ROBIN HUTCHESON et al., Plaintiffs and Respondents, v. ESKATON FOUNTAINWOOD LODGE et al., Defendants and Appellants.
C074846 (Super. Ct. No. 34-2012-00135467-CU-PO-GDS)
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA THIRD APPELLATE DISTRICT (Sacramento)
Filed 11/28/17 On rehearing
CERTIFIED FOR PUBLICATION
APPEAL from a judgment of the Superior Court of Sacramento County, David I. Brown, Judge. Affirmed.
Beach Cowdrey Owen, Thomas E. Beach and Darryl C. Hottinger for Defendants and Appellants.
Hanson Bridgett, James A. Napoli, Adam W. Hofmann, and Rachel P. Zuraw for California Assisted Living Association
The Law Office and Edward P. Dudensing for Plaintiffs and Respondents.
This case turns on whether an attorney-in-fact made a “health care decision” by admitting her principal to a residential care facility for the elderly and, in the process, agreeing to an arbitration clause. If she did, as the trial court found, she acted outside the scope of her authority under the power of attorney, and the arbitration clause this appeal seeks to enforce is void.
To answer this question, we must define the scope оf two statutes, the Power of Attorney Law (
We conclude admission of decedent to the residential care facility for the elderly in this instance was a health care decision, and the attorney-in-fact who admitted her, acting under the PAL, was not authorized to make health care decisions on behalf of the principal.
As a result of this conclusion, we affirm the trial court‘s denial of a motion by the residential care facility to compel arbitration. Because the attorney-in-fact acting under the PAL did not have authority to make health care decisions for her principal, her execution of the admission agreement and its arbitratiоn clause are void.
FACTS AND PROCEDURAL HISTORY
For ease of reference, we refer to a power of attorney for health care, as authorized under the HCDL (
Decedent Barbara Lovenstein executed a health care POA in 2006. She appointed her niece, plaintiff Robin Hutcheson, as her attorney-in-fact
Four years later, in 2010, Lovenstein executed a personal care POA, using the form set forth in the PAL. She designated her sister, plaintiff Jean Charles, and Hutcheson as her attorneys-in-fact. Lovenstein granted them the authority to act for her on a number of different subjects, including “[p]ersonal and family maintenance,” and “[c]laims and litigation.” The form expressly did not authorize anyone to make “medical and other health-care decisions” for her. Each attorney-in-fact had the authority to act alone on all matters within their authority under the personal care POA that are relevant here. The personal care POA became effective immediately.
Prior to February 24, 2012, Lovenstein lived with Charles. At times, Charles served as Lovenstein‘s care provider; at other times, she oversaw care provided to Lovenstein by in-home care providers, including their administration of medicine. Charles declared she knew Lovenstein had assigned Hutcheson to make health care decisions. It was Lovenstein‘s desire throughout her lifetime that Hutcheson make health care decisions for her.
On February 24, 2012, Charles voluntarily admitted Lovenstein to defendant Eskaton FountainWood Lodge (FountainWood). FountainWood is a licensed “residential care facility for the elderly” under the California Residential Care Facilities for the Elderly Act (
The admission agreement contained an arbitration clause. The clause in general required all claims arising from Lovenstein‘s care at FountainWood to be submitted to binding arbitration. The clause bound the parties’ heirs, representatives, and successors, and it remained in effect after the admission agreement terminated for the resolution of all claims.
At some point, FountainWood requested to know who Lovenstein had assigned to make health care decisions for her. Hutcheson and Charles provided FountainWood with Lovenstein‘s health care POA that named Hutcheson as the attorney-in-fact over Lovenstein‘s health care.
A medical appraisal performed the day of her admission disclosed Lovenstein was suffering from dementia and seizures. She was confused and disoriented. She engaged in inappropriate, aggressive, and wandering behaviors. She was not able to follow instructions consistently, and she was depressed. She required “complete” supervision.
On March 22, 2012, Charles went to FountainWood to pack Lovenstein‘s belongings and move Lovenstein into her home. However, Lovenstein choked on her lunch at FountainWood that day and was transferred to a hospital. Doctors diagnosed her with aspiration pneumonia and severe dysphagia (difficulty in swallowing). She remained hospitalized until March 28, 2012, and died on April 11, 2012.
At Charles‘s request, FountainWood provided the records it kept on Lovenstein. Lovenstein‘s health care POA was included in the documents FountainWood gave to Charles.
There is no evidence in the record that Hutcheson, Lovenstein‘s attorney-in-fact for health care under the health care POA, was contacted by FountainWood or involved in any of the decisions and actions regarding Lovenstein‘s admission to, stay at, or discharge from FountainWood.
Hutcheson, as successor in interest on behalf of Lovenstein, and Charles sued defendants. In their first amended complaint, Hutcheson sought damages for elder abuse and fraud, and Charles sought damages for negligent infliction of emotional distress.
FountainWood petitioned the trial court to compel arbitration pursuant to the mandatory arbitration clause contained in the admission agreement. The trial court denied the petition, ruling the arbitration agreement was invalid. The court reasoned the admission of Lovenstein to FountainWood and the agreement to arbitrate as part of that admission were health care decisions, and Charles did not have the authority under her personal care POA to make health care decisions for Lovenstein.
FountainWood appeals from the trial court‘s order. It contends the arbitration agreement is valid because Charles‘s decision to admit Lovenstein to FountainWood was not a health care decision, and Charles was authorized
DISCUSSION
I
Standard of Review
” ‘Although “[t]he law favors contracts for arbitration of disputes between parties” (Player v. Geo. M. Brewster & Son, Inc. (1971) 18 Cal.App.3d 526, 534), ” ‘there is no policy compelling persons to accept arbitration of controversies which they have not agreed to arbitrate. . . .’ ” (Weeks v. Crow (1980) 113 Cal.App.3d 350, 353, quoting Freeman v. State Farm Mut. Auto. Ins. Co. (1975) 14 Cal.3d 473, 481 . . . .)’ (Victoria v. Superior Court (1985) 40 Cal.3d 734, 744.) ‘The party seeking to compel arbitration bears the burden of proving the existence of a valid arbitration agreement. (Garrison v. Superior Court (2005) 132 Cal.App.4th 253, 263 (Garrison); Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 972; Pagarigan v. Libby Care Center, Inc. (2002) 99 Cal.App.4th 298, 301.) Petitions to compel arbitration are resоlved by a summary procedure that allows the parties to submit declarations and other documentary testimony and, at the trial court‘s discretion, to provide oral testimony. (Engalla, supra, 15 Cal.4th at p. 972;
“As the Flores court explained, ‘Generally, a person who is not a party to an arbitration agreement is not bound by it. (Buckner v. Tamarin, supra, 98 Cal.App.4th at p. 142.) However, there are exceptions. For example, a patient who signs an arbitration agreement at a health care facility can bind relatives who present claims arising from the patient‘s treatment. (Mormile v. Sinclair (1994) 21 Cal.App.4th 1508, 1511-1516; Bolanos v. Khalatian (1991) 231 Cal.App.3d 1586, 1591.) Further, a person who is authorized to act as the patient‘s agent can bind the patient to an arbitration agreement. (Garrison, supra, 132 Cal.App.4th at pp. 264-266; see Buckner, supra, 98 Cal.App.4th at p. 142.)’ (Flores, supra, 148 Cal.App.4th at p. 587, fn. omitted.)” (Goldman v. SunBridge Healthcare, LLC (2013) 220 Cal.App.4th 1160, 1169, original italics.)
II
Admission to FountainWood was a Health Care Decision
This case pivots on whether Charles‘s admitting Lovenstein to FountainWood and executing the arbitration clause was a “health care” decision. Lovenstein‘s personal care POA did not authorize Charles to make health care decisions for Lovenstein. Neither the personal care POA nor the PAL define a health care decision. However, the HCDL does define a health care decision, and it applies to all health care POA‘s. (
Our analysis seeks primarily to understand the Legislature‘s intent for adopting the HCDL and its definitions. We employ familiar rules of statutory construction. “Our fundamental task . . . is to determine the Legislature‘s intent so as to effectuate the law‘s purpose. We first examine the statutory language, giving it a plain and commonsense meaning. We do not examine that language in isolation, but in the context of the statutory framework as a whole in order to determine its scope and purpose and to harmonize the various parts of the enactment. If the language is clear, courts must generally follow its plain meaning unless a literal interpretation would result in absurd consequences the Legislature did not intend. If the statutory language permits more than
one reasonable interpretation, courts may consider other aids, such as the statute‘s purpose, legislative history, and public policy. [Citations.]” (Coalition of Concerned Communities, Inc. v. City of Los Angeles (2004) 34 Cal.4th 733, 737.)
Charles‘s authority under Lovenstein‘s personal care POA is set forth in the PAL. Under that law, a personal care POA may authorize, as Lovenstein‘s
The authority regarding Lovenstein‘s claims and litigation includes the authority to submit claims to arbitration. (
However, the PAL does not apply to health care POA‘s, and the personal care POA does not authorize an attorney-in-fact to make decisions regarding the principal‘s “health cаre.” (
By contrast, the HCDL authorizes a competent adult to execute a power of attorney for “health care.” (
These are very broad definitions, and at first glance they appear to define the care FountainWood agreed to provide Lovenstein. “Health care” is defined as “any” care or service that maintains or affects a person‘s physical or mental condition, a “health care provider” is an individual authorized or permitted to provide “health care” in the ordinary course of business, and a “health care institution” is a facility licensed to provide such “health care” as its business
We recognize the term “health care” cannot be read for purposes of the PAL and the HCDL as literally “any” care that affects a person‘s condition. To do so would include within its scope much of what the Legislaturе has classified as “personal care” under the PAL. And the Legislature has clearly stated that “personal care” is not “health care” for purposes of the personal care POA.4
The PAL and the HCDL define personal care primarily as providing for the necessities of living at a basic level. Neither law mentions making decisions about the principal‘s health care other than paying for it. But is a decision to place someone in a residential care facility for the elderly, particularly to receive dementia care, more than providing for the basic necessities of living? We conclude it is in this case. Charles contracted with FountainWood to provide Lovenstein with health care as well as personal care.
A residential care facility for the elderly is statutorily defined as “a housing arrangement chosen by persons 60 years of age or over, or their authorized representative, where varying levels and intensities of care and supervision, protective supervision, personal care, or health-related services are provided, based upon their varying needs . . . .” (
was enacted in 1973 with the primary purpose of ensuring that residents of state hospitals would have access to safe, alternative community-based housing.
“(e) Progress in the field of gerontology has provided new insights and information as to the types of services required to allow older persons to remain as independent as possible while residing in a residential care facility for the elderly.
“(f) The fluctuating health and social status of older persons demands a system of residential care that can respond to these needs by making available multilevels of service within the facility, thus reducing the need for residents with fluctuating conditions to move between medical and nonmedical facilities.
“(g) Residential care facilities for the elderly which are not primarily medically oriented represent a humane approach to meeting the housing, social and service needs of older persons, and can provide a homelike environment for older persons with a variety of care needs.” (
Residential care facilities are “not primarily medically oriented” (
However, residential care facilities for the elderly may also provide types of care that go beyond personal care and include health care. For example, a residential care facility for the elderly may provide dementia care. This is a higher level of care administered by staff members specifically trained on issues of “hydration, skin care, communication, therapеutic activities, behavioral challenges, the environment, and assisting with activities of daily living.”
Since the parties completed initial briefing in this appeal, the Legislature has clarified that residential care facilities for the elderly that accept patients with restricted health conditions must ensure those residents “receive medical care as prescribed by the resident‘s physician . . . by appropriately skilled professionals acting within the scope of their practice.” (
We also infer from the PAL‘s definition of personal care that some forms of custodial care may qualify as health care. The PAL defines personal care in part as paying for “necessary medical, dental, and surgical care, hospitalization, and custodial care.” (
Care and services involving health care cannot be authorized by an attorney-in-fact acting only under a personal care POA. When residential care facilities for the elderly provide health care, they and their employees who provide such care are, respectively, “health care institutions” and “health care providers” for purposes of the HCDL, and a third-party contracting for these services as agent for another person may not do so when acting under a personal care POA.
FountainWood contends it did not agree to provide, nor did it provide, health care to Lovenstein. We disagree. The record demonstrates Charles, acting under her personal care POA, contracted with FountainWood to provide health care. Among other things, FountainWood agreed to provide
There is little doubt the Legislature intended the type of custodial care FountainWood agreed to provide Lovenstein to qualify as health care for purposes of the HCDL and the personal care POA. The HCDL‘s definition of “health care” was derived from and is virtually identical to its definition originally contained in the Uniform Law Commissioners’ Model Health-Care Consent Act (the Uniform Consent Act), a model health care representative law adopted by the National Conference of Commissioners on Uniform State Laws in 1982. (Handbook of the Nat. Conf. of Comrs. on U. State Laws & Proceedings 298 (1982) (Handbook).)6 The National Conference of Commissioners explained the Uniform Consent Act‘s definition of “health care” was ”broader in scope than medical care and includes care and treatment which is lawful to practice under state law, for instance, nursing care.” (Id. at p. 301, italics added.) The Legislature adopted this definition when it enacted the HCDL‘s predecessor statute. (Stats. 1983, ch. 1204, § 10, p. 4615; see 17 Cal. Law Revision Com. Rep. (1984) pp. 103, 117-118.)
In 1999, in response to a new uniform act, the Uniform Health-Care Decisions Act (9 West‘s U. Laws Ann. (2005) U. Health-Care Decisions Act, pp. 83, 85), the California Law Revision Commission proposed, and the Legislature adopted, the HCDL. (Stats. 1999, ch. 658, § 39, p. 4860; see 29 Cal. Law Revision Com. Rep. (1999) pp. 1, 5.) The HCDL drew “heavily” from the Uniform Health-Care Decisions Act. (29 Cal. Law Revision Com. Rep., supra, at p. 5.) It reenacted the same definition of ” ‘[h]ealth care,’ ” and it enacted for the first time the definitions of ” ‘health care decision’ ” and ” ‘health care institution’ ” as described above. (
The Law Revision Commission‘s comments on the terms ” ‘health care’ ” and ” ‘health care institution’ ” show it intended those terms to apply to custodial care and residential cаre facilities that provide
residential-care facility, home health agency or hospice.” (Ibid., italics added.) (
” ‘The official comments of the California Law Revision Commission “are declarative of the intent not only of the draftsman of the code but also of the legislators who subsequently enacted it” [citation], [and thus] the comments are persuasive, albeit not conclusive, evidence of that intent [citation].’ ” (Metcalf v. County of San Joaquin (2008) 42 Cal.4th 1121, 1132.) Here, the history and comments, in light of the statute‘s language, demonstrate the Legislature intended the HCDL to apply to decisions concerning custodial care rendered by a residential care facility for the elderly that involve health care. An attorney-in-fact such as Charles operating under a personal care POA, as opposed to a health care POA, does not have the authority to obtain such health care for her principal.
FountainWood argues we have it wrong. In addition to asserting it did not contract to provide health care, an argument we just rejected, FountainWood contends Charles‘s executing the admission agreement was not a health care decision because FountainWood is not a “health care institution.” It argues it is not a “health care institution” because it is not treated as a “health facility” under statutes other than the HCDL and the PAL, and it is not a “health care institution” under the terms of the HCDL itself. At oral argument, FountainWood also argued the arbitration clause was enforceable because Charles had authority outside of that personal care POA to admit Lovenstein and she had authority under the persоnal care POA to submit claims to arbitration. We disagree with each argument.7
FountainWood correctly states it is not a licensed “health facility” for purposes of licensing requirements imposed on medical care facilities. State statute requires persons and entities to obtain a license to operate a health facility. (
FountainWood also correctly states because it is not a health facility under Health and Safety Code section 1250, it is not entitled to the liability protections provided to
care decisionmaking process. However, in Young v. Horizon West, Inc. (2013) 220 Cal.App.4th 1122, 1129, the court, without expressly stating whether a decision to admit someone to a care facility is a health care decision, ruled in dicta that the authority to make health care decisions under a health care POA did not include the authority to execute an arbitration agreement unless expressly granted in the health care POA. In any event, it did not say the holder of a personal care POA can execute an arbitration clause in a health care agreement while lacking authority to execute the health care agreement itself. Charles in this instance made a health care decision she had no authority to make under the personal care POA.
health facilities under the Medical Injury Compensation Reform Act of 1975 (
FountainWood also directs us to statutes that govern patient access to their health care records. One of these statutes authorizes an adult patient of a “health care provider” to gain access to his or her patient records. (
Health and Safety Code section 1250, as well as a number of specified health care professionals, including physicians, surgeons, podiatrists, dentists, psychologists, and various therapists. (
None of these statutes, however, mandates how we interpret the HCDL and the PAL and whether FountainWood is a “health care institution” that provides “health care” under those laws. Heath care is defined differently for purposes of the PAL than it is defined in the statutes FountainWood recites. ” ‘[W]hen the Legislature uses materially different language in statutory provisions addressing the same subject or related subjects, the normal inference is that the legislature intended a difference in meaning. [Citation.]’ [Citation.]” (Kleffman v. Vonage Holdings Corp. (2010) 49 Cal.4th 334, 342.)
The Legislature adopted the HCDL not as a means of regulating the provision of health care, but as a way to protect an adult‘s “fundamental right to control the decisions relating to his or her own health care” and to protect “individual autonomy.” (
FountainWood contends the reasoning in Kotler, supra, 63 Cal.App.4th 1381, should apply here. Kotler does not help FountainWood. The Kotler court determined a residential care facility for the mentally ill, a type of community care facility, was not a “health facility” under Health and Safety Code section 1250 and thus not entitled to the protections of MICRA. The appellate court acknowledged the facility provided “incidental medical services” and “health-related services” (Kotler, supra, 63 Cal.App.4th at pp. 1393-1394) similar to those that residential care facilities for the elderly may provide. However, the court held a “residential care facility which provides only incidental medical services is not a health facility.” (Id. at p. 1394, italics omitted.) It would be a health facility only if the medical services it provided constituted “a substantial component of the total services provided.” (Id. at p. 1393.)
Kotler did not consider whether a residential care facility for the elderly was a “health care institution” under the HCDL and for purposes of defining the scope of a personal care POA. Unlike Health and Safety Code section 1250, as interpreted by Kotler, the HCDL does not define a “health care institution” as only those facilities whose provision of medical care constitutes a substantial component of the total services provided. As we explained, it defines a health care institution as any entity that provides care—any care—to maintain or affect a person‘s physical or mental condition. We and the Kotler court are addressing different questions.
Even if FountainWood was not a health care institution, its employees who provide care or services that include health care to maintain a person‘s physical or mental condition qualify as health care providers for purposes of the HCDL and, in turn, the personal care POA. Charles did not have authority under her personal care POA to engage those employees to provide health care to Lovenstein.
FountainWood next raises a different line of attack. Instead of arguing we should interpret the HCDL and the personal care POA consistent with other statutes that apply to medical care facilities, FountainWood directs us to
The HCDL, in addition to defining a “health care provider” and a “health care institution,” specifically defines a “residential care facility for the elderly” and gives that term its statutory definition found in Health and Safety Code section 1569.2, quoted above. (
In one such statute, Probate Code section 4674, the HCDL prohibits “[t]he рatient‘s health care provider or an employee” of that provider and the “operator or an employee of a residential care facility for the elderly” from witnessing the execution of a health care POA. (
Another statute, Probate Code section 4659, prohibits the “supervising health care provider or an employee of the health care institution where the patient is receiving care” and an operator or employee of a “residential care facility” where the patient is receiving
care from serving as an attorney-in-fact under a health care POA. (
In its reply brief and at oral argument, FountainWood raised another argument. It contended Charles had authority to admit Lovenstein outside of the personal care POA, and, combined with the authority granted under the personal care POA to submit claims to arbitration, she could agree to the arbitration clause as part of admitting Lovenstein. In other words, whether or not admitting Lovenstein was a health care decision, agreeing to the arbitration clause was not. FountainWood did not raise this argument in its opening brief, and, accordingly, has forfeited it. (Julian v Hartford Underwriters Ins. Co. (2005) 35 Cal.4th 747, 761, fn. 4.) Even if FountainWood had raised the argument, we would reject it. Charles did not have authority to execute the health care agreement, including the arbitration clause, because Hutcheson‘s authority was known to FountainWood.
Persons other than those named as attorneys-in-fact under a health care POA may admit someone to a residential care facility for the elderly. Obviously, conservators and guardians have this authority. State regulations also authorize a person to be admitted by her spouse or family member. (22 Cal. Code Regs. §§ 87101, subd. (r)(3), (r)(5), (r)(6); 87457, subd. (b); 87507, subd. (c).) The HCDL also authorizes a patient to designate a surrogate to make health care decisions whether or not the patient has a health care POA. (
Moreover, a person named as an attorney-in-fact in a health care POA may not necessarily have exclusive authority to make health care decisions on behalf of her principal. But such an attorney-in-fact “has priority over any other pеrson in making health care decisions” for the resident so long as the attorney-in-fact “is known to the health care provider to be reasonably available and willing to make health care decisions.” (
FountainWood complains that being subject to the HCDL is unfair. It contends it is unfair for plaintiffs to claim FountainWood is a “health care institution” under the HCDL in order to void the arbitration agreement, and then later claim FountainWood is not a “health facility” or a “health care provider” under MICRA and thus not protected by MICRA‘s cap on noneconomic damages. While we understand FountainWood‘s concern, we must leave it to the Legislature to address that issue. In the meantime, residential care facilitiеs for the elderly can protect themselves against unlimited liability by ensuring its health care agreements containing arbitration clauses are executed by persons having legal authority to do so. Charles was not such a person in this case.
Ultimately, “a court must adopt the construction most consistent with the apparent legislative intent and most likely to promote rather than defeat the legislative purpose and to avoid absurd consequences.” (In re J.W. (2002) 29 Cal.4th 200, 213.) Our interpretation meets that standard. The Legislature intended that a decision to admit someone to a residential care facility for the elderly for the provision of health care is a health care decision under the HCDL, and it required that such a health care decision, if made pursuant to a power of attorney, be made pursuant to a health care POA. A personal care POA under the PAL does not authorize the attorney-in-fact to make a health care dеcision. As a result, Charles‘s decision to agree to arbitration as part of admitting Lovenstein is void as she had no authority to execute an arbitration agreement as part of making a health care decision.
Ostensible Agency
FountainWood contends Charles‘s and Lovenstein‘s behavior led FountainWood to believe Charles had the authority to execute the arbitration agreement and thus created an ostensible agency we should enforce. We disagree.
“An agency is ostensible when the principal intentionally, or by want of ordinary care, causes a third person to believe another to be his agent who is not really employed by him.” (
FountainWood introduced no facts showing Lovenstein intentionally or negligently caused it to believe Charles was her agent for purposes of executing the health care agreement containing the arbitration clause. FountainWood argues there is no evidence Lovenstein or Charles affirmatively informed it that Charles was not authorized to execute the agreement. FountainWood, however, came into possession of Lovenstein‘s health care POA that named Hutcheson as Lovenstein‘s health care attorney-in-fact, yet it did not raise the discrepancy with Charles or Hutcheson or seek Hutcheson‘s authorization to render health care to Lovenstein and execute the arbitration agreement. Lovenstein‘s silence and possible lack of capacity do not constitute negligence in this instance. No ostensible agency was created.
The order of the trial court denying FountainWood‘s motion to compel arbitration is affirmed. Costs on appeal are awarded to plaintiffs. (Cal. Rules of Court, rule 8.278(a).)
NICHOLSON, Acting P. J.
We concur:
MAURO, J.
DUARTE, J.