A recent ruling by the Pennsylvania Supreme Court could have “broad implications” for the future of nursing home arbitration agreements.
Last week’s ruling in Wert v. ManorCare of Carlisle rendered arbitration agreements that rely solely on the National Arbitration Forum unenforceable since the NAF is no longer able to accept arbitration cases.
The justices were split on whether the Federal Arbitration Act was enough to sustain agreements that listed NAF as the exclusive arbitrator. The NAF has been unable to handle arbitration disputes since it entered into a consent decree with the Minnesota Attorney General’s Office in 2009.
Many nursing homes have accepted the Minnesota consent decree and have stopped listing exclusive arbitrators in their contracts, so the court’s ruling will affect a relatively small portion of nursing home arbitration contacts. Despite the ruling’s tempered shockwaves, nursing homes and other industries that rely on arbitration suffer its “broad implications” in the future, one attorney told Legal Intelligencer.
“The justices recognized there’s a ‘lopsided balance of power’ between sophisticated business entities, such as nursing homes and their parent companies, and the residents that they deal with,” said Stephen Trzcinski, who represented plaintiff Evonne Wert in the case.
Wert v. ManorCare of Carlisle concerned a suit filed by Wert after the death of her mother at a ManorCare facility in Gettysburg, PA. Wert’s suit alleged that her mother’s death was due to abuse and neglect by the facility.