## Facts

- Northern Health Facilities operated Tremont Health and Rehabilitation Center, a nursing home.
- John Batz, who was blind, was admitted to the facility on January 26, 2012.
- At admission, John’s wife, Faith Batz, signed intake documents, including an ADR agreement requiring mediation and, if necessary, binding arbitration.
- The ADR agreement defined “Covered Disputes” broadly to include disputes related to the resident’s stay, including tort, negligence, malpractice, and death or wrongful death claims.
- The agreement warned, in conspicuous language, that signing waived the right to have disputes decided in court and limited appellate review.
- Faith signed on a line marked “Legal Representative,” and the signature block stated the facility could rely on the representative’s authority (actual, implied, or apparent).
- A nurse reported John was present, indicated Faith should sign due to his blindness, and did not object or suggest she lacked authority.
- John allegedly suffered a serious injury while at the facility, developed severe complications, and died about two months after admission.
- Faith sued the facility in Pennsylvania state court asserting negligence, wrongful-death, and survival claims.
- The facility filed a federal action under the Federal Arbitration Act (FAA) to compel arbitration and stay the state-court case.

## Issues

1. Whether an ADR/arbitration agreement signed by a nursing-home resident’s spouse as “Legal Representative,” without the resident’s signature, was valid and enforceable against the resident and his estate under Pennsylvania law.
2. Whether the negligence, survival, and wrongful-death claims fell within the scope of the agreement so that arbitration should be compelled and the state action stayed under the FAA.

## Decision

- The court granted the motion to compel arbitration.
- The court held the ADR agreement was valid and enforceable because Faith had at least apparent authority to sign on John’s behalf.
- The court held the state-court claims fell within the agreement’s broad definition of covered disputes, including claims for death or wrongful death.
- The court stayed the state-court proceedings pending arbitration.

## Legal Principles

- Under the FAA, a court compels arbitration when (1) a valid agreement to arbitrate exists and (2) the dispute falls within the agreement’s scope.
- State contract and agency law govern whether a non-signatory is bound to arbitrate through a representative’s signature.
- Apparent authority may bind a principal when the principal’s conduct would lead a reasonable third party to believe the agent was authorized to act.
- Broad arbitration clauses covering disputes “arising out of or related to” a nursing-home stay, expressly including negligence and death/wrongful-death claims, encompass litigation based on the resident’s care and resulting death.
- A contractual waiver of a judicial forum and jury trial is enforceable when the arbitration agreement is validly formed.

## Conclusion

The court enforced the nursing-home ADR agreement and compelled arbitration because the spouse’s execution of the agreement bound the resident through apparent authority, and the negligence, survival, and wrongful-death claims were within the agreement’s express and broad scope, warranting a stay of parallel state-court litigation under the FAA.


N. Health Facilities v. Batz, 993 F. Supp. 2d 485 (M.D. Pa. 2014)