This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.
Facts
A wrongful death estate, represented by the Plaintiff, filed a lawsuit against Casa Maria Healthcare Center and related entities after the death of a resident, Cheryl Smith. The resident's daughter had signed an admission agreement and a separate arbitration agreement upon the resident's initial admission to the facility. However, the resident did not sign these documents. After the resident's death, the Plaintiff pursued claims of wrongful death, negligence, unfair trade practices, and punitive damages against the Defendants (paras 2-4).
Procedural History
- District Court of Santa Fe County: Denied Defendants' motion to compel arbitration, concluding that Defendants failed to establish an agreement to arbitrate between the resident and Defendants (para 4).
Parties' Submissions
- Defendants-Appellants: Argued that the arbitration agreement signed by the resident's daughter should bind the resident's estate, asserting that the agreement's delegation provisions required an arbitrator to decide enforceability, that the resident was a third-party beneficiary, and that a readmission agreement signed by the resident incorporated the arbitration agreement (para 5).
- Plaintiff-Appellee: [Not applicable or not found]
Legal Issues
- Whether the district court erred in denying the motion to compel arbitration based on the delegation provisions in the arbitration agreement.
- Whether the resident's estate is bound to arbitrate under a third-party beneficiary theory.
- Whether the readmission agreement signed by the resident incorporated the arbitration agreement (para 5).
Disposition
- The Court of Appeals affirmed the district court's denial of the motion to compel arbitration (para 1).
Reasons
Per Duffy J. (Ives and Henderson JJ. concurring):
The Court found that the district court correctly determined that the question of whether a non-signatory can be bound by an arbitration agreement is a matter of contract formation for the court to decide, not the arbitrator, even with a delegation clause present (para 7). The Court also held that the third-party beneficiary doctrine does not allow enforcement of a contract against a non-signatory third-party beneficiary unless the beneficiary has sought to enforce the contract, which was not the case here (para 8). Regarding the incorporation by reference, the Court concluded that the readmission agreement did not clearly incorporate the arbitration agreement, as it did not explicitly reference it, and there was no evidence that the resident was aware of the arbitration agreement's existence (paras 10-15).