On March 13, 2009, Juan Mendez Sr. was admitted to a nursing facility. On that day, a

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On March 13, 2009, Juan Mendez Sr. was admitted to a nursing facility. On that day, a doctor employed by the facility determined the father lacked the capacity to give informed consent or make medical decisions. The son signed the admission forms, including an agreement for care that contained a broad arbitration clause providing that any case arising out of the agreement would be settled by arbitration. In late July, while at the facility, Mr. Mendez Sr. was treated for an eye infection, and the infection ended in Mr. Menendez losing his eye. Mr. Mendez Jr. subsequently received power of attorney for his father.
In December 2012, the son sued the facility on behalf of the father. The facility moved to compel arbitration on the basis of the arbitration clause in the agreement. The son asserted that the arbitration clause was not binding on the father, who was not a party to the agreement, and was merely a third-party beneficiary. The trial court compelled arbitration and Menendez appealed.
JUSTICES WELLS, LAGOA, AND LOGUE “The Florida Supreme Court has held that “arbitration is a favored means of dispute resolution.”… Where possible, courts “should resolve all doubts in favor of arbitration rather than against it.”…
It is well-established that “[a]rbitration clauses in contracts are binding on third party beneficiaries.” … This is true even if the third-party beneficiary did not sign the contract containing the arbitration agreement: “a nonsignatory to an arbitration agreement may be bound to arbitrate if the nonsignatory has received something more than an incidental or consequential benefit of the contract, or if the nonsignatory is specifically the intended third-party beneficiary of the contract.”
Here, the father is not merely the incidental beneficiary of the agreement, he is the intended third-party beneficiary of the agreement. The intent of the parties to the agreement was to arrange for the father’s care at the facility, and the father received the benefit of the parties’ bargain under that agreement for the duration of his residency at the facility. As a third-party beneficiary to the agreement, the father is bound by the arbitration provision.
The First District came to a similar conclusion in Alterra Healthcare Corp. v. Estate of Linton ex rel. Graham…. In Linton, a nursing home facility moved to compel arbitration in a suit brought on behalf of Mrs. Linton, its deceased former resident…. The plaintiff maintained that the resident was not bound by the arbitration clause contained in the residency agreement signed by her adult son because her son had no authority to sign the agreement on her behalf. The First District held:
We reject the plaintiff’s argument that there was not a valid agreement to arbitrate that was binding on Mrs. Linton, because she did not sign the agreement.
In general, arbitration provisions are personal covenants that bind only the parties thereto. But the trial court correctly concluded that Mrs. Linton was an intended third-party beneficiary of the agreement in the present case. A nonsignatory third-party beneficiary is bound by the terms of a contract containing an arbitration clause. We apply similar reasoning to the analogous facts presented here in reaching the conclusion that the father is bound by the arbitration clause in the agreement.
Judgment of the trial court AFFIRMED in favor of the plaintiff.
CRITICAL THINKING:

 The court relied on an analogy in making its ruling. Evaluate the quality of the analogy.
ETHICAL DECISION MAKING:

Which stakeholders’ interests are affected by the outcome of this case?

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Dynamic Business Law

ISBN: 9781260733976

6th Edition

Authors: Nancy Kubasek, M. Neil Browne, Daniel Herron, Lucien Dhooge, Linda Barkacs

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