Young v. Horizon West, Inc.

Filed 10/28/13
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SIXTH APPELLATE DISTRICT
MARYLIN YOUNG, H038736
(Santa Clara County
Plaintiff and Respondent, Super. Ct. No. 112CV218720)
v.
HORIZON WEST, INC., et al.,
Defendants and Appellants.
In this appeal, the owners and operators of a skilled nursing facility appeal from an
order denying their motion to compel arbitration with their former patient, plaintiff and
respondent Marylin Young. Appellants assert error in the trial court's determination that
plaintiff's daughter, Bobbi Young,1 lacked authority to sign an arbitration agreement on
plaintiff's behalf. Appellants further contend that the agreement was not unconscionable
and therefore should have been enforced. We agree with the trial court that Bobbi's
execution of the arbitration agreement was unauthorized; accordingly, we must affirm the
order on that ground alone.
1 In this opinion plaintiff's daughter will be referred to as "Bobbi" and plaintiff's husband
as "Robert" to make it clear which "Young" is indicated.
Background2
On September 16, 2010 plaintiff, who was then 88 years old, suffered a stroke.
After a week's hospitalization, she was transferred to Monterey Pines Skilled Nursing
Facility (Monterey Pines), where she remained for 10 days until her discharge on
October 4, 2010. Plaintiff's complaint describes the following events: On September 29,
2010, about halfway through her stay at the facility, plaintiff told her daughter, Bobbi,
that she needed to leave immediately. Though the stroke had impaired her ability to
communicate, plaintiff managed to explain that "she had woken up in bed the previous
night with her catheter removed and laying [sic] out next to her on her bed, causing the
entire bed and her body to be wet. She heard male voices next to her bed and seeing [sic]
the curtains around her bed moving. She also heard someone 'fiddling' with the nurse call
button next to her bed." Plaintiff later told the police that when she woke up her gown
was off, and an unknown male assistant was looking at her naked in bed. The assistant
said to her, " 'This is why I love my job.' "
Bobbi discovered that the call button had been unplugged, making plaintiff's
attempts to call a nurse fruitless. At about the same time, plaintiff developed
"unexplained deep bruising on her inner thigh and pelvis region and began complaining
of severe pain to her pelvis and upper thighs for the first time."
Bobbi arranged for plaintiff's removal from the facility, and the family brought her
home. Plaintiff continued to have difficulty speaking and was not independently mobile,
but "[o]nce [she] was able to be moved more frequently and more easily and to speak
clearer [sic], she started complaining of extreme pain in her lower region, particularly her
vaginal area, buttocks area, and her inner thighs." It turned out that plaintiff had
2 Our summary of the procedural background of this case is necessarily derived from
plaintiff's complaint, as the merits have not yet been determined by trial or other fact-
finding proceeding.
2
contracted genital herpes. Robert, her husband of nearly 70 years, had been her only
sexual partner, and he tested negative for the virus.
Plaintiff brought this action on February 15, 2012, naming Monterey Pines; its
owners, Horizon West, Inc. and Horizon West Headquarters, Inc. (collectively, "Horizon
West"); and a group of entities (the "Plum defendants") that had bought Monterey Pines
in June 2011 and renamed the facility "Cypress Ridge Care Center." Plaintiff asserted
four causes of action: elder abuse and neglect, negligence in the care of plaintiff,
violation of plaintiff's rights under the Patients' Bill of Rights (Cal. Code of Regs., tit. 22,
§ 72527), and successor liability against the Plum defendants.
All of the first three causes of action were founded on the allegation that the staff
at Monterey Pines had failed to provide a safe environment and protect her from sexual
assault. She asserted that male residents were allowed to enter female residents' rooms,
and call lights were either nonfunctioning or purposely disconnected by the staff.
Plaintiff further described a longstanding pattern of "reckless neglect" of the facility's
residents that had resulted in "numerous citations and deficiencies relating to the physical
abuse of residents and other incidents of substandard care." Plaintiff also pointed to the
failure of either Horizon West or the Plum defendants to investigate plaintiff's allegation
of rape, which meant that other residents were at risk of being sexually assaulted and
infected with an incurable sexually transmitted disease.
On April 9, 2012, plaintiff, by then 90 years old, moved for trial-setting preference
under Code of Civil Procedure section 36, subdivision (a).3 Both the Horizon and Plum
defendants opposed the motion, arguing that (1) there was no evidence or even allegation
3 Code of Civil Procedure section 36, subdivision (a), states: "A party to a civil action
who is over 70 years of age may petition the court for a preference, which the court shall
grant if the court makes both of the following findings: [¶] (1) The party has a
substantial interest in the action as a whole. [¶] (2) The health of the party is such that a
preference is necessary to prevent prejudicing the party's interest in the litigation."
3
of a medical condition requiring trial preference; (2) the case was not yet "at issue";
(3) plaintiff had not submitted a declaration attesting to proper service on all parties; and
(4) there was "no competent evidence" that plaintiff was over 70 years of age.
Horizon and Monterey Pines, joined by the Plum defendants, then moved to stay
the action and compel arbitration, citing Code of Civil Procedure sections 1281.2, 1281.4,
and 1295. The motion was based on an agreement Bobbi had signed when plaintiff was
admitted to Monterey Pines. Plaintiff opposed the motion, primarily on the grounds that
(1) Bobbi had no authority to bind her mother to arbitration in signing the admission
papers and (2) even if she did have such authority, the arbitration agreement was
procedurally and substantively unconscionable.
After extensive briefing and oral argument, the trial court denied defendants'
motion to compel arbitration and granted plaintiff's motion for preferential trial setting.
Only Horizon and Monterey Pines (hereinafter appellants) filed a notice of appeal,
limited to the order denying defendants' motion.
Discussion
The central issue before us is whether there existed a valid agreement entitling
appellants to nonjudicial arbitration of plaintiff's claims. In denying defendants' motion
the trial court reasoned that (1) compelling arbitration would be inconsistent with the
Legislature's intent that litigants in plaintiff's circumstances receive trial preference;
(2) Bobbi lacked authority, either actual or ostensible, to bind her mother to arbitration
when she signed the admission papers containing the agreement; and (3) the
circumstances surrounding execution of the arbitration agreement were "troubling."
Appellants argue that the court erred to the extent that it relied on the "possibility"
of inconsistent decisions.4 They also take issue with the court's consideration of trial
4 In a supplemental brief to the trial court, plaintiff had argued that the third cause of
action for violating the Patients' Bill of Rights was not arbitrable (Code Civ. Proc.,
4
preference in its ruling. Neither of these points warrants this court's review. The court
clearly discounted the significance of any inconsistency between trial on the
nonarbitrable claim (the third cause of action for violating the Patients' Bill of Rights)
and arbitration, as the result was dictated by the absence of Bobbi's authority to sign the
agreement. The court's belief that granting defendants' motion would be inconsistent
with plaintiff's entitlement to a grant of trial preference under section 36 is also of no
value to this court, as we review the court's ruling, not its rationale. (Cf. Davey v.
Southern Pac. Co. (1897) 116 Cal. 325, 329 ["a ruling or decision, itself correct in law,
will not be disturbed on appeal merely because given for a wrong reason"].)
We therefore turn to the principal question of whether plaintiff was bound by the
agreement her daughter signed on her behalf—specifically, whether Bobbi had the
authority to represent plaintiff in agreeing to arbitration. This issue presents both factual
questions — e.g., did plaintiff specifically authorize Bobbi to sign the agreement for
her—and legal issues—e.g., did plaintiff's advanced health care directive confer such
authority on her daughter. Only if Bobbi did have that authority do we consider the next
question, whether the agreement itself was unconscionable.
Our review is governed by settled principles. To the extent that the lower court's
order is based on a finding of material fact, we adopt a substantial evidence standard.
(Robertson v. Health Net of California, Inc. (2005) 132 Cal.App.4th 1419, 1425.) On the
other hand, questions of law, including the legal effect of the undisputed contract
language, is reviewed de novo. (Buckner v. Tamarin (2002) 98 Cal.App.4th 140, 142;
Baker v. Osborne Development Corp. (2008) 159 Cal.App.4th 884, 892.)
§ 1430, subd. (b)); thus, she argued, a verdict after trial on this claim could be
inconsistent with an arbitrator's decision, contrary to Code of Civil Procedure section
1281.2, subdivision (c).
5
"The party seeking to compel arbitration bears the burden of proving the existence
of a valid arbitration agreement." (Flores v. Evergreen At San Diego, LLC (2007) 148
Cal.App.4th 581, 586 (Flores), citing Engalla v. Permanente Medical Group, Inc. (1997)
15 Cal.4th 951, 972.) "Although California has a strong policy favoring arbitration
[citations], our courts also recognize that the right to pursue claims in a judicial forum is
a substantial right and one not lightly to be deemed waived. [Citations.] Because the
parties to an arbitration clause surrender this substantial right, the general policy favoring
arbitration cannot replace an agreement to arbitrate." (Marsch v. Williams (1994) 23
Cal.App.4th 250, 254.) Courts therefore recognize that the right to arbitration depends on
a contract. "Even the strong public policy in favor of arbitration does not extend to those
who are not parties to an arbitration agreement or who have not authorized anyone to act
for them in executing such an agreement." (County of Contra Costa v. Kaiser
Foundation Health Plan, Inc. (1996) 47 Cal.App.4th 237, 245; Benasra v. Marciano
(2001) 92 Cal.App.4th 987, 990.) Nevertheless, "a person who is authorized to act as the
patient's agent can bind the patient to an arbitration agreement." (Flores, supra, 148
Cal.App.4th at p. 587.)
Appellants' first theory regarding Bobbi's authority to bind plaintiff to arbitration
is that she was plaintiff's agent, based on a power of attorney for health care (POA),
which was part of plaintiff's advanced health care directive. The POA provided that
when plaintiff's primary physician determined that she was unable to make her own
health care decisions, her "agent" was authorized to make specified health care decisions
for her. Appellants concede that plaintiff's physician never made this determination, but
they maintain that the evidence supplied in her deposition established her complete
incapacity and need for Bobbi's intervention. As the trial court recognized, however,
such evidence does not substitute for satisfaction of the condition stated in the terms of
plaintiff's advanced health care directive.
6
Probate Code section 4682 makes this clear: "Unless otherwise provided in a
power of attorney for health care, the authority of an agent becomes effective only on a
determination that the principal lacks capacity, and ceases to be effective on a
determination that the principal has recovered capacity." On the POA form, plaintiff
elected not to check the box allowing her "agent" to make health care decisions for her
without a prior determination of incapacity by her physician. This important fact
distinguishes the case before us from Garrison v. Superior Court (2005) 132 Cal.App.4th
253, on which appellants rely. In Garrison, the durable power of attorney signed by the
decedent was "effective immediately" when she signed it. Here, plaintiff expressed her
clear intention not to make the POA effective until her physician deemed her "unable to
make [her] own health care decisions."
Similarly, appellants admit that Bobbi was not plaintiff's primary "health care
agent" under the POA. Plaintiff's husband, Robert, assumed that role; Bobbi was to be
the "first alternate agent" only if Robert was "not willing, able, or reasonably available to
make a health care decision for [plaintiff]." Appellants argue that plaintiff's and Robert's
deposition testimony supported the conclusion that Robert was "in poor health and
recovering from a stroke," and therefore "not able or reasonable [sic] available to make
health care decisions for Plaintiff." Appellants made this assertion to the trial court,
which implicitly rejected their position on this factual issue and relied instead on the
document's clear prerequisite to her agent's assumption of responsibility.5 It was the
province of the trial court as the trier of fact to weigh "all the affidavits, declarations, and
other documentary evidence, as well as oral testimony received at the court's discretion,
to reach a final determination." (Engalla v. Permanente Medical Group, Inc., supra, 15
5 Plaintiff offered evidence contradicting appellants' portrayal of Robert as incapable of
making health care decisions for plaintiff. Bobbi testified that it was her father who made
the decision at the hospital to administer immediate treatment to diminish the effects of
the stroke.
7
Cal.4th at p. 972.) Accordingly, our standard of review is " 'the same as for a judgment
following oral testimony: We must accept the trial court's resolution of disputed facts
when supported by substantial evidence; we must presume the court found every fact and
drew every permissible inference necessary to support its judgment, and defer to its
determination of credibility of the witnesses and the weight of the evidence.' [Citation.]"
(Engineers & Architects Assn. v. Community Development Dept. (1994) 30 Cal.App.4th
644, 653.)
Finally and most importantly, the POA contains no terms authorizing the patient's
agent to make any decisions other than "health care decisions" for the patient. Appellants
strive to avoid the legal effect of this omission, again citing Garrison v. Superior Court,
supra, 132 Cal.App.4th 253. Garrison, however, is distinguishable for this reason as
well. There the durable power of attorney included "the power to sign '[a]ny necessary
waiver or release from liability required by a hospital, or physician.' " (Id. at p. 259.)
The reviewing court did, however, express the view that the term "health care decisions"
made by an agent encompasses the execution of arbitration agreements on behalf of the
patient. So broad an interpretation of "health care decisions" seems unnecessary to the
result in Garrison, and to the extent that the court intended such a general application, we
disagree with its conclusion.
Appellants further argue that even if Bobbi was not plaintiff's agent under the
POA, plaintiff nonetheless expressly authorized her to act in that capacity. The
deposition evidence she supplies for this fact, however, was properly rejected by the trial
court. According to appellants, plaintiff testified that she had expressly authorized her
daughter to "act and make decisions on her behalf." What plaintiff actually stated,
however, was that her daughter knew from conversations what her wishes were, "[t]o
receive the care that was possible at the time." The context presented to plaintiff at this
time was Bobbi's understanding of plaintiff's wishes for medical treatment when plaintiff
was hospitalized immediately after the stroke. No mention was made of authorization to
8
sign any agreements other than for medical services, either at the hospital or later, at
Monterey Pines. Likewise immaterial is plaintiff's statement regarding her daughter's
authority "to complete paperwork" on her behalf when she arrived at Monterey Pines.
When asked whether Bobbi had such authority, plaintiff said only, "As far as I know, she
had permission to take care of details like that." This testimony is a far cry from
expressly authorizing her daughter to sign an agreement forgoing her right to a jury trial.
The trial court thus did not err in ruling that there was "no direct evidence of plaintiff's
acquiescence."6
Weakest of all is appellants' assertion, repeated in their reply brief, that plaintiff's
husband "confirmed" that their daughter was authorized to act on their behalf. The
testimony they offer is Robert's statement that Bobbi was their "legal guardian." This
characterization was nothing more than a legal conclusion unsupported by any facts, and
it was indeed contradicted by all of the other evidence, including the terms of plaintiff's
advanced health care directive.
Appellants next contend that plaintiff is bound by equitable estoppel. Of the nine
decisions they cite addressing this doctrine, none involves facts comparable to the case
before us. All apply the doctrine either to compel a signatory plaintiff to arbitrate with a
nonsignatory defendant (e.g., Boucher v. Alliance Title Company, Inc. (2005) 127
6 Appellants' suggestion that "it appears that the Court did not even consider" the
testimony that their daughter had such authority is not well taken. Unless the trier of fact
acts arbitrarily, it may reject entirely the testimony of a plaintiff. (Foreman & Clark
Corp. v. Fallon (1971) 3 Cal.3d 875, 890.) We may not reweigh the witness's credibility,
and we must "accept as true all evidence and all reasonable inferences from the evidence
tending to establish the correctness of the trial court's findings and decision, resolving
every conflict in favor of the judgment." (Howard v. Owens Corning (1999) 72
Cal.App.4th 621, 631.) Similarly unavailing is appellants' suggestion that plaintiff "could
have easily" signed a declaration stating that she had not authorized her daughter to sign
the arbitration agreement. Such a document might have made plaintiff's opposition to the
motion stronger, but it was unnecessary. It was appellants' burden to establish Bobbi's
authority to sign the agreement, and they failed to do so on the evidence they supplied.
9
Cal.App.4th 262, 268; Metalclad Corp. v. Ventana Environmental Organizational
Partnership (2003) 109 Cal.App.4th 1705, 1718; Herbert v. Superior Court (1985) 169
Cal.App.3d 718, 725), or to compel arbitration by the nonsignatory family members of a
signatory patient (e.g., Bolanos v. Khalatian (1991) 231 Cal.App.3d 1586, 1591-1592
[child and spouse]; Mormile v. Sinclair (1994) 21 Cal.App.4th 1508, 1515 [spouse];
Pietrelli v. Peacock (1993) 13 Cal.App.4th 943, 946-947 [unborn child].) None held an
injured patient to an arbitration agreement signed on her behalf by a family member on
an equitable theory that the family member was the patient's agent.
Nor does one isolated sentence from Crowley Maritime Corp. v. Boston Old
Colony Ins. Co. (2008) 158 Cal.App.4th 1061 help appellants. The issue there was
whether liability insurers who had settled an action could be compelled to arbitrate their
equitable contribution claim against the nonsettling insurers. Affirming the trial judge,
the reviewing court held that they could not, because "equitable contribution arises not
from contract but from equity." (Id. at p. 1068.) The court next rejected the appellant
insurers' argument that the respondent insurers could be compelled to arbitrate under the
plaintiff's agreement with the appellant insurers. The appellants had confused the
doctrine of equitable contribution with equitable subrogation. The former did not compel
the respondent insurers to stand in the shoes of the plaintiff, who had signed the
agreement with the appellant insurers. The multiple insurers involved had individually
contracted with their insureds, not with one another. Thus, the respondent insurers could
not be compelled to arbitrate under an agreement to which they were not a party.
Equitable estoppel based on a "preexisting relationship" was not a viable alternative,
because (a) such a relationship did not exist; and (b) the respondent insurers were "not
suing for direct benefits under the insurance contracts with [plaintiff] Crowley," but
sought from "other insurers benefits [r]espondents have provided to Crowley." (Id. at p.
1071.) Clearly Crowley has no application to this case. Plaintiff did not sue for a "direct
benefit" under her contract with the nursing facility, but complained of noncontractual
10
injury received during her stay there. And unlike the cases cited by appellants, the
arbitration provision on which they rely never became effective in the first place.
"A valid claim for equitable estoppel requires: (a) a representation or concealment
of material facts; (b) made with knowledge, actual or virtual, of the facts; (c) to a party
ignorant, actually and permissibly, of the truth; (d) with the intention, actual or virtual,
that the ignorant party act on it; and (e) that party was induced to act on it. [Citation.]
There can be no estoppel if one of these elements is missing." (Simmons v. Ghaderi
(2008) 44 Cal.4th 570, 584; see also Southern Cal. Edison Co. v. Public Utilities Com.
(2000) 85 Cal.App.4th 1086, 1110.) In this case, the critical threshold element is
missing: Plaintiff did not represent or conceal any fact. Equitable estoppel is not
available to appellants in plaintiff's suit against them.
Appellants' next theory is that plaintiff's daughter had ostensible authority to bind
plaintiff to arbitration. Their entire argument on this point is that Bobbi herself, by
signing the admission paperwork, represented that she was "designated, authorized or
employed as Plaintiff's agent and that she intended for Plaintiff to be bound by the
agreements. Plaintiff's daughter allowed defendants to believe that she had the authority
to act on Plaintiff's behalf." But ostensible authority cannot be created merely by a
purported agent's representation. As appellants themselves recognize (without citing the
applicable statute), "[a]n agency is ostensible when the principal intentionally, or by want
of ordinary care, causes a third person to believe another to be his agent who is not really
employed by him." (Civ. Code, § 2300, italics added.) "An agent has such authority as
the principal, actually or ostensibly, confers upon him." (Civ. Code, § 2315.) Ostensible
authority "is such as a principal, intentionally or by want of ordinary care, causes or
allows a third person to believe the agent to possess." (Civ. Code, § 2317, italics added.)
Several appellate decisions, most of them not mentioned in appellants' briefs, have
confirmed these tenets. In Pagarigan v. Libby Care Center, Inc. (2002) 99 Cal.App.4th
298, a patient's adult children sued a skilled nursing facility as their mother's successors
11
in interest (as well as on their own behalf, for wrongful death). The superior court denied
the facility's petition to compel arbitration and the appellate court affirmed. Merely
signing arbitration agreements after their mother's admission did not give the plaintiffs
authority to bind her to arbitration. Nor was there any evidence that their mother, who
was "comatose and mentally incompetent," had done anything that "caused [the
defendants] to believe [that] either of her daughters was authorized to act as her agent in
any capacity." (Id. at p. 302.)
The court in Goliger v. AMS Properties, Inc. (2004) 123 Cal.App.4th 374followed the lead of Pagarigan. There a rehabilitation facility unsuccessfully argued that
the plaintiff's daughter was either actually or ostensibly authorized to agree to arbitration
of plaintiff's negligence claims. It was not enough that the plaintiff "let" her daughter act
for her by making medical decisions and arranging treatment for her. (Id. at p. 376.) The
appellate court also found it significant that the daughter had signed the arbitration
agreements as "responsible party" but left the line for "agent" blank. (Id. at pp. 376-377.)
Flores, supra, 148 Cal.App.4th 581 is the one relevant case appellants try to
distinguish. They do not succeed. In that case Josephina Flores's husband, Luis, signed
the arbitration agreements upon Josephina's admission to the defendant nursing facility.
As was true for Bobbi in the case before us, there was no power of attorney in Luis at the
time of his wife's admission. The appellate court rejected the facility's ostensible-
authority argument -- i.e., that Luis "represented himself as his wife's agent, as shown by
his conduct of signing all the admission papers on her behalf, and that Josephina 'allowed
[Evergreen] to believe that [Luis] had the authority to act on her behalf.' " (Id. at p. 586.)
The court agreed with the trial judge that this conduct was irrelevant, and that there was
no evidence that Josephina herself, who was suffering from dementia and other ailments,
had done anything to cause the facility to believe that Luis was her agent. (Id. at p. 588.)
Similar facts were presented in Warfield v. Summerville Senior Living (2007) 158
Cal.App.4th 443. There, too, the patient's husband signed an arbitration agreement after
12
she was admitted. Following Flores, the appellate court rejected the facility's argument
that the husband had ostensible authority to bind the plaintiff, because there was
"absolutely no evidence of the wife's 'express or implied consent to have her husband act
as her agent.' " (Id. at p. 448, quoting Flores, supra, 148 Cal.App.4th at p. 589.) Also
without merit was the facility's argument that the plaintiff, by having "never once voiced
disagreement" with the living arrangement and services selected by her husband,
acquiesced in her husband's representation as her agent. Even if the facility had supplied
evidence of this factual assertion, "the failure of a resident suffering from dementia to
object to the living arrangements her husband had made would hardly constitute evidence
that she had authorized him to act as her agent in waiving her right to a jury trial." (Ibid.)
Because there was no evidence of her husband's agency in the plaintiff's conduct,
ostensible authority had not been shown.
As in Pagarigan, Flores, Goliger, and Warfield, here appellants offer nothing to
suggest that plaintiff acted in any way to cause the facility's admissions coordinator to
believe that plaintiff's daughter was authorized to sign an arbitration agreement on
plaintiff's behalf. As the Flores court cogently explained, "an agency cannot be created
by the conduct of the agent alone; rather, conduct by the principal is essential to create
the agency. Agency 'can be established either by agreement between the agent and the
principal, that is, a true agency [citation], or it can be founded on ostensible authority,
that is, some intentional conduct or neglect on the part of the alleged principal creating a
belief in the minds of third persons that an agency exists, and a reasonable reliance
thereon by such third persons.' [Citations.] ' " 'The principal must in some manner
indicate that the agent is to act for him, and the agent must act or agree to act on his
behalf and subject to his control.'. . ." [Citations.] Thus, the "formation of an agency
relationship is a bilateral matter. Words or conduct by both principal and agent are
13
necessary to create the relationship. . . ." ' " (Flores, supra, 148 Cal.App.4th at pp. 587-
88, quoting Van't Rood v. County of Santa Clara (2003) 113 Cal.App.4th 549, 571.)7
The trial court here was clearly not convinced that plaintiff did anything to permit
an inference of ostensible authority. The admissions coordinator, Jacqueline Auker,
stated in her declaration that it was her "custom and practice" to provide the arbitration
agreement to the resident "and/or his legal representative/agent [and] answer any
questions that he/she may have." In this situation, it would have been the purported
representative, plaintiff's daughter, who could have articulated questions and expressed
consent.8 But even if we assume that Auker showed the agreement to the "resident" (i.e.,
plaintiff) on this occasion, there is no evidence of a response by plaintiff that permitted a
reasonable belief that her daughter was authorized to sign an arbitration agreement as her
agent. Likewise, in its role as trier of fact the superior court was entitled to reject as
insufficient Auker's statement that "[b]ased on my custom and practice, I would have
confirmed with Marylin Young that Bobbi Young had her permission to sign documents
on the resident's behalf."
"A third person . . . is not compelled to deal with an agent, but if he does so, he
must take the risk. He takes the risk not only of ascertaining whether the person with
7 These principles are not, of course, confined to the setting of the nursing facility. In
any application of either ostensible agency or ostensible authority, the validity of that
relationship cannot be established solely by the representations or conduct of the
purported agent; "there must be evidence of conduct by the principal which causes a third
party reasonably to believe the agent has [such] authority." (Lindsay-Field v. Friendly
(1995) 36 Cal.App.4th 1728, 1734; J.L. v. Children's Institute, Inc. (2009) 177
Cal.App.4th 388, 404; see also Preis v. American Indemnity Co. (1990) 220 Cal.App.3d
752, 761 ["Ostensible authority must be established through the acts or declarations of
the principal and not the acts or declarations of the agent"], citing People v. Surety
Insurance Co. (1982) 136 Cal.App.3d 556, 562.)
8 Indeed, by appellants' own description, plaintiff was "unable to communicate, talk, or
even see upon her admission to Defendants' facility." "Nobody could understand her."
14
whom he is dealing is the agent, but also of ascertaining the scope of his powers." (Ernst
v. Searle (1933) 218 Cal. 233, 240; see also Lindsay-Field v. Friendly, supra, 36
Cal.App.4th at p. 1734 [absent showing of ostensible authority, those dealing with an
assumed agent "are bound at their peril to ascertain the extent of the agent's authority"].)
Even if there were sufficient evidence that Bobbi had actually represented that she was
authorized to bind plaintiff to arbitration, appellants took the risk that she in fact had no
such authority. Absent proof of agency either through direct evidence or through reliance
on plaintiff's own conduct, appellants failed to demonstrate Bobbi's actual or ostensible
authority to bind plaintiff.
Appellants reach far in their final attack on the trial court's findings regarding
Bobbi's authority: The court used the wrong standard of proof. This assertion is based
solely on two sentences in the trial court's order. First, the court stated, " . . . this court is
not convinced that plaintiff's daughter had her authority to bind her to arbitration during
admission to defendants' facility. It was clear that plaintiff could not commit herself to
the agreement." Next, in discussing ostensible authority based on Auker's declaration,
the court stated, "There is no direct evidence of plaintiff's acquiescence. This court is not
convinced that plaintiff agreed to binding arbitration." By highlighting these statements
appellants argue that the trial judge incorrectly imposed on them a "clear and convincing
evidence" standard rather than making its findings by a preponderance of the evidence.
We are, to put it simply, unconvinced. Using the common word "convinced" in
stating a factual finding is no more improper than a statement by our Supreme Court that
juror unanimity in a theory of murder is unnecessary " 'as long as each juror is convinced
beyond a reasonable doubt that defendant is guilty of murder . . . . ' [Citation.]" (People
v. Valdez (2012) 55 Cal.4th 82, 153.)9 If use of the word "convinced" were precluded in
9 Indeed, criminal jury instructions freely use the word "convinced" without creating any
apparent confusion. CALCRIM No. 376, for example, reminds the jury that it may not
15
articulating or following a standard lower than clear and convincing evidence, then the
civil jury instruction routinely employed to define "preponderance of the evidence"
would have been invalidated long ago.10 Here the court could have said that it was "not
convinced by a preponderance of the evidence," but such detail would have been
unnecessary to convey the intended meaning and scope of the court's finding to any
reasonable recipient of the ruling. In any event, there is nothing in the court's explanation
of its ruling that even remotely indicates that it did not understand and apply the correct
burden of proof.
We thus find no error in the trial court's determination that plaintiff's daughter
lacked authority, either actual or ostensible, to bind plaintiff to arbitration with
appellants. Because the arbitration agreement is of no effect for this reason, it is
unnecessary to address plaintiff's additional challenge to the agreement as
unconscionable, nor need we determine whether any of plaintiff's claims are beyond the
reach of the agreement. (See Neary v. Regents of University of California (1992) 3
convict a criminal defendant of any crime "unless you are convinced that each fact
essential to the conclusion that the defendant is guilty of that crime has been proved
beyond a reasonable doubt." CALCRIM No. 224 also uses the term "convinced":
"Before you may rely on circumstantial evidence to conclude that a fact necessary to find
the defendant guilty has been proved, you must be convinced that the People have proved
each fact essential to that conclusion beyond a reasonable doubt. [¶] Also, before you
may rely on circumstantial evidence to find the defendant guilty, you must be convinced
that the only reasonable conclusion supported by the circumstantial evidence is that the
defendant is guilty." CALCRIM No. 3519, pertaining to lesser offenses, tells the jury, "If
all of you find that the defendant is not guilty of a greater charged crime, you may find
(him/her) guilty of a lesser crime if you are convinced beyond a reasonable doubt that the
defendant is guilty of that lesser crime. . . . " CALJIC instructions long in use before the
adoption of CALCRIM also used the term "convinced" in explaining necessary jury
findings under the "beyond a reasonable doubt" standard. (See CALJIC Nos. 8.87, 8.71,
8.72.)
10 BAJI No. 2.60 defined "preponderance of the evidence" as "evidence that has more
convincing force than that opposed to it."
16
Cal.4th 273, 284 ["The well-established rule is that we should avoid advisory opinions"];
cf. Morning Star Co. v. State Bd. of Equalization (2006) 38 Cal.4th 324, 342.)
Disposition
The order denying appellants' motion is affirmed.
________________________________
ELIA, J
WE CONCUR:
____________________________
RUSHING, P.J.
____________________________
PREMO, J.
Young v. Horizon West, Inc.
H038736
17
Trial Court: Santa Clara County Superior Court
Trial Judge: Hon. Kevin E. McKenney
Attorneys for Defendants
And Appellants: Beach Whitman Cowdrey,
Thomas E. Beach and
Darryl C. Hottinger
Attorneys for Plaintiff
And Respondent: Needham Kepner & Fish,
Craig Needham and
Kirsten Fish
Smith & McGinty,
Daniel U. Smith and
Valerie T. McGinty
Stebner & Associates,
Kathryn Stebner and
Karman Ratliff
Young v. Horizon West, Inc.
H038736
18