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Davis v. Center Management Group, LLC

Superior Court of Pennsylvania

June 28, 2018

BRENDA DAVIS, ADMINISTRATRIX OF THE ESTATE OF RUTH ROBERTS, DECEASED,
v.
CENTER MANAGEMENT GROUP, LLC, 10400 ROOSEVELT OPERATING, LLC D/B/A ST. JOHN NEUMANN CENTER FOR REHABILITATION AND HEALTHCARE, CATHOLIC HEALTH SERVICES, LLC, 10400 ROOSEVELT INVESTMENTS, LLC, 10400 ROOSEVELT LIC, LLC, 10400 ROOSEVELT LOT, LLC, 10400 ROOSEVELT PARTNERS LLC, 10400 ROOSEVELT REALTY, LLC, 10400 ROOSEVELT VENTURES, LLC, CHARLES-EDOUARD GROS, MOSHE ROSENBERG, CAROLYN BOEHM, ST. JOHN NEUMANN NURSING HOME, AND ARCHDIOCESE OF PHILADELPHIA D/B/A CATHOLIC HEALTH CARE SERVICES, BRENDA DAVIS, ADMINISTRATRIX OF THE ESTATE OF RUTH ROBERTS, DECEASED,
v.
GERMANTOWN HOME AND NEW COURTLAND ELDER SERVICES, INC., APPEAL OF: ARCHDIOCESE OF PHILADELPHIA D/B/A CATHOLIC HEALTH CARE SERVICES AND ST. JOHN NEUMANN NURSING HOME BRENDA DAVIS, ADMINISTRATRIX OF THE ESTATE OF RUTH ROBERTS, DECEASED,
v.
GERMANTOWN HOME AND NEW COURTLAND ELDER SERVICES, INC., BRENDA DAVIS, ADMINISTRATRIX OF THE ESTATE OF RUTH ROBERTS, DECEASED,
v.
CENTER MANAGEMENT GROUP, LLC, 10400 ROOSEVELT OPERATING, LLC D/B/A ST. JOHN NEUMANN CENTER FOR REHABILITATION AND HEALTHCARE, CATHOLIC HEALTH SERVICES, LLC, 10400 ROOSEVELT INVESTMENTS, LLC, 10400 ROOSEVEL LIC, LLC, 10400 ROOSEVELT LOT, LLC, 10400 ROOSEVELT PARTNERS LLC, 10400 ROOSEVELT REALTY, LLC, 10400 ROOSEVELT VENTURES, LLC, CHARLES-EDOUARD GROS, MOSHE ROSENBERG, CAROLYN BOEHM, ST. JOHN NEUMANN NURSING HOME, AND ARCHDIOCESE OF PHILADELPHIA D/B/A CATHOLIC HEALTH CARE SERVICES, APPEAL OF: CENTER MANAGEMENT GROUP, LLC, 10400 ROOSEVELT OPERATING, LLC D/B/A ST. JOHN NEUMANN CENTER FOR REHABILITATION AND HEALTHCARE, CATHOLIC HEALTH SERVICES, LLC, 10400 ROOSEVELT REALTY, LLC, 10400 ROOSEVELT LOT, LLC, CHARLES-EDOUARD GROS, MOSHE ROSENBERG, AND CAROLYN BOEHM

          Appeal from the Order January 24, 2017 in the Court of Common Pleas of Philadelphia County Civil Division at No(s): July Term, 2016 No. 00108 November Term, 2015 No. 03740

          BEFORE: PANELLA, LAZARUS, and STRASSBURGER, [*] JJ.

          OPINION

          STRASSBURGER, J.

         In these consolidated appeals, Archdiocese of Philadelphia d/b/a Catholic Health Care Services and St. John Neumann Nursing Home (collectively, AOP) and Center Management Group, LLC, 10400 Roosevelt Operating LLC d/b/a St. John Neumann Center for Rehabilitation and Healthcare, Catholic Health Services, LLC, 10400 Roosevelt Realty, LLC, 10400 Roosevelt Lot, LLC, Charles-Edouard Gros, Moshe Rosenberg, and Carolyn Boehm (collectively, CMG)[1] appeal from the January 24, 2017 orders overruling their respective preliminary objections in the nature of a petition to compel arbitration.[2] We vacate the orders and remand for proceedings consistent with this opinion.

         Decedent passed away on October 31, 2015. This action involves claims of negligence relating to care rendered to Decedent during her stay in 2014 and 2015 as a patient at a skilled nursing facility, St. John Neumann Nursing Home (St. John Neumann), which was owned and operated first by AOP, and later, by CMG.

         Decedent was admitted to St. John Neumann on May 5, 2014. She remained there until she was hospitalized for several weeks in March 2015. On April 3, 2015, Decedent was re-admitted to St. John Neumann. Upon Decedent's re-admission to St. John Neumann, Decedent's daughter, Davis, signed an agreement relating to Decedent's stay at St. John Neumann (Admission Agreement) which, inter alia, details the nature of the services provided and the resident's financial obligations.[3] Prior to Davis's signing of the Admission Agreement, Decedent had granted Davis certain powers pursuant to a written general durable power of attorney dated February 25, 2015(Power of Attorney).[4]

         The Admission Agreement purports to make the following parties to the agreement: St. John Neumann, Decedent (known in the agreement as "Resident"), and Davis as Decedent's "legal representative," (known in the agreement as "Responsible Person"). Admission Agreement, 4/3/2015, at 1. Decedent did not sign the Admission Agreement. Davis signed on the line designated for Decedent's "Responsible Person."[5]

         Relevant to this appeal, the Admission Agreement contains an arbitration clause (Arbitration Clause), which requires the parties to submit to arbitration all disputes relating to the Admission Agreement, with the exception of guardianship proceedings and disputes involving amounts in controversy less than $8, 000. Id. at 16-20. The Arbitration Clause indicates specifically that it applies to disputes relating to personal injury or medical malpractice. Id. at 18.

         On July 5, 2016, Davis, in her capacity as administratrix of Decedent's estate, filed a praecipe for a writ of summons against Appellants. The writ of summons was issued and served upon Appellants. On November 9, 2016, Appellants filed a joint petition to compel arbitration, which alleged that Decedent's estate was bound to arbitrate any disputes pursuant to the Arbitration Clause. Davis filed an answer to the petition to compel on November 29, 2016, arguing that the case should remain in the court of common pleas. The following day, Davis filed a complaint against Appellants, alleging various negligence claims relating to the care Decedent received while at St. John Neumann.

         On December 6, 2016, the trial court denied Appellants' petition to compel without prejudice, holding that Appellants could not petition the court to compel arbitration in response to a writ of summons. Trial Court Order, 12/6/2016, at 1 ("A plaintiff must first file a formal [c]omplaint, after which a defendant may move to compel arbitration following the procedures set forth in Pa.R.C.P. 1028.").[6] The court further specified that "[Appellants] shall have [20] days from the date of this order to file a [p]etition in response to [Davis's] formal [c]omplaint." Id.

         Appellants each filed preliminary objections to the complaint on December 27, 2016. Inter alia, the preliminary objections were filed in the nature of a petition to compel arbitration pursuant to Pa.R.C.P. 1028(a)(6), and sought to enforce the Arbitration Clause in the Admission Agreement. Davis filed responses in opposition to each set of Appellants' preliminary objections, asserting, inter alia, that the Arbitration Clause was "unenforceable, void, voidable, invalid, and/or revocable on numerous grounds…." Davis's Responses, 1/17/2017, at 2. Davis included a laundry list of various grounds, including the three grounds Davis discusses in her appellee brief: (1) that the Arbitration Clause is a contract of adhesion and is unconscionable; (2) that the Arbitration Clause violates 42 U.S.C. § 1396r(c)(5)(iii) (prohibiting nursing homes from "charg[ing], solicit[ing], accept[ing, ] or receiv[ing] … any other consideration as a precondition of admit[ance]") because it required Davis to waive her right to a jury trial as a condition of admittance in addition to payments provided by Medicaid/Medicare; and (3) that the Arbitration Clause is void due to the doctrine of impracticability because the non-arbitrable Wrongful Death Act claim should be consolidated with the Survival Act claims.[7] Id. at 3-5; Davis's Brief at 9-18.

         Meanwhile, Appellants filed a motion for reconsideration of the December 6, 2016 order declining to compel arbitration due to Davis's not having filed a complaint. The trial court denied Appellants' motion for reconsideration on January 4, 2017. In the order denying the motion, the trial court clarified that it had issued its December 6, 2016 order solely due to Appellants' purported procedural error in filing prematurely a petition to compel, and the issue of arbitrability of the dispute was preserved until Appellants cured the errors in procedure. Trial Court Order, 1/4/2017, at 1. The trial court noted that Appellants had filed preliminary objections raising the issue of arbitration in response to Davis's formal complaint, which preserved their objection. Id. As such, the trial court expressly held that Pa.R.A.P. 311(g)(1)(iv) ("Failure to file an appeal from an interlocutory order refusing to compel arbitration, appealable under 42 Pa.C.S. § 7320(a)(1) and subparagraph (a)(8) of this rule, shall constitute a waiver of all objections to such an order.") did not apply. Id.

         On January 24, 2017, the trial court[8] issued the orders in question overruling Appellants' preliminary objections in the nature of petitions to compel arbitration. Trial Court Order, 1/24/2017, at 1. The trial court did not explain its ruling and ordered Appellants to file answers to the complaint within 20 days from the date of the orders. Id.

         Appellants timely filed notices of appeal. The trial court did not order Appellants to file a concise statement of errors complained of on appeal, but did issue an opinion pursuant to Pa.R.A.P. 1925(a).

         Appellants ask this Court to resolve three issues on appeal.[9] First, Appellants disagree with the trial court's conclusion in its Rule 1925(a) opinion that their claims are untimely, waived, and/or moot. AOP's Brief at 5; CMG's Brief at 8. Second, Appellants contend that the trial court erred by refusing to compel arbitration of all claims Davis is making on behalf of Decedent and her estate, because such claims are (a) subject to the Arbitration Clause in the Admission Agreement executed by Davis on Decedent's behalf pursuant to a valid power of attorney and (b) within the scope of the Arbitration Clause. Id. Finally, Appellants argue that the trial court should not have overruled their preliminary objections because Davis failed to raise a dispute of material fact or legal argument precluding enforcement of the Arbitration Clause in ...


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