Judge Michael Shultz, Case Number: 24STCV34651, Date: 2025-05-27 Tentative Ruling

[TENTATIVE] ORDER DENYING PETITION TO COMPEL ARBITRATION AND REQUEST FOR A STAY OF THE ENTIRE ACTION

The complaint alleges that Plaintiffs are the heirs of Alfredo Dator, who was a patient at Defendant’s facility, where he died as a result of Defendant’s alleged negligence. Plaintiffs allege claims for elder abuse/neglect, violation of residents’ rights, negligence, and wrongful death.

Defendant moves to compel arbitration of Plaintiffs’ claims based on an arbitration agreement that was signed by Mr. Dator’s agent and legal representative, Mutya Alvarez[1], who had the authority to sign for Mr. Dator. The arbitration agreement is valid and enforceable under the Federal Arbitration Act (“FAA”). The broad scope of the parties’ agreement includes the claims asserted in Plaintiffs’ complaint. Defendant asks for a stay until the completion of arbitration.

Plaintiffs argue that Defendant did not establish that Daughter had the authority to sign the agreement or waive her father’s right to a jury trial. Defendant’s evidence is insufficient to prove this. Nor has Defendant properly authenticated the signature on the agreement as belonging to Daughter.

Wrongful death claims are not subject to arbitration. The claim belongs to the heirs, who did not sign arbitration agreements. The agreement is procedurally and substantively unconscionable and cannot be enforced.

Daughter was given authority by her father to sign the agreement. Daughter received all the other benefits of the bargain because her father was admitted to Defendant’s facility. Daughter does not deny she signed the agreement. Her ostensible authority binds arbitration of these claims. Her father did not dispute her authority.

Public policy strongly favors arbitration. The agreements are neither procedurally nor substantively unconscionable.

The court “shall” compel arbitration if it determines that an agreement to arbitrate the controversy exists, unless the right to arbitration has been waived or there are grounds for rescission of the agreement. (Code Civ. Proc., § 1281.2.) The petitioner’s burden is to show that a valid arbitration agreement exists. The opposing party’s burden is to demonstrate a defense to enforcement based on a preponderance of evidence. (Molecular Analytical Systems v. Ciphergen Biosystems, Inc. (2010) 186 Cal.App.4th 696, 705.)

Defendant’s burden in moving to compel arbitration is to show the existence of an agreement, not its validity. (Espejo v. Southern California Permanente Medical Group (2016) 246 Cal.App.4th 1047, 1058 ["as a preliminary matter the [trial] court is only required to make a finding of the agreement's existence, not an evidentiary determination of its validity.”]). To meet its burden, the moving party need only attach a copy of the agreement to the petition and incorporate it by reference. (Id. at 1058; Cal. Rules of Court, rule 3.1330 [“The provisions must be stated verbatim or a copy must be physically or electronically attached to the petition and incorporated by reference."].)

Defendant has established the existence of the arbitration agreement. (Mariela Alvarez decl., Ex. A.) Ms. Alvarez declares that she witnessed Daughter sign the agreement at the facility. (Alvarez decl., ¶ 8.) The documents were e-signed. (Id., Exhs. A, B.)

Daughter admits she was at the facility on May 8, 2024, and that she signed admission documents on an electronic pad given to her by Ms. Alvarez. (Mutya Alvarez decl., ¶ 7-8.) Daughter remembers signing the admission documents, but she does not remember signing the separate Arbitration Agreement or the Declaration of Health Care Agent or that the documents were shown to her. (Id. at ¶ 11.) (Mariela Alvarez decl., Ex. B.)

While Daughter may not remember signing the specific documents given the circumstances, she admits signing on an electronic pad. Both the arbitration agreement (Ex. A) and the “Declaration of Health Care Agent” (Ex. B.) were signed on May 8, 2024 between 11:57:53 and 12:48:42. Defendant has established by a preponderance of evidence that Daughter signed the documents while she was at the facility using an electronic pad.

Plaintiffs’ objections 1-3 to Mariela Alvarez’s declaration are overruled. Ms. Alvarez was present at the documents’ signing and has personal knowledge to convey what the parties said. She also witnessed the signing.

B. Defendant has not established that Daughter had the authority to bind Father to arbitrate the claims raised on his behalf which is the elder abuse claim, violation of residents’ rights, and negligence.

Defendant argues that the arbitration agreement is valid because Daughter signed it as an agent/legal representative of Father and was acting pursuant to her “legal authority.” Daughter certified that she was authorized to sign the documents by signing a “Declaration of Health Care Agent” declaring that Daughter is “the authorized agent to make health care decisions for Alfredo Dator.” (Alvarez decl., Ex. 2.) The document acknowledges that Daughter voluntarily signed both the admission and arbitration agreements for her father as her father’s “appointed health care agent.” (Id. at Ex. 2.)

The issue is whether Daughter has the authority to unilaterally agree on behalf of Father to arbitrate claims by fiat given the “Declaration of Health Care Agent.”

Defendant relies on the contention that an actual and ostensible agency relationship existed between Father and Daughter. (Mot. 8-10.) Actual authority exists where the “principal intentionally confers upon the agent, or intentionally, or by want of ordinary care, allows the agent to believe himself to possess.” (Valentine v. Plum Healthcare Group, LLC (2019) 37 Cal.App.5th 1076, 1086 [italics added]; Civ. Code, § 2316.) There is no evidence that Father intentionally appointed Daughter as his agent, or “by want of ordinary care” allowed Daughter to believe she had the authority to act as Father’s agent. Defendant relies on a document wherein Daughter declares herself to be an agent. (Alvarez decl., Ex. B.)

Ostensible authority, on the other hand, "is such as a principal, intentionally or by want of ordinary care, causes or allows a third person to believe the agent to possess." (Civ. Code, § 2317.) Defendant, as the person dealing with the purported agent “must do so with a reasonable belief in the agent's authority, such belief must be generated by some act or neglect by the principal sought to be charged and the person relying on the agent's apparent authority must not be negligent in holding that belief." (Valentine v. Plum Healthcare Group, LLC (2019) 37 Cal.App.5th 1076, 1087.) Defendant does not identify any conduct by the Father that led Defendant to believe Daughter was his agent. Even if Daughter believed she could bind Father to arbitrate claims, this is not enough because “[i]t must be shown that the belief was engendered by conduct of the principal.” (Id.)

Moreover, ostensible agency cannot be established by the representations or conduct of the purported agent; rather “the statements or acts of the principal must be such as to cause the belief the agency exists.” (Id.) Thus in Valentine the court was not persuaded that the purported agent had the authority to act for the principal because he signed on a line marked “resident’s representative” and that also indicated the purported agent had authority to enter into arbitration for the principal. (Valentine at 1087.) Without any evidence of conduct by the principal, an agency relationship is not established.

Plaintiffs’ case authority supports these principles. (Flores v. Evergreen at San Diego, LLC (2007) 148 Cal.App.4th 581, 587–588 [“an agency cannot be created by the conduct of the agent alone; rather, conduct by the principal is essential to create the agency” [emphasis in original.]; Young v. Horizon West, Inc. (2013) 220 Cal.App.4th 1122, 1130 [although the principal testified that her daughter had authority to complete paperwork, the court held the testimony was a “far cry” from authorizing the daughter to forego mother’s right to a jury trial.].)

Moreover, even if the resident did not object to the purported agent’s signing of the arbitration agreements or acquiesced or failed to rescind the arbitration agreement, this is insufficient to establish ostensible agency. (Kinder v. Capistrano Beach Care Center, LLC (2023) 91 Cal.App.5th 804, 816 ["A defendant cannot prove a plaintiff consented to arbitration merely by showing the plaintiff stood idly by while the purported agent signed on his or her behalf.”].)

More recently in Hearden v. Windsor Redding Care Center, LLC (2024) 103 Cal.App.5th 1010, the court determined that “[a]lthough the family signatories signed [the documents] as legal representatives/agents and stated in the agreements that they were authorized to act as decedents’ agents in signing the arbitration agreements, those facts alone do not establish actual or ostensible agency because a person does not become an agent of another merely by unilaterally saying so." (Id. at 1020.)

Defendant’s reply brief does not attempt to distinguish the foregoing line of cases. Nor has Defendant proffered evidence of conduct by Father conferring any authority to Daughter to act as his agent and relinquish his right to a jury trial, or evidence that Defendant believed Daughter to be a designated agent based on anything Father did.

Finally, the remaining claim is the heirs’ individual claims for wrongful death. There is no evidence that Father agreed to arbitrate claims much less bind his relatives to arbitrate wrongful death claims.

Whether the arbitration agreement is unconscionable is superfluous as there is no evidence that Father agreed to arbitrate any claims or disputes in the first instance, given he was not a signatory to the agreement, and Daughter was not his agent.

[1] To avoid confusion, Plaintiff Mutya Alvarez will be referred to as “Daughter.” The decedent, Alfredo Dator, will be referred to as “Father.”