J-A03026-15
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
BRANDON HETRICK, EXECUTOR OF THE IN THE SUPERIOR COURT OF
ESTATE OF: WILLIAM WASHINGTON, PENNSYLVANIA
DECEASED,
Appellee
v.
MANORCARE OF CARLISLE, PA, LLC,
D/B/A MANORCARE HEALTH SERVICES,
CARLISLE; HRC MANORCARE, INC., ET
AL.,
Appellants No. 266 MDA 2014
Appeal from the Order entered January 13, 2014
In the Court of Common Pleas of Cumberland County
Civil Division at No: 11-7979
BEFORE: MUNDY, STABILE, and FITZGERALD,* JJ.
MEMORANDUM BY STABILE, J.: FILED JUNE 03, 2015
This case concerns the enforceability of a pre-dispute agreement to
arbitrate claims under a nursing home agreement. This Court recently has
decided appeals we find dispositive here. In two cases, we held
unenforceable arbitration agreements similar to the agreement here.1
____________________________________________
*
Former Justice specially assigned to the Superior Court.
1
See Taylor v. Extendicare Health Facilities, Inc., 2015 PA Super 64,
2015 WL 1514487, 2015 Pa. Super. LEXIS 144 (filed Apr. 2, 2015), pet. for
allowance of appeal filed, No. 161 WAL 2015 (Pa. May 4, 2015); Pisano v.
Extendicare Homes, Inc., 77 A.3d 651, 663 (Pa. Super. 2013), appeal
denied, 86 A.3d 233 (Pa.), cert. denied, 134 S. Ct. 2890 (2014).
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Pisano and Taylor compel us here to affirm the trial court’s order, which
overruled preliminary objections seeking to compel arbitration.
Appellants (collectively, ManorCare) own and operate nursing homes.
On April 14, 2009, William Washington, the decedent, was admitted to
ManorCare’s nursing home in Carlisle, Cumberland County. According to his
admission documents, Washington generally was in poor health, and
specifically was suffering from complications of diabetes. The next day, he
signed a document entitled “Arbitration and Limitation of Liability
Agreement” (Arbitration Agreement). The Arbitration Agreement contains
the following clauses:
Any and all claims or controversies between [ManorCare] and
[Washington] arising out of or in any way related to or
connected to [Washington’s] stay and care at [ManorCare],
including, but not limited to, disputes regarding alleged personal
injury to [Washington] caused by improper or inadequate care,
allegations of medical malpractice, and interpretation of this
Agreement, whether arising out of State or Federal law, and
whether based upon statutory duties, breach of contract, tort
theories or other legal theories under Pennsylvania law, including
unpaid nursing home or related charges, shall be submitted to
final and binding arbitration. Except as expressly set forth
herein, the provisions of the Pennsylvania Uniform Arbitration
Act, 42 Pa. Cons. Stat. § 7301, et[] seq., shall govern the
arbitration. Each party hereby waives its right to file a court
action for any matter covered by this agreement.
***
This Arbitration Agreement is intended to be enforceable to the
extent permitted by law, and shall only be limited to the extent
that it is expressly prohibited or limited under applicable federal,
state or local law.
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ManorCare’s Prelim. Objections, 9/27/12, Exhibit B, Arbitration Agreement
¶¶ A(1.1), D(1.3).
A little over one year later, on May 3, 2010, Washington died intestate
after spending several days in hospice care. One of Washington’s three
children, Appellee, Brandon Hetrick, was appointed executor of Washington’s
estate. Hetrick filed a wrongful death and survival action against
ManorCare. ManorCare filed preliminary objections seeking to compel
arbitration under the Arbitration Agreement. In his response to the
preliminary objections, Hetrick claimed that Washington did not sign the
Arbitration Agreement. Following oral argument, the trial court en banc
granted discovery “on the issue of whether [Appellee’s] decedent signed the
[A]rbitration [A]greement at issue.” Trial Court Order, 4/19/13. After
completing discovery, the parties submitted supplemental memoranda of
law. Hetrick abandoned his argument that Washington did not sign the
Arbitration Agreement, but instead argued the Arbitration Agreement was
unenforceable, unconscionable, or void. On January 13, 2014, the trial court
overruled ManorCare’s preliminary objections.
ManorCare timely appealed, and filed a concise statement of errors
complained of on appeal as ordered.2 In its opinion issued under Pa.R.A.P.
____________________________________________
2
An order overruling preliminary objections to compel arbitration is
interlocutory, but is appealable as of right. See Pa.R.A.P. 311(a)(8); 42
Pa.C.S.A. § 7320; see also Pisano, 77 A.3d at 654.
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1925(a), the trial court explained that Pisano precluded enforcement of the
arbitration agreement as to the wrongful death claim, and Pennsylvania Rule
of Civil Procedure 213(e)3 precluded severance of the survival action. The
trial court overruled ManorCare’s preliminary objections to compel
arbitration. It did not address Hetrick’s unconscionability argument.
On appeal, ManorCare, argues the trial court erred in failing to order
severance of the survival action claims. See Appellants’ Brief at 4. Appellee
contends that, if we find the survival action severable, we may affirm on the
alternative ground that the Arbitration Agreement is unconscionable.
“Our review of a claim that the trial court improperly denied the
appellant’s preliminary objections in the nature of a petition to compel
arbitration is limited to determining whether the trial court’s findings are
supported by substantial evidence and whether the trial court abused its
discretion in denying the petition.” Pisano, 77 A.3d at 654 (quoting
Walton v. Johnson, 66 A.3d 782, 787 (Pa. Super. 2013)).
In doing so, we employ a two-part test to determine whether the
trial court should have compelled arbitration.” Elwyn[ v.
____________________________________________
3
Rule 213(e) provides, in relevant part:
A cause of action for the wrongful death of a decedent and a
cause of action for the injuries of the decedent which survives
his or her death may be enforced in one action, but if
independent actions are commenced they shall be consolidated
for trial.
Pa.R.C.P. No. 213(e).
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DeLuca, 48 A.3d 457, 461 (Pa. Super. 2012)] (quoting Smay v.
E.R. Stuebner, Inc., 864 A.2d 1266, 1270 (Pa. Super. 2004)).
First, we examine whether a valid agreement to arbitrate exists.
Second, we must determine whether the dispute is within the
scope of the agreement.
Id. at 654-55. “Whether a claim is within the scope of an arbitration
provision is a matter of contract, and as with all questions of law, our review
of the trial court’s conclusion is plenary.” Elwyn, 48 A.3d at 461.
In Pisano, we held that “wrongful death actions are derivative of
decedents’ injuries but are not derivative of decedents’ rights.” Id. at 660.
Therefore, an agreement to arbitrate between the decedent and the nursing
home does not bind the decedent’s beneficiaries who have the right to bring
a wrongful death claim.4 Id. at 660-62. Such beneficiaries were neither a
party to, nor a third-party beneficiary of, the agreement. Id. Accordingly,
we rejected the nursing home’s argument that the Federal Arbitration Act
(FAA), 9 U.S.C. §§ 1-16, required the decedent’s representative to arbitrate
the wrongful death claim. Pisano, 77 A.3d at 660-62. The FAA expresses a
policy in favor of arbitration, but it does not make arbitration agreements
more enforceable than other contracts. Id. Thus, in Pisano, we held the
arbitration agreement between the decedent and the nursing home was
unenforceable under general principles of contract law.
____________________________________________
4
42 Pa.C.S.A. § 8301(b) limits beneficiaries to spouses, children, or parents.
The beneficiaries in Pisano and this case are children of the decedents.
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Pisano is controlling vis-à-vis Hetrick’s wrongful death claims, which
ManorCare implicitly recognizes. As a remedy, ManorCare requests that we
reverse and remand for the trial court to sever and send to arbitration the
survival action claims. We decline to do so, as we find Taylor dispositive of
this argument.
In Taylor, the decedent was hospitalized several times for various
maladies while living in an assisted living facility. Taylor, 2015 WL
1514487, at *1, 2015 Pa. Super. LEXIS 144, at *1-3. She was eventually
transferred to a nursing home, and then to hospice care, where she passed
away. The decedent’s co-executors sued the hospital, the assisted living
facility, and the nursing home for negligence. The nursing home filed
preliminary objections, contending that the claims against it were subject to
arbitration. The trial court overruled the preliminary objections, and the
nursing home appealed.
We first held that Pisano precluded arbitration of the co-executors’
wrongful death claim against the nursing home. Id. at *2, 2015 Pa. Super.
LEXIS 144, at *5-6. We then held that the survival action claim also was
not subject to arbitration. We began by noting that Rule 213(e) requires
consolidation of wrongful death and survival action claims. We stated
further:
Nor does Pa.R.C.P. 213(e) provide the only support for
consolidating the wrongful death and survival actions.[n.4] In the
wrongful death statute, 42 Pa.C.S. § 8301(a), the legislature
acknowledged the overlap in the wrongful death and survival
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actions and the potential for duplicate recovery, and mandated
consolidation of the actions:
(a) General rule.—An action may be brought, under
procedures prescribed by general rules, to recover
damages for the death of an individual caused by the
wrongful act or neglect or unlawful violence or negligence
of another if no recovery for the same damages claimed in
the wrongful death action was obtained by the injured
individual during his lifetime and any prior actions for
the same injuries are consolidated with the wrongful
death claim so as to avoid a duplicate recovery.
42 Pa.C.S. § 8301(a) (emphasis added). We find both the rule
and the statute applicable.
[n.4] Pa.R.C.P. 1020(d)(1) is also implicated herein. It
provides for the mandatory joinder in separate counts of
all causes of action against the same person arising from
the same transaction or occurrence to avoid waiver. The
basis for both Rule 213 and Rule 1020 “is the avoidance of
multiple trials and proceedings involving common facts or
issues or arising from the same transaction or occurrence.
The avoidance of duplication of effort is a benefit to both
the parties and the courts.” 1990 Explanatory Comments
to Pa.R.C.P. 213.
Taylor, 2015 WL 1514487, at *4 & n.4, 2015 Pa. Super. LEXIS 144, at *9-
10 & n.4.
Next, we rejected the nursing home’s claim that the FAA preempts
Rule 213(e) insofar as it operates to preclude arbitration of survival action
claims joined with non-arbitral wrongful death claims:
Preemption stems from the Supremacy Clause of the United
States Constitution, Article VI, cl. 2, which provides that federal
law is paramount, and that laws in conflict with federal law are
without effect. Altria Group, Inc. v. Good, 555 U.S. 70
(2008). There are several types of preemption, one being
express preemption, where the federal law contains a provision
announcing its intention to supplant state law. There is also field
preemption, where the federal statute “reflect[s] a Congressional
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intent to occupy the entire field” of law. Volt Information
Sciences, Inc. v. Bd. of Trs. of Leland Stanford Junior
Univ., 489 U.S. 468, 477 (1989). The [FAA] does not contain
an express preemption provision and Congress did not intend to
occupy the field of arbitration. Id.
However, as this Court noted in Trombetta v. Raymond
James Fin. Servs., 907 A.2d 550, 564 (Pa. Super. 2006),
“[e]ven when Congress has not completely displaced state
regulation in an area, . . . state law may nonetheless be pre-
empted to the extent that it conflicts with federal law; that is, to
the extent that it stands as an obstacle to the accomplishment
and execution of the full purposes and objectives of Congress.”
Trombetta, 907 A.2d at 564 (quoting Volt, 489 U.S. at 477).
This concept is known as conflict preemption, and may arise in
two contexts. First, a conflict occurs when compliance with both
state and federal law is an impossibility. Holt’s Cigar Co. v.
City of Phila., 10 A.3d 902, 918, (Pa. 2011). Second, conflict
preemption may be found when state law “stands as an obstacle
to the accomplishments and execution of the full purposes and
objectives of Congress.” Id.; Barnett Bank of Marion County
v. Nelson, 517 U.S. 25, 31 (1996). It is this type of conflict
preemption that [the nursing home] contends is applicable
herein.
Pennsylvania applies a presumption against federal preemption
of state law. Dooner v. DiDonato, 971 A.2d 1187 (Pa. 2009)
(citing Altria Group, Inc., 555 U.S. at 77) (When addressing
questions of express or implied preemption, we begin our
analysis “with the assumption that the historic police powers of
the States [are] not to be superseded by the Federal Act unless
that was the clear and manifest purpose of Congress.”). This
presumption flows from the existence of “dual jurisdiction” and
arises “from reasons of comity and mutual respect between the
two judicial systems that form the framework” of our federalist
system. Kiak v. Crown Equip. Corp., 989 A.2d 385, 390 (Pa.
Super. 2010).
With these principles in mind, we turn to the federal law that
[the nursing home] contends pre-empts state law herein, the
FAA. The FAA was promulgated because the judiciary was
reluctant to enforce arbitration agreements, and the act was
intended to place arbitration agreements on the same footing as
other contracts. Volt, 489 U.S. 468. The Supreme Court
reiterated in Dean Witter Reynolds Inc. v. Byrd, 470 U.S.
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213, 219 (1985), that “the overriding goal of the Arbitration Act
was [not] to promote the expeditious resolution of claims,” but
to “ensure judicial enforcement of privately made agreements to
arbitrate.” Although the Dean Witter Court downplayed the
notion that a desire for efficiency motivated the passage of the
FAA, the House Report on the FAA, quoted therein, suggests that
efficiency, both temporal and financial, played a role in the
passage of the FAA. The Report stated, “It is practically
appropriate that the action should be taken at this time when
there is so much agitation against the costliness and delays of
litigation. These matters can be largely eliminated by
agreements for arbitration, if arbitration agreements are made
valid and enforceable.” H.R. Rep. No. 96, 68th Cong., 1st Sess.,
2 (1924).
Consistent with the goal of ensuring that arbitration agreements
are enforced, however, the FAA does not require parties to
arbitrate absent an agreement to do so. See Prima Paint
Corp. v. Conklin Mfg. Co., 388 U.S. 395, 404 n. 12 (1967)
(construing the Act as designed “to make arbitration agreements
as enforceable as other contracts, but not more so”).
Pennsylvania has a well-established public policy that favors
arbitration, and this policy aligns with the federal approach
expressed in the FAA. Gaffer Ins. Co. v. Discover Reins. Co.,
936 A.2d 1109, 1113 (Pa. Super. 2007). However, as this Court
stated in Pisano, “compelling arbitration upon individuals who
did not waive their right to a jury trial” infringes upon a
constitutional right conferred in Pa. Const. art. 1, § 6 (“Trial by
jury shall be as heretofore, and the right thereof remain
inviolate.”). See Bruckshaw v. Frankford Hosp. of City of
Phila., 58 A.3d 102, 108–109 (Pa. 2012) (recognizing
constitutional right to jury trial in both civil and criminal cases).
We added in Pisano that denying wrongful death beneficiaries
their right to a jury trial “would amount to this Court placing
contract law above that of both the United States and
Pennsylvania Constitutions.” Pisano, 77 A.3d at 660–61.
[The nursing home] maintains that the survival claim against it
must be severed and enforced in arbitration, and that state law
to the contrary is pre-empted. We disagree. Neither Pa.R.C.P.
213 nor 42 Pa.C.S. § 8301 prohibits the arbitration of wrongful
death and survival claims. Thus, the instant case does not
mirror the categorical prohibition of arbitration of wrongful death
and survival actions that the Marmet Court viewed as a clear
conflict between federal and state law. See also e.g., Preston
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v. Ferrer, 552 U.S. 346, 356 (2008) (FAA pre-empts state law
granting state commissioner exclusive jurisdiction to decide
issue the parties agreed to arbitrate); Mastrobuono v.
Shearson Lehman Hutton, Inc., 514 U.S. 52, 56 (1995) (FAA
pre-empts state law requiring judicial resolution of claims
involving punitive damages); Perry v. Thomas, 482 U.S. 483,
491 (1987) (FAA pre-empts state-law requirement that litigants
be provided a judicial forum for wage disputes); Southland
Corp., 465 U.S. 1, 16 (1984) (FAA pre-empts state financial
investment statute’s prohibition of arbitration of claims brought
under that statute).
***
The statute and rule at issue are not “aimed at destroying
arbitration” and do not demand “procedures incompatible with
arbitration.” AT&T Mobility LLC v. Concepcion, 131 S. Ct.
1740, 1747–48 (2011). Nor are they so incompatible with
arbitration as to “wholly eviscerate arbitration agreements.” Id.
On the facts herein, the wrongful death beneficiaries’
constitutional right to a jury trial and the state’s interest in
litigating wrongful death and survival claims together require
that they all proceed in court rather than arbitration. In so
holding, we are promoting one of the two primary objectives of
arbitration, which is “to achieve streamlined proceedings and
expeditious results.” Concepcion, 131 S. Ct. at 1742. For
these reasons, we affirm the trial court’s order overruling [the
nursing home’s] preliminary objection seeking to compel
arbitration.
Taylor, 2015 WL 1514487, at *5-7, 9, 2015 Pa. Super. LEXIS 144, at *12-
17, 24 (some internal citations altered and parallel citations omitted).
In Taylor, we thus rejected an argument identical to the argument
ManorCare makes here. Under Pisano, Hetrick’s wrongful death claims are
not arbitral, because he is not a party to the Arbitration Agreement between
his deceased father and ManorCare. Moreover, under Taylor, Rule 213(e),
which is not preempted by the FAA, requires the survival action claims to be
consolidated with the wrongful death claims.
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Since Pisano and Taylor are dispositive here, we need not address
Hetrick’s argument that the unconscionability of the Arbitration Agreement
provides an alternative basis to affirm. In sum, the trial court did not err in
overruling ManorCare’s preliminary objections.5 Consequently, we affirm.
Order affirmed. Jurisdiction relinquished.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 6/3/2015
____________________________________________
5
We recognize that legal issues similar to the ones raised in this case are
pending before this Court en banc. See MacPherson v. The Magee Mem.
Hosp. for Convalescence, No. 80 EDA 2013 (argued Mar. 24, 2015). In
MacPherson, however, no beneficiaries under 42 Pa.C.S.A. § 8301(b)
existed, so the decedent’s personal representative brought a wrongful death
claim on behalf of the estate under § 8301(d).
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Hetrick, B. v. Manorcare of Carlisle, PA
Combined Opinion