Judge Smacks Down Nursing Home For Trying to Force Arbitration on Customers

A judge in Pennsylvania did the right thing last week in tossing out a mandatory arbitration clause in a lawsuit concerning neglect at a nursing home.

Readers of this blog know that forcing people into arbitration when there’s a dispute that rightfully belongs in a court of law is never good for the aggrieved party. (See our blog, “Arbitration Agreements: Bad for Consumers, Good for Nursing Homes”.)

Forced arbitration not only deprives you of your right to be heard in a court of law, often it’s demanded of people when they’re in a vulnerable, helpless state. Arbitration, which is always forced onto consumers by businesses, never the other way around, is promoted as an objective, time-efficient and money-saving approach to settling disputes.

But the opposite usually is true: Arbitrators with a reputation for rewarding the plaintiff often find themselves out of work because industries remove them from the list of suitable arbitrators both sides must use to select one. Arbitration doesn’t necessarily save time and legal fees, because even if the consumer wins, he or she still retains counsel in many cases, and must pay a share of the arbitrator fees.

The Pennsylvania case concerned Manor Care, according to AboutLawsuits.com. It’s one of the largest nursing home management companies in the U.S. Its contract forced the family of a resident of a facility in Reading, Penn., to arbitrate their claim that their loved one was abused, and that the nursing home was negligent.

A woman discovered that her mother was taken to the nursing home by her day nurse. When the daughter arrived there, she was told to sign the arbitration agreement, as AboutLawsuits says, “during the emotional upheaval of discovering that her mother was there.”

Judge Jeffrey Sprecher ruled that the agreement was too heavily weighted in favor of the facility, was misleading and violated the law. He called the arbitration agreement “unconscionable,” and said that the daughter was not authorized to sign the agreement for her mother; that the agreement was designed so that the people signing it wouldn’t understand its effect.

“Most families and residents are unaware that they are signing away their right to file a nursing home lawsuit in the event the facility provides negligent or sub-standard care,” according to AboutLawsuits, “and that they have little choice but to sign the agreement when they are faced with the need to move themselves or a loved one into a skilled nursing facility.”

A similar forced arbitration agreement in a Florida Manor Care nursing home lawsuit also was found to be unenforceable in 2011. In that case, the Florida Supreme Court found that many of the provisions in the agreement, including a $350,000 cap on noneconomic damages and an agreement that the resident could never receive punitive damages, violated Florida law and could not be enforced.

Learn more about the evils of forced arbitration agreements on our blog, “Potential Dangers of Arbitration Agreements.”

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