552 S.W.3d 34
Ark. Ct. App.2018Background
- Resident Johnnie Mae Williams was admitted to Heritage Square nursing facility on June 5, 2015; she died five days later after alleged overfeeding.
- Songela Williams (daughter and special administrator) signed the facility Resident Admission Agreement and an Arbitration Agreement on behalf of the resident.
- The Arbitration Agreement required arbitration of all claims arising out of services provided by the facility and stated it would "inure to the benefit of" and bind the facility's agents, employees, and servants.
- Dr. Gerald Stipanuk served as Heritage Square's medical director under a written independent-contractor agreement; the agreement expressly characterized him as an independent contractor, not an employee, with certain oversight duties.
- The Estate sued Heritage Square and Dr. Stipanuk (as the resident’s treating/primary-care physician) for medical malpractice, negligence, and wrongful death; Heritage Square moved to compel arbitration and obtained a stay; the court denied arbitration as to Dr. Stipanuk because he was a nonsignatory and acted as the resident’s treating physician, not as the facility’s agent.
- Dr. Stipanuk appealed, arguing (1) he is covered by the arbitration clause as an agent/nonsignatory beneficiary and (2) the Agreement requires claims arising from the same course of care to be arbitrated together; alternatively, he argued estoppel.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a nonsignatory physician can be bound by the facility’s arbitration clause as its agent/beneficiary | Estate: Dr. Stipanuk is a treating physician and Estate did not rely on the admission agreement to create claims; physician is independent so not an agent | Dr. Stipanuk: Paragraph 14 makes the arbitration agreement bind facility’s "agents, employees, and/or servants," and he functioned as an agent/medical director | Court: No — doctor was an independent contractor, sued as treating physician, and not shown to be the facility’s agent; clause does not bind him |
| Whether claims against the nonsignatory doctor must be consolidated into arbitration because they arose from the same incident/course of care | Estate: Claims arise from physician’s own malpractice and exist independently of the admission agreement | Dr. Stipanuk: Paragraphs 2 and 5 require arbitration of all claims arising from services provided by the facility and consolidation of related claims | Court: No — physician treated as independent; his claims did not relate to performance/validity of admission agreement or facility services such that allowing suit would eviscerate the arbitration clause |
| Whether plaintiff is estopped from avoiding arbitration as to the doctor | Estate: Not applicable; Estate does not rely on the contracts to establish claims | Dr. Stipanuk: Estate is using contractual protections while avoiding arbitration, so estoppel should apply | Court: No — Cazort distinguishable; Estate’s claims exist regardless of the contract and it is not relying on the contract to advance the claims |
Key Cases Cited
- American Ins. Co. v. Cazort, 316 Ark. 314 (1994) (estoppel may bar a party from avoiding arbitration when it relies on the contract to its advantage but disclaims arbitration)
- HPD, LLC v. TETRA Techs., Inc., 424 S.W.3d 304 (Ark. 2012) (appellate standard and enforcement principles for arbitration agreements)
- GGNSC Holdings, LLC v. Lamb ex rel., 487 S.W.3d 348 (Ark. 2016) (de novo review of denial of motion to compel arbitration)
- Robinson v. EOR-ARK, LLC, 841 F.3d 781 (8th Cir. 2016) (nonsignatories closely related to signatories may compel arbitration to prevent evasion of an arbitration agreement)