Heineman v. Evangelical Luth. Good Sam. Soc.

Summary

The Nebraska Supreme Court held that a nursing home admission agreement containing an arbitration clause was valid and enforceable. Because the agreement involved interstate commerce, the Federal Arbitration Act governed and preempted inconsistent state-law requirements applicable solely to arbitration provisions. The court also rejected a public-policy challenge based on a federal regulation that was enacted after the agreement and had been enjoined, reversing and remanding with directions to compel arbitration and either stay or dismiss the action.

Holdings

1. The arbitration agreement was supported by sufficient consideration and did not fail for lack of mutuality of obligation because its language applied equally to claims brought by Heineman and by the nursing home.
2. The Federal Arbitration Act governed the arbitration agreement because the contract involved interstate commerce.
3. The arbitration agreement did not need to strictly comply with the language of Nebraska's Uniform Arbitration Act because the FAA preempted inconsistent state laws applying solely to the enforceability of arbitration provisions in contracts involving commerce.
4. The federal nursing-home regulation did not invalidate the arbitration agreement because it became effective after the agreement was signed, did not require retroactive application, and had been enjoined from implementation.

Questions Presented

1. Whether the arbitration agreement was unenforceable for lack of mutuality of obligation or consideration.
2. Whether the arbitration agreement involved interstate commerce and was governed by the Federal Arbitration Act rather than Nebraska's Uniform Arbitration Act.
3. Whether the Federal Arbitration Act preempted Nebraska requirements that the arbitration agreement strictly comply with the Uniform Arbitration Act.
4. Whether a federal nursing-home regulation effective after the agreement was signed rendered the agreement void as contrary to public policy.
5. Whether the defendants were entitled to an order compelling arbitration and whether the underlying action should be dismissed or stayed.

Disposition

reversed_and_remanded