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Escareno v. Kindred Nursing Centers West, L.L.C.

Court of Appeals of Arizona, Second Division

January 26, 2016

Aristeo Escareno, Personal Representative of the Estate of Maria Escareno, on behalf of the Estate of Maria Escareno; and Aristeo Escareno, Personal Representative, for and on behalf of Maria Escareno's Statutory Beneficiaries pursuant to A.R.S. § 12-612(A), Plaintiff/Appellant,
Kindred Nursing Centers West, L.L.C., a Delaware limited liability company, dba Hacienda Rehabilitation and Care Center, nka Kindred Nursing and Rehabilitation-Hacienda; Kindred Healthcare Operating, Inc., a Delaware corporation; Kindred Healthcare, Inc., a Delaware Corporation; Joseph Chesney, Administrator; and Patrick Kinney, Administrator, Defendants/Appellees.

Appeal from the Superior Court in Cochise County No. CV201200501 The Honorable Karl D. Elledge, Judge

Law Office of Scott E. Boehm, P.C, Phoenix By Scott E. Boehm and Wilkes & McHugh, P.A., Phoenix By Melanie L. Bossie and Mary Ellen Spiece Counsel for Plaintiff/Appellant

Quintairos, Prieto, Wood & Boyer, P.A., Phoenix By Anthony J. Fernandez, Vincent J. Montell, and Rita J. Bustos Counsel for Defendants/Appellees

Presiding Judge Vásquez authored the opinion of the Court, in which Chief Judge Eckerstrom and Judge Miller concurred.


VÁSQUEZ, Presiding Judge:

¶1 Aristeo Escareno, as personal representative of the Estate of Maria Escareno and on behalf of the decedent's statutory beneficiaries, appeals from the trial court's order compelling arbitration of his claim brought under the Adult Protective Services Act (APSA) against Kindred Nursing Centers West, L.L.C., Kindred Healthcare Operating, Inc., Kindred Healthcare, Inc., Joseph Chesney, and Patrick Kinney (collectively, Kindred). On appeal, Aristeo argues the arbitration agreement relied on by Kindred was unenforceable against Maria's estate because it was not signed by Maria and he was not authorized to sign the agreement on her behalf as her agent.[1] For the reasons set forth below, we reverse the court's order and remand for further proceedings.

Factual and Procedural Background

¶2 We view the facts in the light most favorable to upholding the trial court's order compelling arbitration.[2] Estate of DeCamacho ex rel. Guthrie v. La Solana Care and Rehab, Inc., 234 Ariz. 18, n.1, 316 P.3d 607, 608 n.1 (App. 2014). Maria Escareno moved from Oklahoma to Arizona with her adult son, Aristeo, in 2006 or 2007. While in Arizona, Maria suffered a stroke and began to develop cognitive disabilities. Aristeo then assumed some of her responsibilities, paying her bills and signing medical documents on her behalf. However, Maria's capacity to live independently continued to deteriorate, and she ultimately was diagnosed with encephalopathy, cognitive deficits, and "a severe case of dementia." At the height of her disability, Maria was coherent at times but had difficulty remembering who Aristeo was, could not "participate in a conversation, " and was "childlike."

¶3 In May 2009, Arizona Adult Protective Services (APS) opened a case regarding Maria's care because she had little assistance or supervision while Aristeo worked during the day. APS "gave [Aristeo] an ultimatum: Either [he] put her in a home . . . to take care of her or [he] could also face . . . jail time." He then had Maria admitted to three different assisted-living facilities between October 2009 and April 2010, ultimately choosing Kindred because "there was no other facilities around that would be able to take her because of her dementia."[3] At each facility, Aristeo signed the admission documents on behalf of Maria. And, at Kindred, he also signed the alternative dispute resolution (ADR) agreement at issue in this case. It states, in relevant part:

Any and all claims or controversies arising out of or in any way relating to this Agreement or the Resident's stay at the Facility including disputes regarding the interpretation of this Agreement, whether arising out of State or Federal law, whether existing or arising in the future, whether for statutory, compensatory or punitive damages and whether sounding in breach of contract, tort or breach of statutory duties . . ., irrespective of the basis for the duty or of the legal theories upon which the Claim is asserted, shall be submitted to alternative dispute resolution as described in this Agreement.

¶4 Maria died in April 2011, and, the following year, Aristeo filed the underlying civil action alleging wrongful-death and APSA claims against Kindred. Kindred filed a motion to dismiss and to compel arbitration pursuant to the ADR agreement signed by Aristeo. In his response, Aristeo argued inter alia that he lacked authority to sign the agreement for Maria and that the wrongful-death claim was brought on behalf of Maria's beneficiaries, none of whom had signed the ADR agreement in their own capacity. In response to his agency argument, Kindred countered that "Aristeo's custom of acting on [Maria's] behalf [was] enough to prove agency as a matter of law."

¶5 The parties submitted a stipulated set of exhibits, and, after hearing oral argument, the trial court denied the motion as to the wrongful-death claim, but ordered that the parties submit the APSA claim to arbitration and stayed the action pending that claim's resolution.[4] This appeal followed.[5] We have jurisdiction pursuant to A.R.S. § 12-2101(A)(1). See S. Cal. Edison Co. v. Peabody W. Coal Co., 194 Ariz. 47, ¶¶ 16-20, 977 P.2d 769, 774-75 (1999).


¶6 Aristeo argues the trial court erred by compelling arbitration of the APSA claim because he "had no authority to sign the ADR agreement" on behalf of Maria. "Generally, whether agency exists is a question of fact, but when the material facts are not in dispute, the existence of such a relationship is a question of law for the court to decide." Goodman v. Physical Res. Eng'g, Inc., 229 Ariz. 25, ¶ 12, 270 P.3d 852, 856 (App. 2011); see Salvation Army v. Bryson, 229 Ariz. 204, ¶ 23, 273 P.3d 656, 663 (App. 2012). In this case, the parties do not dispute the material facts found in their stipulated set of exhibits, ...

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