Appellants.
She did not review and sign the [Arbitration A]greement and she
did not grant [Frank] or anyone else the authority to waive her
right to pursue valid legal claims through a court of law.
Gollick’s Brief at 9-10 (citing Petersen v. Kindred Healthcare, Inc., 155
A.3d 641, 645 (Pa. Super. 2017) (for arbitration agreement between nursing
home and patient’s POA agent to be valid, there must be an agency
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relationship between patient/principal and the purported POA agent)).5
Gollick claims that although the POA Agreement “grants [Frank] the ability to
pursue litigation on [Decedent’s] behalf, nothing in the Power of Attorney
grants [Frank] the authority to waive [Decedent’s] right to access the court
system and have the matter decided by a jury in favor of arbitration.” Brief
in Opposition to POs, 9/1/20, at 4 (unnumbered). Gollick emphasizes that
next to Frank’s signature on the form Arbitration Agreement, a typewritten
“x” was entered in a box indicating that Frank was Decedent’s “Husband.”
Gollick’s Brief at 4; see also Arbitration Agreement, 11/2/18, at p. 4
(unnumbered). We are not persuaded by Gollick’s argument.
With regard to agency, this Court has explained:
A party can be compelled to arbitrate under an agreement,
even if he or she did not sign that agreement, if common-law
principles of agency and contract support such an obligation on
his or her part. … An agency relationship may be created by any
of the following: (1) express authority, (2) implied authority,
(3) apparent authority, and/or (4) authority by estoppel. Agency
cannot be inferred from mere relationships or family ties, and we
do not assume agency merely because one person acts on behalf
of another. Rather, we look to facts to determine whether the
principal expressly or impliedly intended to create an agency
relationship. … Finally, the party asserting the agency
relationship bears the burden of proving it by a preponderance of
the evidence.
Express authority exists where the principal deliberately and
specifically grants authority to the agent as to certain matters. …
____________________________________________
5 Gollick raised this claim before the trial court.See Brief in Opposition to
POs, 9/1/20, at 3-4 (unnumbered); see also Bollard & Assocs. v. H&R
Indus., 161 A.3d 254, 256 (Pa. Super. 2017) (noting claims must first be
raised before the trial court to be preserved on appeal).
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A valid, durable power of attorney constitutes a grant of
express authority per its terms. See 20 Pa.C.S.A. § 5601(a).
Wisler v. Manor Care of Lancaster PA, LLC, 124 A.3d 317, 323-24 (Pa.
Super. 2015) (emphasis added; quotation marks, brackets and some citations
omitted).
Here, the POA Agreement gave Frank the authority to “commence,
prosecute, defend or settle claims and litigation” on behalf of Decedent. POA
Agreement, 11/11/16, at ¶ 8. Pursuant to statute, a POA agent’s power to
pursue claims and litigation includes the power to arbitrate. See 20 Pa.C.S.A.
§ 5603(s)(1) (“A power to ‘pursue claims and litigation’ shall mean that the
agent may . . . [i]nstitute, prosecute, defend, abandon, arbitrate,
compromise, settle or otherwise dispose of . . . any legal proceedings . . .
regarding any claim relating to the principal[.]” (emphasis added)).
Further, there is nothing in the record to indicate the POA Agreement
was invalid.6 Frank thus had express authority to act on Decedent’s behalf
under the POA Agreement, including the authority to agree to arbitrate legal
claims. See Wisler, supra. Contrary to Gollick’s argument, our
determination in this regard is not altered by the “x” notation in the Arbitration
Agreement indicating Frank was Decedent’s “Husband.” Indeed, the trial court
found that Frank signed the Arbitration Agreement “as Power of Attorney
____________________________________________
6 Gollick never alleged that Decedent was suffering from dementia, mental
infirmity, or disorientation when the POA Agreement was executed.
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for the [D]ecedent,” Trial Court Opinion, 11/23/20, at 7 (emphasis added),
and Appellants presented the POA Agreement to the trial court as proof of the
agency relationship, consistent with Wisler.
Finally, the law upon which Gollick relies is distinguishable. See id.,124 A.3d at 325, 327 (trial court properly refused to submit to arbitration the
survival claim of deceased’s son/plaintiff (and purported POA agent), who had
signed the arbitration agreement on the deceased’s behalf upon admission to
the nursing home, where the POA agreement was never produced and the
trial court found no agency relationship). Conversely, Appellants produced
the POA Agreement, and Frank acted as POA in signing the Arbitration
Agreement. See Trial Court Opinion, 11/23/20, at 7 (stating Frank signed the
Arbitration Agreement as Decedent’s POA); cf. Wisler, 124 A.3d at 320-21.
We next address the propriety of the trial court’s ruling.
In an appeal from an order overruling preliminary objections seeking to
compel arbitration, our review “is limited to determining whether the trial
court’s findings are supported by substantial evidence and whether the trial
court abused its discretion in denying the petition.” Pisano v. Extendicare
Homes, Inc., 77 A.3d 651, 654 (Pa. Super. 2013) (quotation marks omitted).
We “employ a two-part test to determine whether the trial court should have
compelled arbitration: (1) whether a valid agreement to arbitrate exists, and
(2) whether the dispute is within the scope of the agreement.” Davis v. Ctr.
Mgmt. Grp., LLC, 192 A.3d 173, 180 (Pa. Super. 2018) (citation and brackets
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omitted). “When addressing the issue of whether there is a valid agreement
to arbitrate, courts generally should apply ordinary state-law principles that
govern the formation of contracts, but in doing so, must give due regard to
the federal policy favoring arbitration.” Cardinal v. Kindred Healthcare,
Inc., 155 A.3d 46, 53 (Pa. Super. 2017) (citation omitted).
We have explained:
Pennsylvania has a well-established public policy that favors
arbitration, and this policy aligns with the federal approach
expressed in the Federal Arbitration Act (“FAA”)[, 9 U.S.C.S. §§
1–16]. The fundamental purpose of the Federal Arbitration Act is
to relieve the parties from expensive litigation and to help ease
the current congestion of court calendars. Its passage was a
congressional declaration of a liberal federal policy favoring
arbitration agreements.
Pisano, 77 A.3d at 660 (internal citations, brackets and quotations omitted).
However, we cautioned that “the existence of an arbitration provision and a
liberal policy favoring arbitration does not require the rubber stamping of all
disputes as subject to arbitration.” Id. at 661 (citation omitted).
Finally, state laws that prohibit arbitration of particular types of claims
conflict with and are preempted by the FAA, and are thus invalid under
the Supremacy Clause of the United States Constitution. In re Estate of
Atkinson, 231 A.3d 891, 900 (Pa. Super. 2020) (citing Marmet Health Care
Center, Inc. v. Brown, 565 U.S. 530, 532-33 (2012)).
In the instant case, the trial court correctly explained the holding in
Pisano, i.e., that Pennsylvania’s wrongful death statute creates an
independent action, distinct from a survival claim, which is not derivative of
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the rights of the decedent, and therefore, a decedent’s “contractual agreement
with [a nursing home] to arbitrate all claims [is] not binding on the non-
signatory wrongful death claimants.” Pisano, 77 A.3d at 663; see also Trial
Court Opinion, 11/23/20, at 8-9.
Yet subsequently, in the landmark decision Taylor v. Extendicare
Health Facilities, Inc., 147 A.3d 490 (Pa. 2016), the Pennsylvania Supreme
Court held that where there is a valid arbitration agreement between a
decedent and a nursing home, survival claims must proceed to arbitration
despite the existence of an accompanying wrongful death claim. See id. at
507-11. The Supreme Court found the trial court erred in denying
defendant/nursing home’s motion to compel arbitration of plaintiff’s survival
claim where a valid arbitration agreement existed. Id. at 509-10 (holding
FAA preempted trial court’s application of Pa.R.C.P. 213(e), which requires the
consolidation of survival and wrongful death actions for trial). The Supreme
Court stated:
[T]he prospect of inefficient, piecemeal litigation proceeding in
separate forums is no impediment to the arbitration of arbitrable
claims. Indeed, where a plaintiff has multiple disputes with
separate defendants arising from the same incident, and only one
of those claims is subject to an arbitration agreement, the [United
States Supreme] Court requires, as a matter of law,
adjudication in separate forums.
Id. at 507. The Court concluded:
[S]olicitous of our obligation to consider questions of arbitrability
with a “healthy regard for the federal policy favoring arbitration,”
Moses H. Cone [Mem’l Hosp. v. Mercury Constr. Corp.], 460
U.S. [1,] 20 [(1983)], we observe that Section 2 of the FAA binds
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state courts to compel arbitration of claims subject to an
arbitration agreement. 9 U.S.C. § 2 (providing that arbitration
agreements “shall be valid, irrevocable, and enforceable”). This
directive is mandatory, requiring parties to proceed to
arbitration on issues subject to a valid arbitration agreement,
even if a state law would otherwise exclude it from arbitration.
Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52,
58, 115 S. Ct. 1212, 131 L. Ed. 2d 76 (1995).
The only exception to a state’s obligation to enforce an
arbitration agreement is provided by the savings clause, which
permits the application of generally applicable state contract
law defenses such as fraud, duress, or unconscionability, to
determine whether a valid contract exists.
Taylor, 147 A.3d at 509 (emphasis added; some citations and footnote
omitted).
Here, the trial court briefly acknowledged Taylor’s holding, but declined
to submit Gollick’s survival claim to arbitration because: “Without a logical
argument as to intent by [D]ecedent, this court cannot simply view ‘the
existence of an arbitration provision, coupled with a liberal policy favoring
arbitration and rubber stamp all disputes as subject to arbitration.’” Trial
Court Opinion, 11/23/20, at 8-10 (quoting Pisano, 77 A.3d at 661 (citation
omitted)). The trial court did not elaborate further, and this single cursory
sentence is the only reasoning the trial court provides for finding the
Arbitration Agreement unenforceable.
Appellants challenge the trial court’s application of case law, arguing:
[C]onsistent with the FAA and the Pennsylvania Supreme Court’s
holding in Taylor, Pennsylvania law requires enforcement of
arbitration provisions as written, “permitting such provisions to be
set aside only for generally recognized contract defenses such as
duress, illegality, fraud, and unconscionability.” Gaffer Ins. Co.
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[v. Discover Reinsurance Co., Ltd.], 936 A.2d 1109, 1114 (Pa.
Super. 2007) [(citation omitted); see also Taylor, supra]. The
trial court here made no findings whatsoever concerning
such accepted defenses as lack of authority, lack of capacity,
fraud or duress. Instead, it simply chose to ignore settled law in
refusing to submit the survival claim to arbitration.
***
Although the trial court did acknowledge the Supreme
Court’s decision in Taylor as holding that survival claims and
wrongful death claims must be bifurcated, in reality[, the trial
court] simply chose not to follow Taylor at all. [The court] did so
on the dubious basis about a “lack of evidence” regarding the
[D]ecedent’s intent. This position directly contradicts Taylor.
Appellants’ Brief at 13-14 (emphasis added; some capitalization omitted).
Appellants contend the trial court essentially, and incorrectly, ruled “when an
Agreement provides ‘all disputes’ should be submitted to arbitration, and
wrongful death claims, by operation of Pennsylvania law, cannot be arbitrated,
the entire Agreement is void.” Id. at 14-15.
We are persuaded by Appellants’ argument and conclude the trial court
abused its discretion in refusing to enforce the Arbitration Agreement and
permit Gollick’s survival claim to proceed to arbitration. The Pennsylvania
Supreme Court in Taylor unequivocally held: “The only exception to a state’s
obligation to enforce an arbitration agreement” is when a state contract law
defense (such as unconscionability) is pled and proven. Taylor, 147 A.3d at
509. In this case, the trial court never made a finding that any state
contract defense existed, nor did Gollick plead any such defense.
Thus, pursuant to Taylor and its progeny, the trial court should have
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submitted Gollick’s survival claim to binding arbitration. See id.; see also
Cardinal, 155 A.3d at 54-55 (applying Taylor and finding trial court error for
failure to submit survival claim to arbitration pursuant to an enforceable
agreement to arbitrate between nursing home and decedent).
Our independent review reveals the Arbitration Agreement was
enforceable. The Agreement provides:
RESIDENT AND FACILITY ARBITRATION AGREEMENT
(NOT A CONDITION OF ADMISSION – READ CAREFULLY)
 Disputes to be Arbitrated.
Any and all disputes, legal controversies, disagreements or claims
of any kind now existing or occurring in the future between the
Resident and the Facility, arising out of or in any way relating to
this Agreement or the Resident’s stay, shall be settled by binding
arbitration, including, but not limited to claims for negligence,
medical malpractice, wrongful death, tort, breach of statutory
duty, breach of contract, resident rights, any joint or consolidated
claims, and any departures from standard care. This includes
claims against the Facility, its employees, agents, officers,
directors, any parent, subsidiary or affiliate of the facility.
***
 Right to Cancel Agreement.
The Resident and the Resident’s legal representative has
the right to cancel this Agreement by notifying the Facility
in writing. Such notice must be sent via certified mail to
the attention of the Administrator of the Facility, and the
notice must be post marked within sixty (60) days of the
date upon which this Agreement was signed.
• Resident Understanding & Acknowledgment Regarding
Arbitration.
By signing this Agreement, the Resident acknowledges that
he/she has been informed that:
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(1) This Agreement shall not limit in any way his/her right
to file formal or informal grievances with the Facility or the
State or Federal government, including the right to
challenge a proposed transfer or discharge;
(2) Signing this Agreement is not a condition of admission,
and that care and treatment will be provided to the
Resident whether or he/she signs this Agreement;
(3) The decision whether to sign the Agreement is
voluntary and solely a matter for the Resident’s
determination without any influences;
(4) All of the terms of the Agreement have been explained
to the Resident and the Resident [sic] and/or
Representative;
(5) The Resident has received a copy of this Agreement;
(6) The Resident has had an opportunity to ask questions
about this Agreement;
(7) The Resident has had an opportunity to read this
Agreement and propose edits or revised terms or alter the
Agreement;
(8) The Resident has the right to seek legal counsel
regarding this Agreement and has been advised to retain
legal counsel before signing this Agreement; and
(9) THE PARTIES UNDERSTAND THAT BY ENTERING INTO
THIS AGREEMENT, THE PARTIES ARE GIVING UP THEIR
CONSTITUTIONAL RIGHT TO HAVE ANY CLAIM DECIDED IN
A COURT OF LAW BEFORE A JUDGE AND A JURY, AS WELL
AS ANY APPEAL FROM A DECISION OR AWARD OF
DAMAGES.
Arbitration Agreement, 11/2/18, at 1, 3-4 (unnumbered) (bold, italics and
underline in original).
This Court has previously rejected claims of unconscionability in nursing
home arbitration agreements that were very similar to the Arbitration
Agreement in this case. In Cardinal, for instance, we held the trial court
erred in finding a nursing home arbitration agreement unconscionable and
unenforceable, “without even referencing the FAA or [Pennsylvania’s statutory
counterpart], much less giving due regard to their policy underpinnings
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favoring arbitration.” Cardinal, 155 A.3d at 53. This Court held that the
arbitration agreement, which was worded similarly to the Arbitration
Agreement in this case, was not unconscionable, and thus plaintiff’s survival
claim must proceed to arbitration, with the wrongful death claim bifurcated.
See id. at 53-55 (relying on this Court’s decision in MacPherson v. Magee
Mem’l Hosp. for Convalescence, 128 A.3d 1209 (Pa. Super. 2015) (en
banc)).
The MacPherson Court likewise held that an arbitration agreement
between the defendant nursing home (Manor Care) and patient was
enforceable and not unconscionable where the agreement contained the
following terms: (1) “the parties pay their own fees and costs”; (2) a provision
allowing the patient to rescind within thirty days; (3) “Manor Care will pay the
arbitrators’ fees and costs”; (4) a statement that there are no caps or limits
on damages other than those imposed by state law; (5) “a conspicuous, large,
bolded notification [stating] that the parties, by signing, are waiving the right
to a trial before a judge or jury”; and (6) a “bold typeface and underlined
[notice stating] the [a]greement . . . is voluntary, and if the patient refused
to sign it, ‘the Patient will still be allowed to live in, and receive services’ at
Manor Care.” MacPherson, 128 A.3d at 1221-22.
Accordingly, even if Gollick had challenged the Arbitration Agreement as
being unconscionable, the claim would fail.
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Consistent with the foregoing, we conclude the Arbitration Agreement
requires that Gollick’s survival claim be submitted to arbitration, and the trial
court abused its discretion in ruling otherwise. We therefore reverse the order
denying Appellants’ POs and remand to the trial court for proceedings
consistent with this decision.
Order reversed. Case remanded for further proceedings consistent with
this decision. Jurisdiction relinquished.
Judge King joins the memorandum.
Judge Nichols concurs in the result.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 7/29/2021
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