Dean v. Heritage Healthcare of Ridgeway, LLC

Summary

The South Carolina Supreme Court reversed and remanded a circuit court decision refusing to compel arbitration in a nursing-home wrongful-death and survival action. The court held that the nursing-home residency agreement involved interstate commerce and was governed by the Federal Arbitration Act, and that the agreement's reference to the American Arbitration Association's rules did not make the AAA an indispensable arbitral forum. The court also rejected the argument that the appellants waived arbitration through delay and limited discovery during required mediation, while remanding for consideration of the respondent's remaining challenges to enforcement.

Holdings

1. The residency agreement involved interstate commerce because appellants were contractually required to provide meals and medical supplies, which are instrumentalities of interstate commerce; therefore, the Federal Arbitration Act governed the arbitration agreement.
2. The unavailability of the AAA did not invalidate the arbitration agreement because the agreement required the arbitration to follow the AAA's rules, rather than requiring the proceeding to be administered exclusively by the AAA. The circuit court therefore erred in refusing to compel arbitration on that basis.
3. Appellants did not waive their right to compel arbitration by requesting limited discovery during the required pre-suit mediation process or by moving to compel arbitration after the complaint was filed.

Questions Presented

1. Whether the nursing-home residency agreement involved interstate commerce such that the Federal Arbitration Act governed the arbitration agreement.
2. Whether the unavailability of the American Arbitration Association rendered the arbitration agreement unenforceable when the agreement required arbitration to follow the AAA's rules but did not expressly require administration by the AAA.
3. Whether appellants waived their right to compel arbitration by requesting limited discovery, participating in pre-suit mediation, and moving to compel arbitration after the complaint was filed.
4. Whether the circuit court should consider on remand Dean's arguments concerning her authority to sign the agreement and whether the parties had a meeting of the minds.

Disposition

reversed_and_remanded