The Georgia Court of Appeals recently vacated a lower court ruling that a nursing home resident lacked capacity to enter into an agreement to arbitrate her disputes. The Court did not reverse the trial court, but rather sent the case back to the trial court for more hearings, concluding the trial court used the wrong standard and shifted the burden of proof when ruling on the motion to compel arbitration.
The patient was living home alone when she fell. After surgery, she was admitted to the nursing home. On admission, the patient had a number of chronic medical conditions and a “history of some cognitive impairments.” The month before she fell, she had two visits to the emergency department for feeling “loopy and out of sorts, with some memory loss.” On neurological exam, she was noted to have mild cognitive impairment, depression, and amnesia. But, on admission to the hospital, she was able to give treatment consent.
On admission to the nursing home, she was taking narcotic pain medication. After admission, she was assessed as having episodes of confusion, forgetfulness, anxiety, and other cognitive deficits. The patient passed away and her family and estate sued the nursing home. The nursing home moved to compel arbitration based on the patient’s election to arbitrate in the admission agreement. In ruling on the motion, the trial court used a summary judgment standard and ruled that the nursing home bore the burden of proving the absence of evidence for the plaintiffs’ claims that the patient lacked capacity. In other words, the trial court required the nursing home to point out that the plaintiffs couldn’t prove the negative.
The Court of Appeals concluded the trial court used the wrong legal standard. The law in Georgia is that a party may seek an order compelling arbitration and the trial court shall “summarily hear and determine the issue.” O.C.G.A. §9-9-6 (a). The law governing contract formation applies, which means the issues are generally for the court to determine as a matter of law, as opposed to determining whether there are issues of fact for a jury to consider, like on summary judgment. In this case, the nursing home produced a valid, signed arbitration agreement. Thus, the burden of proof shifted to the plaintiffs to prove that the patient was not competent when she signed it, as opposed to requiring the defense to show that the plaintiff did not have evidence to support their claim.
The case is Kindred Nursing Centers v. Chrzanowski, __ S.E.2d ___ (Ga.Ct.App. September 28, 2016). The panel deciding the case was Presiding Judge Yvette Miller and Judges Christopher McFadden and Carla Wong McMillan.