Court Finds Nursing Home Waived Its Right to Arbitration Despite Signed Arbitration Clause

Businesses are smart and often will do anything to avoid litigation. Many businesses now include an arbitration clause in their contracts—requiring claims to be resolved out of court. However, in a recent case, a state’s supreme court found that even though a contract included an arbitration clause, it would not be enforced because the business waived its right to arbitration.

A woman placed her mother in a nursing home. When she enrolled her mother, she signed an arbitration agreement with the home. Later, she requested access to her mother’s medical records. The nursing home refused, citing privacy laws. The two parties continued the dispute in court. Two years later, her mother passed away.

After her mother’s death, the woman filed a notice of intention to file a wrongful death action against the nursing home. The nursing home asserted arbitration as a defense but did not require that the case be moved to arbitration at that time. Instead, it continued with the case in court, including appearing in court several times and responding to discovery. The plaintiff responded that the home had waived its right to arbitration because it had never requested arbitration during her case requesting her mother’s records. Soon afterward, the home argued that the case had to be moved to arbitration. The plaintiff argued that the home waived its right to arbitration by participating in discovery and appearing multiple times in court.

That state’s supreme court found that the nursing home did in fact waive its right to arbitration, despite its arbitration clause. The court stated that the nursing home ignored the plaintiff’s request for discovery, while requesting discovery from the plaintiff. This caused her to incur more litigation expenses by responding to the home’s discovery and preparing for litigation. The nursing home waited eight months before filing its motion to compel arbitration and continued to participate in the case, and thus it waived its right to arbitration.

Arbitration in Illinois

Arbitration is an alternative to litigation that allows the parties to have another person (an arbitrator) make a decision in the case. The process allows parties to avoid court by using an arbitrator, who is agreed on by both parties. They can also go to an arbitration panel, with each side choosing an arbitrator and a third person agreed on by the other two arbitrators. Some contracts include an arbitration clause.

Some arbitration clauses make arbitration mandatory, making arbitration a requirement for resolution. Other clauses are voluntary, providing that it is an option if both sides agree after evaluating the options. In Illinois, certain civil actions are required to be resolved in arbitration in order to speed up the process. It is also more cost-effective. For example, arbitration often takes place in cases involving $50,000 or less. It generally occurs in front of a three-lawyer panel.

Parties can still be represented by an attorney in arbitration hearings. An attorney can still argue your case in front of an arbitrator.

Have You Signed a Contract with an Arbitration Clause?

If you signed a contract with an arbitration clause in it, it may not be enforceable if the other party waives its right to arbitration. It may be unenforceable for a number of other reasons, especially if it was signed by the wrong party. Even if it is enforceable, you still need a dedicated nursing home negligence attorney in your corner. Your case still needs to be investigated, researched, and argued under the relevant legal requirements. The Chicago attorneys at Moll Law Group can help you explore the scope of your options. We represent people in Naperville, Schaumburg, and Wheaton, as well as communities across Cook County. Use our online form to schedule a free consultation, or call us at 312-462-1700.

See More Posts:

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Evidence of Lack of Insurance Determined Irrelevant in Car Accident Claim, Illinois Injury Lawyer Blog, April 30, 2016.

Woman Injured by Hot Air Balloon While Standing in Line Permitted to Sue Despite Signed Waiver, Illinois Injury Lawyer Blog, May 11, 2016.