Judge: Michael Small, Case: 23STCV11670, Date: 2024-03-13 Tentative Ruling

Inform the clerk if you submit on the tentative ruling. If moving and opposing parties submit, no appearance is necessary.

Case Number: 23STCV11670    Hearing Date: March 13, 2024    Dept: 57

Plaintiff Wol H. Ahn by and through her daughter and guardian ad litem Sun Hee Ahn sued Defendant Burlington Convalescent Hospital, Inc. (“Burlington)” for negligence, willful misconduct, elder abuse, and violation of patient rights arising out of injuries that Wol allegedly suffered while residing at Burlington.[1]  Pending before the Court is Burlington’s motion to compel arbitration of Wol’s claims under a Resident-Facility Arbitration Agreement (“the Arbitration Agreement”) that Sun Hee signed when Wol was admitted to Burlington.  For the reasons stated below, the Court is denying Burlington’s motion to compel arbitration.  The Court also is advancing to today Burlington’s corresponding motion to stay proceedings in this Court pending resolution of the arbitration and denying that motion as well.[2]

The Arbitration Agreement plainly covers Wol’s claims against Burlington.  The problem for Burlington is that Wol did not sign the Arbitration Agreement herself, and Sun Hee lacked authority to sign the Arbitration Agreement on Wol’s behalf.  Therefore, the Arbitration Agreement is unenforceable against Wol.  Burlington’s arguments to the contrary are unavailing.

First, Burlington argues that a document styled “Statement of Authority to Act on Behalf of Resident” (“Statement of Authority”) shows that Sun Hee was authorized to sign the Arbitration Agreement on Wol’s behalf.  It does not.   The Statement of Authority recites the existence of an agency relationship between the agent/person signing the document, on the one hand, and the resident of Burlington, on the other hand.  But in the blank line at the very top of the Statement of Authority listing who the agent is, Wol’s name is filled in and identified as the agent, not Sun Hee.  The identification of Wol as the agent means that the Statement of Authority does not manifest Sun Hee’s authority to act as an agent on Wol’s behalf.

Second, Burlington points to a form known as a POLST (Physicians Orders For Life Sustaining Treatment) that Sun Hee signed.  It purports to give Sun Hee authority to make certain medical decisions for Wol.  Wol did not sign the POLST herself.  Whether medical providers can honor the POLST in the absence of the patient’s signature on that form is not before the Court.  But even if the answer to that question is yes, the POLST does not demonstrate that Sun Hee had authority to sign the Arbitration Agreement on Wol’s behalf.

Third, Burlington relies on principles governing the ostensible authority of agent to act on behalf of a principal to support its argument that Sun Hee had authority to sign the Arbitration Agreement for Wol.  These principles are of no utility to Burlington.   

Ostensible authority may be found based on “some intentional conduct or neglect on the part of the alleged principal creating a belief in the minds of third persons that an agency exists, and a reasonable reliance thereon by such third persons."  (Flores v. Evergreen at San Diego, LLC (2007) 148 Cal.App.4th 581, 588.)  Burlington’s motion to compel arbitration  is not based on some action of the principal, Wol, creating the belief in the minds of third persons at Burlington that the purported agent, Sun Hee, had authority to act on Wol’s behalf.  Rather, Burlington’s motion is based on the actions of Sun Hee in signing the Arbitration Agreement  and POLST and suggesting to Burlington that she had the authority to act on Wol’s behalf.  But the case law is clear: actions of the purported agent, alone, are insufficient to establish ostensible authority.  (Id. at pp. 587-588.)  Flores is particularly instructive because the Court of Appeal in that case applied ostensible authority principles in affirming an order denying a motion to compel arbitration of the plaintiff’s claims against a skilled nursing facility.  The purported agent in Flores, who was the plaintiff’s husband, signed the arbitration agreement in question.  (Flores, supra, 148 Cal.App.4th at p.585.)  The Court of Appeal held that (1) there was no evidence of any action of the plaintiff that would give third parties the impression that the husband had ostensible authority to bind the plaintiff to the arbitration agreement, and (2) the actions of plaintiff’s husband in signing the agreement and, according to the defendant, acting as if he was the plaintiff’s agent, was insufficient to support the proposition that the husband had ostensible authority to bind the plaintiff to it.  (Id. at pp. 588-589.)  Pagarigan v. Libby Care Center, Inc. (2002) 99 Cal.App.4th 298, parallels Flores.  Like in Flores, the Court of Appeal in Pagarigan affirmed an order denying a motion to compel to arbitration of the plaintiff’s claims against a skilled nursing facility.  And like in Flores, the motion to compel arbitration in Pagarigan was based on the supposition that the plaintiff’s family members who signed the arbitration agreement in question had ostensible authority to bind the plaintiff to the agreement because of the family’s actions that created an impression in the minds of the facility that they had that authority.  The Court of Appeal rejected that supposition on the ground that the plaintiff  herself had not taken any actions that would give the facility the impression that her family members had ostensible authority to act on her behalf.  (Id. at pp. 300-302.) 

 Finally, it bears noting that Burlington does not argue that Sun Hee had authority to sign the Arbitration Agreement on Wol’s behalf through a power of attorney that Wol executed.  Nor could Burlington make such an argument.  That is because a document submitted along with the motion to compel arbitration that is styled “Resident Agent Information” states flat out that Sun Hee does not have a power of attorney to act on Wol’s behalf.  To be sure, Sun Hee is Wol’s guardian ad litem.  But Sun Hee was appointed guardian ad litem in connection with the filing of the lawsuit against Burlington.  Sun Hee was not Wol’s guardian ad litem when Wol was admitted to Burlington.