PORTFOLIO ONE, LLC D/B/A/ MANORCARE HEALTH SERVICES-WASHINGTON TOWNSHIP et al v. JOIE et al
Filing
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OPINION. Signed by Judge Joseph H. Rodriguez on 1/23/2019. (rtm, )
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
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PORTFOLIO ONE, LLC, et al.,
Plaintiffs,
v.
GINA M. JOIE, et al.,
Defendants.
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Hon. Joseph H. Rodriguez
Civil Action No. 17-579
OPINION
This matter is before the Court on cross-motions for summary
judgment on the issue of whether the parties should be compelled to
arbitrate their case of nursing home neglect. Having considered the parties’
submissions, the Court decides this matter without oral argument pursuant
to Federal Rule of Civil Procedure 78. For the reasons stated below, this
Court denies Defendants’ motion for summary judgment and grants
Plaintiffs’ cross-motion for summary judgment.
Background
Plaintiffs Portfolio One, LLC d/b/a ManorCare Health ServicesWashington Township, HCR ManorCare, Inc., and ManorCare Health
Services, LLC filed a Complaint before this Court to compel arbitration of a
dispute with Defendants Gina M. Joie and Danielle N. Griffith, executors of
the estate of their father, John T. Bombara, who had been a patient in
Plaintiffs’ facility when he passed away on July 7, 2014.
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On February 24, 2013, Defendant Danielle N. Griffith signed a
document titled Voluntary Arbitration Agreement (“Agreement”) on behalf
of decedent John T. Bombara with respect to decedent’s admission to the
Plaintiffs’ licensed skilled-nursing facility. At that time, Griffith held a
General Durable Power of Attorney executed by her father in 2011,
authorizing her to “defend, settle, adjust, compound, submit to arbitration
and compromise all actions, suits, accounts, reckonings, claims and
demands whatsoever that are now, or hereafter shall be, pending between
[her father] and any person, firm, association or corporation, in such
manner and in all respects as [Griffith] shall think fit[.]”
The top of the first page of the Agreement stated, in bold, capitalized
lettering:
THE PARTIES ARE WAIVING THEIR RIGHT TO A
TRIAL BEFORE A JUDGE OR JURY OF ANY DISPUTE
BETWEEN THEM. PLEASE READ CAREFULLY
BEFORE SIGNING. THE PATIENT WILL RECEIVE
SERVICES IN THIS CENTER WHETHER OR NOT THIS
AGREEMENT IS SIGNED. ARBITRATION IS
DESCRIBED IN THE VOLUNTARY ARBITRATION
PROGRAM BROCHURE COPY, ATTACHED AND
MADE PART OF THIS AGREEMENT.
Paragraph 1 of the Agreement provides, in relevant part:
1. Agreement to Arbitrate “Disputes”: All claims arising
out of or relating to this Agreement, the Admission Agreement
or any and all past or future admissions of the Patient at this
Center, or any sister Center operated by any subsidiary of HCR
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ManorCare, Inc. (“Sister Center”), including claims for
malpractice, shall be submitted to arbitration.
Paragraph 3 of the Agreement states, in relevant part, that the
“Parties agree and intend that this Agreement, the Admission Agreement,
and the Patient’s stays at the Center substantially involve interstate
commerce, and stipulate that the Federal Arbitration Act (“FAA”) and
applicable federal case law apply to this Agreement, [and] preempt any
inconsistent State law[.]” Paragraph 5 of the Agreement states:
5. Sole Decision Maker: Except as otherwise provided in 6
below, the [Arbitration] Panel is empowered to, and shall,
resolve all disputes, including without limitation, any disputes
about the making, validity, enforceability, scope, interpretation,
voidability, unconscionability, preemption, severability, and/or
waiver of this Agreement or the Admission Agreement, as well
as resolve the Parties’ underlying disputes, as it is the Parties’
intent to avoid involving the court system.
Paragraph 8 of the Agreement allows the signatory to cancel the Agreement
within thirty (30) days of signing by sending written notice via certified
mail. Paragraph 8 also states “[i]f not cancelled, this Agreement shall be
binding on the Patient for this and all of Patient’s subsequent admissions to
the Center or any Sister Center without any need for further renewal.”
Immediately preceding the signature block of the Agreement, the
following text appears:
THE PARTIES CONFIRM THAT EACH OF THEM
UNDERSTANDS THAT EACH HAS WAIVED THE
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RIGHT TO A TRIAL BEFORE A JUDGE OR JURY AND
THAT EACH CONSENTS TO ALL OF THE TERMS OF
THIS VOLUNTARY AGREEMENT. PATIENT
ACKNOWLEDGES THE RIGHT TO REVIEW THIS
AGREEMENT WITH AN ATTORNEY OR FAMILY
BEFORE SIGNING.
Beneath that text, Plaintiff, Danielle N. Griffith, signed her name in the
space designated for the “Patient’s Legal Representative[.]”
Defendants initiated a State court action on or about October 5, 2015
by filing a Complaint in a case captioned Gina M. Joie and Danielle N.
Griffith, General Executors and Executors Ad Prosequendum of the Estate
of John T. Bombara v. ManorCare Health Services-Washington
Township, HCR ManorCare, Inc., ManorCare Health Services, Portfolio
One, LLC, and Anthony Stinson, Administrator in the Superior Court of
New Jersey, Law Division, Gloucester County, Docket No.: GLO-L-1375-15
(“State court action”). Defendants subsequently filed an Amended
Complaint in the State court action on April 29, 2016.
On January 27, 2017, Plaintiffs filed the Complaint in this Court to
compel arbitration of the dispute. On September 21, 2017, the Court
granted limited discovery on the issue of arbitrability. Subsequent to such
discovery, the parties filed cross-motions for summary judgment that are
presently before the Court.
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Applicable Standard
“Summary judgment is proper if there is no genuine issue of material
fact and if, viewing the facts in the light most favorable to the non-moving
party, the moving party is entitled to judgment as a matter of law.” Pearson
v. Component Tech. Corp., 247 F.3d 471, 482 n.1 (3d Cir. 2001) (citing
Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)); accord Fed. R. Civ. P.
56 (a). Thus, the Court will enter summary judgment in favor of a movant
who shows that it is entitled to judgment as a matter of law, and supports
the showing that there is no genuine dispute as to any material fact by
“citing to particular parts of materials in the record, including depositions,
documents, electronically stored information, affidavits or declarations,
stipulations . . . admissions, interrogatory answers, or other materials.”
Fed. R. Civ. P. 56 (c)(1)(A).
An issue is “genuine” if supported by evidence such that a reasonable
jury could return a verdict in the nonmoving party’s favor. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A fact is “material” if, under
the governing substantive law, a dispute about the fact might affect the
outcome of the suit. Id. In determining whether a genuine issue of material
fact exists, the court must view the facts and all reasonable inferences
drawn from those facts in the light most favorable to the nonmoving party.
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Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587
(1986).
Initially, the moving party has the burden of demonstrating the
absence of a genuine issue of material fact. Celotex, 477 U.S. at 323. Once
the moving party has met this burden, the nonmoving party must identify,
by affidavits or otherwise, specific facts showing that there is a genuine
issue for trial. Id.; Maidenbaum v. Bally’s Park Place, Inc., 870 F. Supp.
1254, 1258 (D.N.J. 1994). Thus, to withstand a properly supported motion
for summary judgment, the nonmoving party must identify specific facts
and affirmative evidence that contradict those offered by the moving party.
Anderson, 477 U.S. at 256-57. “A nonmoving party may not ‘rest upon mere
allegations, general denials or . . . vague statements . . . .’” Trap Rock
Indus., Inc. v. Local 825, Int’l Union of Operating Eng’rs, 982 F.2d 884,
890 (3d Cir. 1992) (quoting Quiroga v. Hasbro, Inc., 934 F.2d 497, 500 (3d
Cir. 1991)). Indeed,
the plain language of Rule 56(c) mandates the entry of
summary judgment, after adequate time for discovery and
upon motion, against a party who fails to make a showing
sufficient to establish the existence of an element essential
to that party’s case, and on which that party will bear the
burden of proof at trial.
Celotex, 477 U.S. at 322. That is, the movant can support the assertion that
a fact cannot be genuinely disputed by showing that “an adverse party
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cannot produce admissible evidence to support the [alleged dispute of]
fact.” Fed. R. Civ. P. 56(c)(1)(B); accord Fed. R. Civ. P. 56(c)(2).
In deciding the merits of a party’s motion for summary judgment, the
court’s role is not to evaluate the evidence and decide the truth of the
matter, but to determine whether there is a genuine issue for trial.
Anderson, 477 U.S. at 249. Credibility determinations are the province of
the factfinder. Big Apple BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358,
1363 (3d Cir. 1992).
Discussion
A mandatory arbitration provision in a nursing home or assisted
living facility agreement is generally enforceable. See Marmet Health Care
Ctr., Inc. v. Brown, 565 U.S. 530, 532-33 (2012). Because nursing home
agreements involve interstate commerce, arbitration provisions contained
therein are governed by the Federal Arbitration Act, 9 U.S.C. § 2 (“FAA”);
thus, the FAA preempts the anti-arbitration provision contained in N.J.
Stat. Ann. § 30:13-8.1. Estate of Ruszala v. Brookdale Living Communities,
Inc., 1 A.3d 806, 817-18 (N.J. Super. Ct. App. Div. 2010).
Before compelling arbitration, however, courts must be satisfied that
the parties have an agreement to arbitrate, because “arbitration is a matter
of contract and a party cannot be required to submit to arbitration any
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dispute which he has not agreed so to submit.” AT & T Techs., Inc. v.
Commc’ns Workers of Am., 475 U.S. 643, 648 (1986) (citations omitted).
The Court must decide, first, whether “there is an agreement to arbitrate”
and, second, whether “the dispute at issue falls within the scope of that
agreement.” Century Indem. Co. v. Certain Underwriters at Lloyd’s,
London, subscribing to Retrocessional Agreement Nos. 950548, 950549, &
950646, 584 F.3d 513, 523 (3d Cir. 2009). When the parties have a valid
arbitration agreement, “any doubts concerning the scope of arbitrable
issues should be resolved in favor of arbitration[.]” Mitsubishi Motors
Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 626 (1985) (citation
omitted).
General State law principles are utilized to determine whether the
parties have agreed to arbitrate. Aliments Krispy Kernels, Inc. v. Nichols
Farms, 851 F.3d 283, 289 (3d Cir. 2017). Here, the parties acknowledge
that New Jersey law determines whether there was an agreement to
arbitrate. Under New Jersey contract principles, “[a]n enforceable
agreement requires mutual assent, a meeting of the minds based on a
common understanding of the contract terms.” Morgan v. Sanford Brown
Inst., 137 A.3d 1168, 1180 (N.J. 2016). “[A]ny contractual waiver-of-rights
provision must reflect that the party has agreed clearly and unambiguously
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to its terms.” Atalese v. U.S. Legal Servs. Grp., L.P., 99 A.3d 306, 313 (N.J.
2014) (internal quotation and citation omitted). “No particular form of
words is necessary to accomplish a clear and unambiguous waiver of
rights.” Atalese, 99 A.3d at 314. “Whatever words compose an arbitration
agreement, they must be clear and unambiguous that a [party] is choosing
to arbitrate disputes rather than have them resolved in a court of law. In
this way, the agreement will assure reasonable notice to the [party].” Id. at
316. “The point is to assure that the parties know that in electing arbitration
as the exclusive remedy, they are waiving their time-honored right to
sue.” Id. at 314 (citation omitted). “[A]n arbitration agreement is clearly
enforceable when its terms affirmatively state, or unambiguously convey to
a consumer in a way that he or she would understand, that there is a
distinction between agreeing to resolve a dispute in arbitration and in a
judicial forum.” Kernahan v. Home Warranty Adm’r of Fla., Inc., --- A.3d --, 2019 WL 166309, at *11 (N.J. Jan. 10, 2019) (citing Atalese, 99 A.3d at
313).
The FAA requires that courts place arbitration agreements “on equal
footing with all other contracts.” Kindred Nursing Ctrs. Ltd. P’ship v.
Clark, 581 U.S. ---, 137 S. Ct. 1421, 1424 (2017). “When a party enters into a
signed, written contract, that party is presumed to understand and assent
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to its terms, unless fraudulent conduct is suspected.” Stelluti v. Casapenn
Enters., LLC, 1 A.3d 678, 690 (N.J. 2010). “Failing to read a contract does
not excuse performance unless fraud or misconduct by the other party
prevented one from reading.” Gras v. Assocs. First Capital Corp., 786 A.2d
886, 894 (N.J. Super. Ct. App. Div. 2001) (citation omitted); see
also Henningsen v. Bloomfield Motors, Inc., 161 A.2d 69, 84 (N.J. 1960)
(describing same as a “general principle” of contract law).
Here, Defendants assert that the Voluntary Arbitration Program
Brochure referenced in the February 24, 2013 Agreement signed by Griffith
was not produced until December 21, 2016, after the State court action was
filed and outside of the statute of limitations for the State court action.
Further, Defendants take issue with the fact that Mr. Bombara is not
referenced in the document Griffith signed. Finally, Defendants contend
that the document signed by Griffith on February 24, 2013 was in reference
to Bombara’s January 28, 2013 admission and did not pertain to his May
29, 2014 admission that is the subject of the dispute between the parties.
Defendants argue that this combination of circumstances indicates that the
parties did not come to a meeting of the minds to support the formation of
a contract to arbitrate.
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The Court finds that the Agreement signed by Ms. Griffith contains
“plain language that would be clear and understandable to the average
consumer that she is waiving . . . rights . . . to sue or go to court to secure
relief . . . giving up her right to bring her claims in court or have a jury
resolve the dispute.” Atalese, 99 A.3d at 315-16. Further, the claims in
dispute fall within the scope of the Agreement because the Agreement
requires the parties to arbitrate “any dispute.” Alamo Rent A Car, Inc. v.
Galarza, 703 A.2d 961, 966 (N.J. Super. Ct. App. Div. 1997) (“The ‘any
dispute’ language is the very least . . . need[ed] . . . to guarantee arbitration
of all disputes.”). Accord Martindale v. Sandvik, Inc., 800 A.2d 872, 88384 (N.J. 2002).
Regarding the Arbitration Program brochure, “if parties agree on
essential terms and manifest an intention to be bound by those terms, they
have created an enforceable contract.” Weichert Co. Realtors v. Ryan, 608
A.2d 280, 284 (N.J. 1992). The essential terms of the agreement to
arbitrate were contained in the Agreement signed by Griffith on February
24, 2013; the brochure was a supplement that did not differ from or
contradict the terms in the Agreement.
Finally, any reference Defendants have made to the New Jersey
Consumer Fraud Act, N.J. Stat. Ann. § 56:8-2.22, is misplaced because that
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statute is inapplicable to skilled nursing facilities under the “learned
professionals” exception. See Manahawkin Convalescent v. O’Neill, 43
A.3d 1197, 1203 (N.J. Super. Ct. App. Div. 2012).
Conclusion
For these reasons, Plaintiffs’ motion for summary judgment to
compel arbitration will be granted; Defendants’ motion will be denied. An
Order consistent with this Opinion follows.
Dated: January 23, 2019
/s/ Joseph H. Rodriguez
JOSEPH H. RODRIGUEZ
UNITED STATES DISTRICT JUDGE
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