Change of arbitrator doesn't necessarily void nursing home agreement, court rules
If an arbitrator specifically designated by an arbitration agreement contract is not available, an arbitration clause may still be enforceable, a federal district court decision suggests.
Earlier this month, the U.S. District Court for the District of South Dakota ruled on the case of Jones v. GGNSC Pierre LLC. After Carol Jones filed a wrongful death suit against Golden Living Center Pierre, a nursing home operator, it was discovered that the contractually agreed upon arbitrator, the National Arbitration Forum, no longer settled consumer disputes. The issue then became whether or not the arbitration agreement was enforceable, or if the court could appoint an arbitrator, according to the Bureau of National Affairs.
The court ruled that, although the contract designated the NAF as the arbitrator, that designation was not an integral part of the agreement. The language in the contract requiring arbitration in the event of a dispute was the more significant language, BNA reported. Also, a “severance provision” in the contract allowed for unenforceable provisions—such as using NAF as the arbitrator—to be severed from the contract in order to keep the other provisions—such as the one mandating arbitration—intact.