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 lawsuit was filed concerning the care received by a resident at a long-term care facility operated by the Defendants. The resident's son signed an admission and arbitration agreement upon the resident's admission, but he did not have the legal authority to represent the resident. The resident did not sign any documents. The Defendants sought to compel arbitration based on the agreement signed by the son (paras 2-3, 5-7).
Procedural History
- District Court, Santa Fe County: The court denied the Defendants' motion to compel arbitration, concluding that the arbitration agreement could not be enforced against the resident's wrongful death estate (para 3).
Parties' Submissions
- Defendants: Argued that the district court erred by not referring the enforceability of the arbitration agreement to the arbitrator and claimed that the Plaintiff should be compelled to arbitrate as an intended third-party beneficiary of the agreement (para 1).
- Plaintiff: Contended that no agreement was formed between the Defendants and the resident, as the son had no authority to bind the resident to arbitration. Additionally, argued that New Mexico law does not allow a signatory to enforce a contract against a third-party beneficiary (para 9).
Legal Issues
- Whether the district court erred in declining to refer the question of enforceability of the arbitration agreement against a non-signatory to the arbitrator (para 1).
- Whether the Plaintiff, as an intended third-party beneficiary, should be compelled to arbitrate the claims against the Defendants (para 1).
Disposition
- The Court of Appeals affirmed the district court's denial of the Defendants' motion to compel arbitration (para 4).
Reasons
Per Duffy J. (Ives and Henderson JJ. concurring):
The court determined that the issue of whether a non-signatory can be bound by an arbitration agreement is a matter of contract formation, which must be decided by the court, not the arbitrator. The court emphasized that arbitration is a matter of consent, and a non-signatory cannot be compelled to arbitrate unless they have agreed to do so. The court also held that the third-party beneficiary doctrine does not allow a signatory to enforce a contract against a non-signatory third-party beneficiary unless the third-party beneficiary has sought to enforce the contract. The court found no evidence that the resident accepted the arbitration agreement, and thus, the agreement could not be enforced against the Plaintiff (paras 4, 12-14, 20-21, 26-36).