685 S.W.3d 718
Tenn.2024Background
- Granville Williams, Jr. executed a broad durable power of attorney (POA) in 2007, granting his daughter, Karen Sams, authority in "all claims and litigation matters" but not expressly for health care decisions.
- In early 2020, Williams was admitted to Azalea Court, an assisted-living facility; on his behalf, Sams signed both the admission agreement and an optional arbitration agreement, which was not a condition of admission.
- Williams died two months later, and his son, James Williams, brought a wrongful-death action against the facility operators, alleging negligence and other torts.
- The defendants moved to compel arbitration under the signed agreement; the trial court and Court of Appeals denied the motion, finding Sams lacked authority under the POA to sign the arbitration agreement and that James Williams was not bound as a non-signatory.
- The Supreme Court of Tennessee granted review to decide if Sams had authority under the POA to bind Williams to arbitration, and if James Williams (and other wrongful-death beneficiaries) were bound by the arbitration agreement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1. Was signing the arbitration agreement a "health care decision" requiring specific POA authority? | Yes; Williams' POA did not grant health care decision authority; arbitration tied to admission is a health care decision. | No; signing was a legal, not health care, decision—especially since it was optional, not a condition of admission. | Not a health care decision; signing optional arbitration unrelated to actual consent to health care. |
| 2. Did the 2007 POA give Sams authority to sign the arbitration agreement? | No; absent specific health care powers in the POA, Sams had no authority. | Yes; POA's grant of authority over all claims/litigation includes consenting to arbitration. | POA covered all claims/litigation, thus authority existed. |
| 3. Are wrongful-death beneficiaries bound by the arbitration agreement, despite not signing it? | No; wrongful-death action is a new, personal cause, not derivative; non-signatories can't be bound. | Yes; wrongful-death claims are derivative of decedent's claims, so beneficiaries are in privity and bound. | Yes; beneficiaries step into decedent's shoes and are bound by his contracts (including arbitration). |
| 4. Should unique contract law/privity doctrines apply in this context? | Indirectly, argued that ordinary third-party contract rules mean beneficiaries aren’t bound. | Yes, traditional principles like privity and derivative claims mean binding effect. | Ordinary contract/privity principles apply and bind beneficiaries. |
Key Cases Cited
- Owens v. National Health Corp., 263 S.W.3d 876 (Tenn. 2007) (addressing attorney-in-fact authority under POA for health care decisions in context of mandatory arbitration agreement at nursing home admission)
- Beard v. Branson, 528 S.W.3d 487 (Tenn. 2017) (explaining nature of wrongful-death actions and who controls litigation)
- Flax v. DaimlerChrysler Corp., 272 S.W.3d 521 (Tenn. 2008) (noting wrongful death actions are derivative of decedent’s rights)
- Harvey ex rel. Gladden v. Cumberland Tr. & Inv. Co., 532 S.W.3d 243 (Tenn. 2017) (arbitration agreements are judged like other contracts)
- Tenn. Farmers Life Reassurance Co. v. Rose, 239 S.W.3d 743 (Tenn. 2007) (interpreting POA scope by its plain terms)
- Ki v. State, 78 S.W.3d 876 (Tenn. 2002) (clarifying wrongful-death suits assert decedent’s rights)
- Lynn v. City of Jackson, 63 S.W.3d 332 (Tenn. 2001) (wrongful death statute does not create a new cause of action for beneficiaries)
- Taylor v. Butler, 142 S.W.3d 277 (Tenn. 2004) (ordinary contract law applies to arbitration agreements)
