Yazedjian v. Arc Santa Catalina Inc.

JEANNETTE YAZEDJIAN, PERSONAL REPRESENTATIVE OF THE ESTATE OF HARRIETTE PATTERSON,ON BEHALF OF THE ESTATE OF HARRIETTE PATTERSON, DECEASED;AND JEANNETTE YAZEDJIAN, INDIVIDUALLYAND ON BEHALF OF HARRIETTE PATTERSON'S STATUTORY BENEFICIARIESPURSUANT TO A.R.S. § 12-612(A), Plaintiff/Appellee, v. ARC SANTA CATALINA INC., A TENNESSEE CORPORATION,DBA LA ROSA HEALTH CARE CENTER AT SANTA CATALINA VILLAS;AMERICAN RETIREMENT CORPORATION, A TENNESSEE CORPORATION;BROOKDALE SENIOR LIVING COMMUNITIES INC., A DELAWARE CORPORATION;BROOKDALE SENIOR LIVING INC., A DELAWARE CORPORATION;AND RICHARD W. PARK, ADMINISTRATOR, Defendants/Appellants.

No. 2 CA-CV 2017-0045

ARIZONA COURT OF APPEALS DIVISION TWO

January 29, 2018

THIS DECISION DOES NOT CREATE LEGAL PRECEDENT AND MAY NOT BE CITED EXCEPT AS AUTHORIZED BY APPLICABLE RULES.

NOT FOR PUBLICATION

See Ariz. R. Sup. Ct. 111(c)(1); Ariz. R. Civ. App. P. 28(a)(1), (f).

Appeal from the Superior Court in Pima County

No. C20152591

The Honorable Leslie Miller, Judge

AFFIRMED

COUNSEL

Law Office of Scott E. Boehm, P.C., Phoenix

By Scott E. Boehm

and

Wilkes & McHugh, P.A., Scottsdale

By Melanie L. Bossie and Mary Ellen Spiece

Counsel for Plaintiff/Appellee

Quintairos, Prieto, Wood & Boyer, P.A., Phoenix

By Anthony J. Fernandez, Vincent J. Montell, and Rita J. Bustos

Counsel for Defendants/Appellants

MEMORANDUM DECISION

Presiding Judge Vásquez authored the decision of the Court, in which Judge Espinosa and Judge Eppich concurred.

VÁSQUEZ, Presiding Judge:

¶1 ARC Santa Catalina Inc., doing business as La Rosa Health Care Center at Santa Catalina Villas; American Retirement Corporation; Brookdale Senior Living Communities Inc.; Brookdale Senior Living Inc.; and Richard W. Park (collectively "La Rosa") appeal from the trial court's order denying both its motion to compel arbitration of a claim brought under the Adult Protective Services Act (APSA) by Jeannette Yazedjian as personal representative of the Estate of Harriette Patterson and on behalf of the decedent's statutory beneficiaries, and a subsequent motion to reconsider that denial. On appeal, La Rosa argues that the arbitration agreement signed by Yazedjian is enforceable because she was authorized to sign it on Patterson's behalf. For the following reasons, we affirm.

Factual and Procedural Background

¶2 We view the facts in the light most favorable to upholding the trial court's order.¹ Escareno v. Kindred Nursing Ctrs. W., L.L.C., 239 Ariz.126, ¶ 2 (App. 2016). Before the fall of 2009, Patterson lived in a senior living center called Amber Lights. Her husband preceded her in death, and she had no children. Her only living relative was her brother, Roger Rogers, who resided in Florida and had difficulty traveling due to his own and his wife's health problems. As Patterson's health deteriorated, and because she lacked any nearby family, her healthcare was coordinated and facilitated by a local company called Caring Cooperatives.

¶3 Yazedjian is an attorney based and licensed in California. In 2006 or 2007, Rogers contacted Yazedjian's office, seeking help on Patterson's behalf with some "tax issues."² Yazedjian assisted Patterson on those issues, and soon thereafter also undertook estate-planning matters and established a "client trust fund" for Patterson. She also assisted with Patterson's finances and ensured that her "bills were paid and that her financial needs were being met." Rogers and Caring Cooperatives kept Yazedjian informed of Patterson's health, but she was not involved in making any healthcare decisions for Patterson.

¶4 In 2009, Patterson's health declined further, and, in June, she was diagnosed with "moderate to severe deficits in cognition" and dementia. Both Amber Lights and Caring Cooperatives recommended moving her to a facility more capable of meeting her needs.

¶5 Patterson was admitted to La Rosa in October 2009. Yazedjian signed the admission paperwork. That paperwork included a "Binding Arbitration Agreement," which provided, in part: "[C]laims, controversies, disputes, or tort action arising out of or relating in any manner to the treatment or delivery of services by us to you during your stay at [La Rosa], shall be submitted to binding arbitration, which shall be conducted as provided in this Agreement." It additionally provided, "If you choose not to enter into this Agreement, you will not be denied residency for thatreason alone." Yazedjian signed the agreement and, next to her signature, added "on behalf of Harriette Patterson."

¶6 Patterson died in May 2014. The following year, Yazedjian, as Patterson's personal representative, filed this civil lawsuit against La Rosa alleging negligence, APSA violations, and wrongful-death claims. La Rosa filed a motion to compel arbitration of the APSA claim pursuant to the arbitration agreement. Yazedjian's arguments in response included that she lacked authority to sign the agreement on Patterson's behalf and it was therefore unenforceable. Following a hearing, the trial court denied La Rosa's motion in an unsigned order, finding Yazedjian "lacked the authority to sign the agreement to arbitrate."

¶7 The case progressed, and both parties began discovery. La Rosa later filed a motion for reconsideration of the denial of its motion to compel arbitration based on newly discovered evidence relevant to Yazedjian's authority as Patterson's agent; specifically, that Yazedjian and Patterson had an attorney-client relationship beginning in 2007, which, it contended, was not limited in scope. It thus argued that Patterson had "provided actual express authority for . . . Yazedjian to act on her behalf when she hired her as an attorney." It further asserted that Yazedjian also had "actual implied authority" based on her "history of acting as Harriette Patterson's agent prior to her admission to La Rosa."

¶8 Yazedjian responded that her scope of representation was limited to tax issues and estate planning and did not encompass authority to bind Patterson to an arbitration agreement. She further argued there was no evidence she had acted as Patterson's general agent before her admission to La Rosa and, thus, had no implied authority. The trial court denied La Rosa's motion, again in an unsigned order, finding it had "provide[d] no evidence that . . . Yazedjian had Power of Attorney that permitted her to sign the Agreement in question on [Patterson's] behalf and waive her right to litigation." Pursuant to the parties' stipulation, the court entered a final, signed order denying La Rosa's motion to compel arbitration and its motion to reconsider. This appeal followed. We have jurisdiction pursuant to A.R.S. § 12-2101.01(A)(1). See Brumett v. MGA Home Healthcare, L.L.C., 240 Ariz. 420, ¶¶ 11, 26 (App. 2016).

Discussion

¶9 La Rosa argues the trial court erred by denying its motion to compel arbitration and its motion to reconsider that denial becauseYazedjian had actual authority to sign the arbitration agreement.³ The existence of agency is generally a question of fact. Escareno, 239 Ariz. 126, ¶ 6. But because the parties do not dispute the material facts, we review de novo whether such a relationship existed. See id.

¶10 Although arbitration agreements cover a specific topic—an agreement to arbitrate certain disputes—they are a form of contract and consequently "subject to the same defenses to enforceability as any other contract." Duenas v. Life Care Ctrs. of Am., Inc., 236 Ariz. 130, ¶ 6 (App. 2014); see A.R.S. § 12-3006(A) (arbitration agreements "valid, enforceable and irrevocable except on a ground that exists at law or in equity for the revocation of a contract"); see also Kindred Nursing Ctrs. Ltd. P'ship v. Clark, ___ U.S. ___, ___, 137 S. Ct. 1421, 1424 (2017) (arbitration agreements "on equal footing with all other contracts"), quoting DIRECTV, Inc. v. Imburgia, ___ U.S. ___, ___, 136 S. Ct. 463, 465 (2015). A defendant seeking to enforce a contract must show the plaintiff accepted the terms of the agreement. See Escareno, 239 Ariz. 126, ¶ 7; see also Goodman v. Physical Res. Eng'g, Inc., 229 Ariz. 25, ¶ 7 (App. 2011) ("For a valid contract to have been formed between them, there must have been an offer, acceptance of the offer, and consideration . . . ."). Or, as relevant here, that the person who signed the contract was "in fact . . . the plaintiff's agent and, thus, had authority to do so." Escareno, 239 Ariz. 126, ¶ 7; see Goodman, 229 Ariz. 25, ¶ 11.¶11 "Actual authority 'may be proved by direct evidence of express contract of agency between the principal and agent or by proof of facts implying such contract or the ratification thereof.'" Ruesga v. Kindred Nursing Ctrs., L.L.C., 215 Ariz. 589, ¶ 29 (App. 2007), quoting Corral v. Fid. Bankers Life Ins. Co., 129 Ariz. 323, 326 (App. 1981). This "includes both express authority outlined in specific language, and implied authority when the agent acts consistently with the agent's 'reasonable interpretation of the principal's manifestation in light of the principal's objective and other facts known to the agent.'" Best Choice Fund, LLC v. Low & Childers, P.C., 228 Ariz. 502, ¶ 26 (App. 2011), quoting Ruesga, 215 Ariz. 589, ¶ 29.

¶12 We find Escareno particularly instructive. In that case, the decedent's son had signed an arbitration agreement on his mother's behalf when she was admitted to an assisted-living facility. 239 Ariz. 126, ¶¶ 2-3. At that time, his mother suffered from "encephalopathy, cognitive deficits, and a 'severe case of dementia.'" Id. ¶ 2. The undisputed evidence in this case similarly demonstrates that Patterson likely was unaware Yazedjian had signed the arbitration agreement and was incapable of understanding Yazedjian's actions in such a way as to either give her consent or contest them. As we noted above, Patterson was diagnosed with "moderate to severe deficits in cognition" and dementia prior to her admission at La Rosa.

¶13 Moreover, Yazedjian testified that Patterson did not want to leave Amber Lights, and she and Caring...