Valentine v. Plum Healthcare Grp., LLC

did not read the paperwork, nor did he talk to Lila about it.

Roy signed two arbitration agreements; one for arbitrating medical malpractice claims and the second for arbitrating all other claims, including wrongful death and elder abuse. Both agreements state they are binding on the parties and the parties' "heirs, representatives, executors, administrators, successors, and assigns[.]"

In addition, both agreements contain a clause that attempts to bind the resident's representative to arbitrate the resident's claims and the representative's individual claims if the representative signs the agreement instead of the resident. The clause reads: "By the signing [of] this agreement the resident intends to express that I have full authority to act as the resident's agent in making healthcare decisions for the resident. I have full and express authority as the resident's agent to waive the resident's right to a jury trial

Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951 , 972 [ 64 Cal.Rptr.2d 843 , 938 P.2d 903 ] ; Pagarigan v. Libby Care Center, Inc. (2002) 99 Cal.App.4th 298 , 301 [ 120 Cal.Rptr.2d 892 ] [ ].) Petitions to compel arbitration are resolved 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, 64 Cal.Rptr.2d 843 [ 938 P.2d 903 ] ; Code Civ. Proc., §§ 1281.2, 1290.2.) If the facts are undisputed, on appeal we independently review the case to determine whether a valid arbitration agreement exists. ( Garrison, supra , 132 Cal.App.4th at p. 263 [ 33 Cal.Rptr.3d 350 ] ; Buckner v. Tamarin (2002) 98 Cal.App.4th 140 , 142 [ 119 Cal.Rptr.2d 489 ].)" ( Flores v. Evergreen at San Diego, LLC (2007) 148 Cal.App.4th 581 , 586, 55 Cal.Rptr.3d 823 ( Flores ).)

"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 [ 119 Cal.Rptr.2d 489 ].) However, there are exceptions. For example, a patient who signs an arbitration agreement at a health care facility can bind relatives who present [certain] claims arising from the patient's

to be his agent who is not really employed by him." ( Civ. Code, § 2300.) "Ostensible authority is such as a principal, intentionally or by want of ordinary care, causes or allows a third person to believe the agent to possess." ( Civ. Code, § 2317.)

There is no evidence Lila intentionally designated Roy as her agent with authority to enter arbitration agreements on her behalf. Thus, if an agency

the capacity to make a health care decision, and a decision to the contrary must be made by a physician in writing. ( Prob. Code, §§ 4657, 4658, 4732.) There is no evidence Winter is a physician.

Roy testified Lila was capable to make her own health care decisions. She was present when he signed the documents, but she was unaware he was signing them or of what they were. Winter never told Lila about the paperwork, asked her if she could sign them, or asked her if Roy had authority to sign them as her agent.

Instead, Winter relied on Darleen's direction to have Roy sign the forms. There is no evidence in the record, however, that establishes Darleen had the authority either to execute arbitration agreements as Lila's agent or, if she had that authority, to delegate it to Roy.

According to Winter, Darleen was Lila's "responsible party." Nothing in the record defines that term. In the health care context, the term does not establish agency to execute arbitration agreements. "Facially, the status of agent, legal representative, or responsible party would not arise merely because of kinship. Using the ordinary meaning of these terms (see Pang v. Beverly Hospital, Inc. (2000) 79 Cal.App.4th 986 , 994 [ 94 Cal.Rptr.2d 643 ] ), an agent is a person to whom the principal has delegated authority; a legal representative is a person who has acquired authority through the legal process (i.e., a guardian or conservator); and a responsible party in the health care context is a person who assumes personal liability for the patient's bills ( Podolsky v. First Healthcare Corp. (1996) 50 Cal.App.4th 632 , 645 [ 58 Cal.Rptr.2d 89 ] )." ( Flores, supra , 148 Cal.App.4th at pp. 592-593, 55 Cal.Rptr.3d 823 .) Darleen's assumption of financial liability for Lila's bills does not establish Lila authorized Darleen to execute arbitration agreements as her agent.

Defendants nonetheless argue the evidence establishes Roy was Lila's ostensible agent. They contend that although Lila could not sign the agreements due to her shoulder injury, she maintained the mental capacity to consent (despite Winter's testimony), was present when Roy signed the agreements, had a sufficient opportunity to object, but instead remained silent. Defendants claim Lila's silence is "compelling" evidence.

Contrary to defendants' argument, Lila's silence in this instance was insufficient to convey ostensible authority to Roy to execute arbitration

wholesaler was carrier's ostensible agent where insurance broker had historically filed claims with wholesaler].)

Here, there is no past behavior by Lila or a prior relationship or course of conduct with her on which defendants could rely to establish Roy was her agent with authority to bind her to arbitration. And agency cannot be implied from the marriage relationship alone. ( Flores, supra , 148 Cal.App.4th at p. 589, 55 Cal.Rptr.3d 823 .) Her silence in this instance communicated nothing.

Defendants contend Lila on at least one prior occasion requested to them that Roy sign a document on her behalf. To support this contention, defendants submitted with their reply brief at trial a document entitled Physicians Orders for Life-Sustaining Treatment (POLST), dated December 2013. Someone wrote on the document, "resident has capacity but cannot sign - requested husband to sign." The document was submitted under a declaration signed by defendant's attorney, who attested only that the document was a true and correct copy. Defendants claim this evidence supports a finding that Roy was Lila's agent.

Plaintiffs objected to the document, but the trial court did not rule on the objection. In that circumstance, we presume the evidence was admitted and considered by the court, but the objection is preserved for our review on appeal. (See Reid v. Google, Inc. (2010) 50 Cal.4th 512 , 534, 113 Cal.Rptr.3d 327 , 235 P.3d 988 .) We find the trial court erred in admitting the evidence. New evidence is generally not permitted with reply papers. ( Jay v. Mahaffey (2013) 218 Cal.App.4th 1522 , 1537-1538, 161 Cal.Rptr.3d 700 .) More importantly, defendants laid no foundation to support the evidence.

The owners and operators of a skilled nursing facility contend the trial court erred when it denied their petition to compel arbitration. They attempted to enforce arbitration in this action for elder abuse and wrongful death brought by a decedent through her husband as successor in interest, her husband individually, and their children. Appellants claimed the successor had signed the arbitration agreements as the decedent's authorized agent. The trial court determined that although the successor did not sign the agreements as the decedent's agent, he expressly bound himself to arbitrate all claims he held individually and as the successor in interest. As a result, the decedent's claim for elder abuse and the husband's individual claim for wrongful death were subject to arbitration. However, the court denied the petition because the children's claims were not subject to arbitration, and allowing the arbitration and the litigation to proceed concurrently could result in inconsistent findings of fact and law.

We affirm the judgment.

FACTS AND PROCEEDINGS

A. Signing the arbitration agreements

Defendants Plum Healthcare Group, LLC, and White Fir Holdings, LLC, own and operate Midtown Oaks Post-Acute (Midtown), a skilled nursing facility. On January 13, 2014, Lila Valentine was admitted to Midtown for "rehab" after she fell and broke her right shoulder. The admission records

identified Lila's daughter, Darleen Valentine, as Lila's responsible party and Lila's husband, Roy Valentine, as an emergency contact and the primary financial contact.

On January 15, 2014, Juillet Winter, Midtown's admission coordinator, contacted Darleen about the signing of the admission documents. Winter said Lila was unable to sign the documents "due to her shoulder injury and her episodes of confusion." Darleen told Winter she was not in the area and to have her father, Roy, sign the papers.

On January 19, 2014, Roy signed the admission documents, including two arbitration agreements. Lila was present when Roy signed the papers, and she did not object to him signing the arbitration agreements on her behalf.

Roy recalled signing some documents when Lila was admitted to Midtown. A person from the facility told him he needed to sign some admission forms for his wife. The person did not say what the forms were, that they involved arbitration, or that there was a choice in the signing of the documents. The person never asked Roy if Lila was capable of signing the documents or discussed with him that the documents needed to be signed by Lila if she was capable. Roy asserts that had this issue been raised, he "certainly would have told" the facility employee that Lila was capable of making her own health care decisions.

While Roy signed the papers, it appeared to him that Lila was not aware of, or involved in, the process. The person from the facility never told Lila anything about the paperwork, and she did not ask Lila to sign the documents. The person never asked Lila if it was okay for Roy to sign the admission documents for her. Roy

results came back by 10:10 p.m. that evening, but the nurses simply "endorsed" the results to the night shift. At 1:39 a.m., May 12, 2014, Lila's family asked about the lab results. The physician's assistant then ordered a shot of antibiotics. No one monitored Lila's conditions.

No further entry was made in Lila's medical chart until approximately 10 hours

The court, however, found the arbitration agreements were not binding on the children's wrongful death claims. None of the children signed the agreements, and Lila could not bind them to arbitrate their claims. Under the rule of Ruiz v. Podolsky (2010) 50 Cal.4th 838 , 841, 114 Cal.Rptr.3d 263 , 237 P.3d 584 ( Ruiz ), as applied by this court in Bush v. Horizon West (2012) 205 Cal.App.4th 924 , 929, 140 Cal.Rptr.3d 258 , a patient of a skilled nursing facility can bind her heirs to arbitrate wrongful death claims arising only from medical malpractice, but not from elder abuse. The children did not allege medical malpractice or professional negligence.

Even though the court determined that Roy's successor and individual claims were subject to arbitration, it denied the petition to compel. It foresaw the possibility of conflicting rulings on common issues of law or fact if the children's wrongful death claims were litigated and Roy's wrongful death and elder abuse claims were arbitrated. Pursuant to discretion granted it in such a circumstance by Code of Civil Procedure section 1281.2 ( section 1281.2 ), the

Second, defendants contend the children's wrongful death claims are also subject to arbitration. The arbitration agreements' application to heirs and Roy's signing them as Lila's agent bound the children's claims to arbitration under Ruiz . As already stated, under Ruiz , a patient at a skilled nursing facility or her agent may bind her heirs to arbitrate wrongful death actions that arise from medical malpractice or professional negligence. Defendants argue the children's allegations of wrongful death allege professional negligence, not elder abuse, and are thus subject to arbitration.

Defendants assert that because each plaintiff's elder abuse and wrongful death claims are subject to arbitration, the court had no discretion under section 1281.2 or otherwise to deny arbitration. They ask us to reverse the court's ruling and direct the court either to order all claims against them to arbitration or allow arbitration of the elder abuse and wrongful death claims to proceed first.

We conclude the trial court did not abuse its discretion. Defendants did not establish that Roy signed the arbitration agreements as Lila's agent. As a result, he could not bind the children to arbitrate their wrongful death claims. Because the children would litigate their claims, the court was within its discretion to deny arbitration under section 1281.2 to prevent conflicting rulings on common issues of law and fact.

"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 [ 33 Cal.Rptr.3d 350 ] ( Garrison );

treatment. ( Mormile v. Sinclair (1994) 21 Cal.App.4th 1508 , 1511-1516 [ 26 Cal.Rptr.2d 725 ] ; Bolanos v. Khalatian (1991) 231 Cal.App.3d 1586 , 1591 [ 283 Cal.Rptr. 209 ].) 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 [ 33 Cal.Rptr.3d 350 ] ; see Buckner, supra , 98 Cal.App.4th at p. 142 [ 119 Cal.Rptr.2d 489 ].)' ( Flores, supra , 148 Cal.App.4th at p. 587 [ 55 Cal.Rptr.3d 823 ], fn. omitted.)" ( Goldman v. SunBridge Healthcare, LLC (2013) 220 Cal.App.4th 1160 , 1169, 164 Cal.Rptr.3d 11 ( Goldman ), original italics.)

Defendants mistakenly believe the trial court found on disputed facts that Roy bound Lila to the arbitration agreements as her agent. The trial court expressly found Roy was not acting as Lila's authorized agent when he signed the arbitration agreements. It stated Roy "did not sign those agreements as Lila's representative or agent in an attempt to bind Lila." Substantial evidence supports the trial court's finding.

"The existence of an agency relationship is a factual question for the trier of fact whose determination must be affirmed on appeal if supported by substantial evidence. ( Violette v. Shoup (1993) 16 Cal.App.4th 611 , 619 [ 20 Cal.Rptr.2d 358 ] ; Inglewood Teachers Assn. v. Public Employment Relations Bd. (1991) 227 Cal.App.3d 767 , 780 [ 278 Cal.Rptr. 228 ] ; Wickham v. Southland Corp. [ (1985) 168 Cal.App.3d 49 ,] 55 [ 213 Cal.Rptr. 825 ].) 'Only when the essential facts are not in conflict will an agency determination be made as a matter of law.' ( Wickham v. Southland Corp., supra , 168 Cal.App.3d at p. 55 [ 213 Cal.Rptr. 825 ] ; see Violette v. Shoup, supra , at p. 619 [ 20 Cal.Rptr.2d 358 ].)" ( Garlock Sealing Technologies, LLC v. NAK Sealing Technologies Corp. (2007) 148 Cal.App.4th 937 , 965, 56 Cal.Rptr.3d 177 .)

"An agent is one who represents another, called the principal, in dealings with third persons." ( Civ. Code, § 2295.) In California, agency is "either actual or ostensible." ( Civ. Code, § 2298.) An agency is actual "when the agent is really employed by the principal." ( Civ. Code, § 2299.) Actual authority "is such as a principal intentionally confers upon the agent, or intentionally, or by want of ordinary care, allows the agent to believe himself to possess." ( Civ. Code, § 2316.)

An agency is ostensible "when the principal intentionally, or by want of ordinary care, causes a third person to believe another

relationship exists, it is one based on Lila's want of ordinary care that caused either Roy or defendants to believe he had the authority to bind Lila to arbitration.

Defendants contend the evidence shows Roy believed he was Lila's actual agent because he and Lila were married, and he signed the agreements on the line marked "Resident's Representative" beneath the provision stating his signature indicated he had Lila's authority as her agent to enter into arbitration agreements for her.

We are not persuaded. Although Roy signed the agreements apparently believing he could do so, "the fact of belief is not enough. It must be shown that the belief was engendered by conduct of the principal. To hold otherwise would give any agent, not the authority, but the naked power to bind his principal to any contract within the general scope of his duties, however fantastic or detrimental to the principal's interest such contract may be." ( South Sacramento Drayage Co. v. Campbell Soup Co. (1963) 220 Cal.App.2d 851 , 856-857, 34 Cal.Rptr. 137 .) That he signed as Lila's "representative" did not cast him in the status of agent unless Lila's conduct engendered his belief and actions. ( Goldman, supra , 220 Cal.App.4th at p. 1176, 164 Cal.Rptr.3d 11 .)

"Before recovery can be had against the principal for the acts of an ostensible agent, three requirements must be met: The person dealing with an agent must do so with a reasonable belief in the agent's authority, such belief must be generated by some act or neglect by the principal sought to be charged and the person relying on the agent's apparent authority must not be negligent in holding that belief. ( Associated Creditors' Agency v. Davis (1975) 13 Cal.3d 374 , 399 [ 118 Cal.Rptr. 772 , 530 P.2d 1084 ] ; Hill v. Citizens Nat. Trust & Sav. Bk. (1937) 9 Cal.2d 172 , 175-176 [ 69 P.2d 853 ].) Ostensible agency cannot be established by the representations or conduct of the purported agent; the statements or acts of the principal must be such as to cause the belief the agency exists. ( Dill v. Berquist Construction Co. (1994) 24 Cal.App.4th 1426 , 1438, fn. 11 [ 29 Cal.Rptr.2d 746 ] ; Lee v. Helmco, Inc. (1962) 199 Cal.App.2d 820 , 834 [ 19 Cal.Rptr. 413 ].) ' "Liability of the principal for the acts of an ostensible agent rests on the doctrine of 'estoppel,' the essential elements of which are representations made by the principal, justifiable reliance by a third party, and a change of position from such reliance resulting in injury. [Citation.]" [Citation.]' ( Kaplan v. Coldwell Banker Residential Affiliates, Inc. (1997) 59 Cal.App.4th 741 , 747 [ 69 Cal.Rptr.2d 640 ].)" ( J.L. v. Children's Institute, Inc. (2009) 177 Cal.App.4th 388 , 403-404, 99 Cal.Rptr.3d 5 .)

Nothing Lila did could reasonably cause defendants to believe Roy was authorized to execute arbitration agreements for her. Juillet Winter,

defendant's employee, testified Lila could not sign the forms because of her injured shoulder and her "periods of confusion." Nothing in the record explains what Winter meant by "periods of confusion," whether she observed such periods, or whether she was qualified to make any kind of determination about Lila's capacity. Under Probate Code section 4657, a patient is presumed to have

agreements on her behalf. Occasionally, where " ' "the principal knows that the agent holds himself out as clothed with certain authority, and remains silent, such conduct on the part of the principal may give rise to liability. [Citation.]" [Citation.]' [Citations.]" ( Chicago Title Ins. Co. v. AMZ Ins. Services, Inc. (2010) 188 Cal.App.4th 401 , 426-427, 115 Cal.Rptr.3d 707 .)

However, in those instances, it was reasonable for the third party to rely on the purported agent despite his silence due to a historical relationship or course of conduct. (See Leavens v. Pinkham & McKevitt (1912) 164 Cal. 242 , 245-249, 128 P. 399 [manager was packing house's ostensible agent to purchase fruit based on his prior authorized purchases from plaintiff and others and the company's failure to indicate in any manner the manager lacked authority in this instance]; Chicago Title Ins. Co. v. AMZ Ins. Services, Inc., supra , 188 Cal.App.4th at pp. 408-409, 426-427, 115 Cal.Rptr.3d 707 [ostensible agency existed where insurance agent had previously bound insurer to issue insurance 30 to 40 times despite express agreement denying agency relationship]; Gulf Ins. Co. v. TIG Ins. Co. (2001) 86 Cal.App.4th 422 , 435-437, 439, 103 Cal.Rptr.2d 305 [insurance

There is no authentication of the signatures or the handwritten note, no eyewitness testimony of the document's execution or modification, no description of how the document came into counsel's possession, and no evidence the document was seen, possessed, or relied upon by defendants. Counsel does not testify she had personal knowledge of the subject matter, nor does she make any attempt to prove what the document purports to be. Evidence that lacks foundation is inadmissible, and a court abuses its discretion when it admits it. ( Wiley v. Easter (1962) 203 Cal.App.2d 845 , 856, 21 Cal.Rptr. 905 [evidence not admissible where no competent foundation laid; abuse of discretion to admit it].) We thus do not consider the evidence.

Defendants contend Roy and Lila's apparent decision not to rescind the arbitration agreements when they had 30 days to do so indicates Roy had the authority to sign them for Lila. In effect, defendants claim Lila ratified the arbitration agreements by not rescinding them. Not so. "The fundamental test of ratification by conduct is whether the releasor, with full knowledge of the material facts entitling him to rescind , has engaged in some unequivocal conduct giving rise to a reasonable inference that he intended the conduct to amount to a ratification." ( Union Pacific Railroad Co. v. Zimmer (1948) 87 Cal.App.2d 524 , 532, 197 P.2d 363 , italics added.) There is no evidence Lila knew the arbitration agreements existed, that Roy signed them, or that she had a right to rescind them. The fact Lila or Roy did not rescind the agreements, without more, does not indicate Roy signed them as Lila's agent.

The evidence establishes that Lila made no actions to establish Roy as her ostensible agent or to lead Winter to reasonably believe Roy was her agent. Roy signed the agreements based on Darleen's request to defendants, not on Lila's request or authorization. Defendants could not rely on Lila's silence in this instance as they had

DISPOSITION

The order denying the petition to compel arbitration is affirmed. Costs on appeal are awarded to plaintiffs. ( Cal. Rules of Court, rule 8.278(a).)

We concur:

RAYE, P. J.

HOCH, J.