Cortez v. Avalon Care Center Tucson, L.L.C.
226 Ariz. 207
| Ariz. Ct. App. | 2010Background
- Frances Cortez admitted to La Colina nursing home December 2005 and died two months later.
- Frances's daughter Juanita filed negligence, abuse/neglect, and wrongful death claims in December 2007.
- Avalon answered in March 2008 and moved to compel arbitration in February 2009 after discovering the arbitration agreement.
- Trial court granted arbitration, finding Avalon did not repudiate rights and that the agreement was enforceable.
- Juanita argued Avalon waived the arbitration right by conduct and by delaying its assertion.
- This appeal reverses, holding Avalon waived the arbitration right and remands for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did Avalon waive arbitration by conduct? | Juanita: Avalon conduct inconsistent with arbitration. | Avalon: No waiver since unaware initially; conduct not intentional relinquishment. | Avalon waived the arbitration right by conduct. |
| Was Avalon's knowledge enough to constitute waiver? | Juanita: constructive knowledge suffices; Avalon knew or should have known. | Avalon: waiver requires actual knowledge; not aware until file located. | Constructive knowledge found; waiver valid. |
| Must prejudice be shown to prove waiver due to delay? | Juanita: prejudice shown by substantial litigation delay and discovery burden. | Avalon: prejudice not required if conduct shows lack of intent to arbitrate. | Prejudice shown; waiver sustained. |
Key Cases Cited
- Bolo Corp. v. Homes & Son Constr. Co., 105 Ariz. 343 (Ariz. 1970) (waiver by conduct when seeking same relief as arbitration)
- Meineke v. Twin City Fire Ins. Co., 181 Ariz. 576 (Ariz. 1994) (waiver by substantial participation in litigation)
- City of Phoenix v. Fields, 219 Ariz. 568 (Ariz. 2009) (waiver through substantial litigation activity; early demand favored arbitration policy)
- Rancho Pescado, Inc. v. Nw. Mut. Life Ins. Co., 140 Ariz. 174 (Ariz. App. 1984) (arbitration favored as expeditious, inexpensive resolution)
- EFC Dev. Corp. v. F.F. Baugh Plumbing & Heating, Inc., 24 Ariz. App. 566 (Ariz. App. 1975) (examples of inconsistent acts indicating waiver)
- In re Noel R. Shahan Irrevocable & Inter Vivos Trust, 188 Ariz. 74 (Ariz. App. 1996) (prejudice can be shown by extended litigation participation)