Courtyard Gardens Health & Rehabilitation, LLC v. Davis
2016 Ark. App. 608
| Ark. Ct. App. | 2016Background
- In 2009 Julius Marks was admitted to Courtyard Gardens nursing facility; his daughter Ericka Ann Davis signed admission papers and an arbitration agreement on his behalf under a power of attorney.
- The arbitration agreement required that disputes be resolved by binding arbitration and incorporated the National Arbitration Forum (NAF) Code of Procedure.
- Marks died in October 2013; in April 2014 Davis, as special administrator of his estate, sued Courtyard in Clark County Circuit Court for negligence/medical malpractice.
- Courtyard moved to compel arbitration under the incorporated arbitration agreement; Davis argued arbitration was impossible because the NAF no longer conducted consumer arbitrations following a consent decree with the Minnesota Attorney General.
- The circuit court denied the motion to compel arbitration as impossible to perform; Courtyard appealed to the Arkansas Court of Appeals.
Issues
| Issue | Plaintiff's Argument (Davis) | Defendant's Argument (Courtyard) | Held |
|---|---|---|---|
| Whether incorporation of NAF procedures makes arbitration impossible because NAF no longer handles consumer cases | The agreement is impossible to perform since the NAF is unavailable to administer consumer arbitrations | The NAF reference is ancillary; absence of NAF does not render the parties’ agreement to arbitrate impossible | Arbitration agreement remains enforceable; compel arbitration |
| Whether particular NAF rules (e.g., Rules 48(D)/(E)) allow plaintiff to sue in court despite arbitration clause | Rule provisions permit filing in court and thus arbitration is not required | Such rule-based arguments were rejected by Arkansas precedent and do not make arbitration impossible | Rule 48 arguments insufficient to avoid arbitration |
Key Cases Cited
- Courtyard Gardens Health & Rehabilitation, LLC v. Arnold, 485 S.W.3d 669 (Ark. 2016) (holding NAF’s unavailability did not make arbitration impossible where NAF reference was ancillary)
- GGNSC Holdings, LLC v. Lamb, 487 S.W.3d 348 (Ark. 2016) (reaffirming Arnold and rejecting Rule 48-based arguments to avoid arbitration)
- Green v. U.S. Cash Advance Ill., LLC, 724 F.3d 787 (7th Cir. 2013) (discussing NAF practices and related litigation)
- Meskill v. GGNSC Stillwater Greeley, LLC, 862 F. Supp. 2d 966 (D. Minn. 2012) (addressing legal issues arising from NAF consent decree)
- Miller v. GGNSC Atlanta, LLC, 746 S.E.2d 680 (Ga. Ct. App. 2013) (considering effects of NAF’s cessation of consumer arbitrations)