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Diversicare Leasing Corp. v. Hutchison

United States District Court, E.D. Kentucky, Northern Division, Ashland

February 7, 2018

ROSE HUTCHINSON, as Administratrix of the Estate of JOHN HUTCHINSON, DEFENDANT.


          Henry R. Wilhoit Jr., Judge

         This matter is before the Court upon Plaintiffs' Motion to Compel Arbitration and Enjoin Defendant [Docket No. 8]. The matter has been fully briefed by the parties [Docket Nos. 8-1, 12 and 13]. For the reasons set forth herein, the Court will sustain the motion.


         This case arises from John Hutchinson's residency at South Shore Nursing & Rehabilitation Center, a nursing facility owned and operated by Plaintiffs. As part of the admissions process, on April 30, 2015, John Hutchinson executed admissions documents in connection with his admission to South Shore Nursing & Rehabilitation Center ("South Shore").Mr. Hutchinson signed numerous documents related to his admission to South Shore, including: Informed Consent to Decline Medical Treatment and/or Services; Resident Influenza Vaccine Release and Informed Consent; Request to Decline Cardiopulmary Resuscitation, and; Acknowledgment of Documents Signed and Reviewed. These documents are attached to Plaintiffs Motion as Exhibit A.

         The Admission Agreement contains an Arbitration Agreement, also executed by Mr. Hutchinson. The contract requires any claims arising out of the Admission Agreement or related to Mr. Hutchinson's medical care at South Shore are to be resolved exclusively through binding arbitration. It provides, "that any legal dispute, controversy, demand, or claim that arises out of or relates to the Resident Admission Agreement or is in any way connected to the Resident's stay at the Facility shall be resolved exclusively by binding Arbitration and not by a lawsuit or resort to other court process." [Docket No. 8-3].

         The Agreement expressly includes the following: any claim for payment, non-payment, or refund for services rendered to the Residency by the Facility, claims arising out of State or Federal law, claims based upon breach of contract, breach of fiduciary duty, violation of rights, fraud, or misrepresentation, common law or statutory negligence, gross negligence, malpractice, abuse, neglect or any other claim based on any departure from accepted standards of medical or nursing care, whether such claims be for statutory, compensatory, or punitive damages, and whether arising in the future or presently existing. Id.

         The signing parties acknowledged that they were "agreeing to mutual arbitration, regardless of which of us may make a claim, and that we will mutually benefit from the resolution of disputes through arbitration." Id.

         The Arbitration Agreement also states that Mr. Hutchinson had the right to consult with an attorney prior to signing the agreement. Id. It further states that Mr. Hutchinson could rescind the Agreement by providing written notice to the facility within 30 days. Id. According to the Complaint, Mr. Hutchinson did not provide such notice after he signed the Agreement.

         Mr. Hutchinson's daughter, Rose, filed an action in the Jefferson Circuit Court seeking money damages for alleged injuries to her father arising out of his residency at South Shore Nursing & Rehabilitation Center ("the State Court Action").

         Plaintiffs allege that Defendant has refused to arbitrate his claims. Therefore, they brought this petition under § 4 of the Federal Arbitration Act.

         Plaintiffs now move this Court to compel arbitration and enjoin the proceedings in the State Court Action.


         The Federal Arbitration Act ("FAA"), 9 U.S.C. § 1 et seq., "manifests a liberal federal policy favoring arbitration agreements." Masco Corp. v. Zurich American Ins. Co., 382 F.3d 624, 626 (6th Cir.2004) (quoting Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983)) (internal quotation marks omitted).

         Under the FAA, when contracts contain arbitration clauses, federal courts "are to examine the language of the contract in light of the strong federal policy in favor of arbitration, " and are required to resolve any ambiguities in the agreement or doubts as to the parties' intentions in favor of arbitration. Stout v. J.D. Byrider, 228 F.3d 709, 714 (6th Cir.2000); see also AT&T Techs., Inc. v. Communications Workers of Am.,475 U.S. 643, 650, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986) (explaining that when a "contract contains an arbitration clause, there is a presumption of arbitrability in the sense that an order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the ...

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