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New Mexico Court of Appeals Refuses to Enforce Arbitration Clause in Nursing Home Neglect Case

Posted in Firm News

Earlier this year in the case of Cecil v. Skilled Healthcare, the New Mexico Court of Appeals made a ruling that allowed a plaintiff’s negligence and wrongful death lawsuit against a nursing home to proceed, rejecting a clause in the nursing home contract that mandated all claims be addressed only through arbitration. As a result of this ruling, the family of a man who died while in the care of the nursing home will be able to have their claims heard by the state court and potentially given the opportunity for a jury to find the defendants liable for the death of their loved one.

Arbitration Agreements in Nursing Home Contracts
Many nursing home residency agreements require a prospective resident to agree that any civil claims against the nursing home can only be resolved through arbitration. Arbitration is an alternative form of dispute resolution in which the parties agree to have their dispute heard by an arbitrator, which is a private party that takes the place of the courts. In arbitration, the parties argue their cases in a court-like environment, and the decision of the arbitrator is final and enforceable, as if it were a court order. If a plaintiff has agreed to an enforceable arbitration clause, he or she must file any claim with the arbitrator and follow the rules and procedures of the arbitrator.

Under the law, arbitrators must be impartial, and they are required to apply the laws of the jurisdiction where the claim originated. Although arbitrators are legally required to be impartial, nursing homes generally benefit from requiring all claims against them to be resolved through arbitration. Nursing homes and their attorneys are experienced and at home in the arbitration tribunals where claims against them are heard. Since arbitration procedures are generally simpler than court procedures, the cost of arbitration is usually less than a civil suit. This lower cost of arbitration benefits the nursing homes more than injured plaintiffs, who usually pay little or nothing out of pocket to initiate a lawsuit.

The plaintiffs in Cecil v. Skilled Healthcare Group filed a New Mexico nursing home neglect case in state court after their loved one was killed in the care of the nursing home. Since the deceased person had agreed to arbitration in his residency agreement, the attorneys for the nursing home moved to dismiss the civil suit against their client and compel the parties to arbitration.

The plaintiff’s attorneys argued, and the court agreed, that the arbitration agreement in this contract was so one-sided in favor of the nursing home that it was “substantively unconscionable,” and it was too unfair to be enforced by the Court. The Court found that the agreement was unfair because “the [nursing home] unreasonably reserves the vast majority of [its own] claims for the courts, while subjecting the weaker party to arbitration on essentially all of the claims that party is most likely to bring.”

Since the defendants’ motion was denied, the plaintiff’s case will go on in state court, and the arbitration will not occur. If the defendant’s motion was granted and arbitration compelled, the plaintiff would still have the right to have a New Mexico wrongful death attorney argue the case before a relatively fair tribunal. Often, however, a plaintiff’s attorney will prefer the more even playing field of a state court action and will fight the arbitration agreement, as occurred in the Cecil case.

Do You Need an Attorney?

If you or someone you love has been the victim of nursing home or hospital neglect, the New Mexico personal injury attorneys at The Fine Law Firm can help you with your case. Whether you signed an arbitration agreement, did not sign one, or can’t remember, we will help you make the best decisions to get the compensation that you deserve. At the Fine Law Firm, we represent clients in all New Mexico wrongful death and personal injury cases, including instances of nursing home abuse or neglect. Are you entitled to compensation? Call today at (585) 889-3463 or reach us online and see if we can help with your case.

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