Arbitration & Mediation

Georgia Courts Address Broad vs. Limited Powers of Attorney and Argument that AAA Declines Pre-Injury Arbitration Agreements

By Christopher B. Hopkins, Esq.

We travel across the Florida-Georgia border to take a quick look at two nursing home arbitration decisions with differing outcomes... and to examine the argument regarding arbitration being "impossible" since, as a policy, the AAA will not hear tort cases where a pre-injury trial waiver was signed (and now disputed).

As if this issue has not been beaten to death, a Georgia court in Triad Health Management of Georgia v Johnson (June 3, 2009), the court held that a spouse's general power of attorney provided authority to sign an arbitration clause for the other spouse being admitted to a facility. On the heels of that case, another Georgia court handed down Life Care Centers of America d/b/a Life Care Center of Gwinnett v. Smith, which held that a "durable power of attorney for health care" was insufficient to provide authority to sign an arbitration clause. In both cases, the courts acknowledged this was a case-by-case decision based upon the wording of the POA. For a Georgia lawyer's perspective, see this site.

The Smith case also brings up an interesting, albeit not-so-new argument against arbitration premised upon the fact that the American Arbitration Association currently declines to hear cases where the arbitration agreement is disputed and signed prior to the alleged injury. This same issue dates back to 2006 where the American Health Lawyers Association (AHLA) took the same position. Since the Georgia appellate court did not get past the issue of the signor's authority, it was not addressed in the opinion. We've previously explained how an arbitration agreement can be drafted to avoid this problem.

An interesting side note in Smith is the discussion about the defendant's motion directed towards disqualifying plaintiff's counsel. This sounds vaguely like a similar Florida dispute between a former nursing home defense lawyer (turned plaintiff counsel) and a large nursing home corporation. Neither court disqualified plaintiff's counsel.

Full post as published by Florida Arbitration Law on August 21, 2009 (boomark / email).