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Rockledge NH, LLC v. Miley

Florida Court of Appeals, Fifth District

May 19, 2017

ROCKLEDGE NH, LLC, GREYSTONE HEALTHCARE MANAGEMENT CORP. AND JULIE D. MORRIS (AS ROCKLEDGE HEALTH AND REHABILITATION CENTER), Appellants,
v.
MARY ELIZABETH MILEY, BY AND THROUGH, BRUCE W. MILEY, ATTORNEY IN FACT, Appellee.

         NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED

         Appeal from the Circuit Court for Brevard County, George B. Turner, Judge.

          Thomas A. Valdez, Karen M. Shimonsky, and Jade M. Gummer, of Quintairos, Prieto, Wood & Boyer, P.A., Tampa, for Appellants.

          Megan L. Gisclar, and Joanna Greber Dettloff, of Wilkes & McHugh, P.A., Tampa, for Appellee.

          EVANDER, J.

         Rockledge NH, LLC, Greystone Healthcare Management Corp., and Julie D. Morris ("Appellants") appeal an order denying their motion to compel arbitration. We conclude that the arbitration agreement at issue contains an attorneys' fee provision that violates public policy. However, because the attorneys' fee provision could be properly severed from the arbitration agreement, it was error for the trial court to deny the motion to compel arbitration.

         In September 2013, Mary Miley was admitted to Rockledge Health and Rehabilitation Center ("the facility"). During her admission process, Miley signed an admission agreement that included an arbitration provision:

The facility and the resident or the resident's authorized representative recognize that future disagreements or disputes may arise and these parties both wish to agree now, in advance, to submit any disputes which may arise between the parties which they cannot otherwise resolve to binding arbitration instead of court litigation. The parties believe binding arbitration to be a speedy and economical alternative to what is generally a more protracted, more expensive, more public and more unpredictable means of resolving disputes. The parties hereto have entered into the attached arbitration agreement which is hereby incorporated by reference.
The foregoing arbitration clause does not apply to actions brought by the facility to collect accounts receivable, unless specifically set forth in writing in a separate instrument.

         Attached to the admission agreement and incorporated by reference was an "Addendum to Admission Agreement Optional Arbitration Agreement, " wherein the parties agreed to resolve any disputes related to Miley's stay at the facility by arbitration. The arbitration agreement contained a fee provision that provided that each party would be responsible for its own attorneys' fees. Finally, the arbitration agreement contained the following severability clause:

The foregoing notwithstanding, the Parties agree that all of the provisions contained in this Agreement are severable. In the event any provision of the agreement, or portion thereof, or any rule incorporated by reference in the agreement, is held to be invalid by a court of competent jurisdiction, this agreement shall be interpreted as if the invalid provision or portion was not contained herein, and the remaining provisions of the agreement will remain in full force and effect. This agreement to arbitrate will not fail because any part, clause or provision hereof is held to be indefinite or invalid.

         In June 2015, Miley, by and through her attorney-in-fact (and husband), Bruce Miley, sued the facility owner-Rockledge NH, LLC, the facility management company- Greystone Healthcare Management Corp., and the facility administrator-Julie Morris. The four-count complaint included a count for violation of Florida's Nursing Home Residential Rights Act, sections 400.022-.023, Florida Statutes (2013), two counts for violation of Florida's Adult Protective Services Act, section 415.1111, Florida Statutes (2013), and one count for breach of fiduciary duty.

         Appellants responded to the complaint by filing a Motion to Dismiss and to Compel Arbitration. The trial court denied the motion, finding that the attorneys' fee provision violated public policy because it effectively "replaced" the prevailing party provision set forth in section 415.1111 with a provision requiring each party to be responsible for its own attorneys' fees. The trial court further found that the attorneys' fee provision was not severable. This appeal followed.

         Florida's Adult Protective Services Act is remedial in nature. Hochbaum v. Palm Garden of Winter Haven, LLC, 201 So.3d 218, 220 (Fla. 2d DCA 2016). Accordingly, an arbitration agreement provision that purports to preclude application of the Act's prevailing party fee provision is unenforceable because it violates public policy. See id. at 221 (holding that arbitration agreement ...


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