Nursing home arbitration agreements received another blow when the Florida Supreme Court ruled them invalid in two separate cases in November.
In Gessa vs. Manor Care of Florida Inc., Angela Gessa sued for negligence, violation of her rights as a resident and breach of fiduciary duties. In the second case, Shotts vs. OP Winter Haven Inc., Gayle Shotts sued OP Winter Haven, saying the nursing home committed negligence and breach of duty that led to the 2003 death of her uncle, Edward Henry Clark.
Both cases were appealed after the 2nd District Court of Appeal in Lakeland had affirmed decisions by trial judges to compel arbitration. Arbitration agreements are standard in most Florida nursing homes. They are designed to protect facilities against costly litigation. The Manor Care agreement above capped non-economic damages at $250,000.
Key issues the Gessa and Shotts cases addressed were whether the court or the arbitrator decides whether the arbitration agreement violates public policy.
The federal ruling covers only cases in which challenges had been made against provisions in the agreements that designate complaints to arbitration. In his opinions, Justice James Perry wrote that the state law has specific provisions around nursing home negligence.
“The [Florida] nursing home statute provides for the award of ‘punitive damages for gross or flagrant conduct or conscious indifference to the rights of the resident,’” he wrote.
In Shotts, Perry wrote that “any arbitration agreement that substantially diminishes or circumvents these remedies stands in violation of the public policy of the State of Florida and is unenforceable.”
Justice Ricky Polston dissented in both rulings. He wrote in Gessa that “the Florida Legislature, not this Court, should decide whether Florida’s public policy has been violated.”