Heineman v. Evangelical Lutheran Good Samaritan Soc'y
Heineman v. Evangelical Lutheran Good Samaritan Soc'y
Opinion of the Court
**188INTRODUCTION
A nursing home resident filed suit for personal injuries against the facility and several of its employees. The defendants moved to dismiss and compel arbitration pursuant to an arbitration agreement signed by the resident at the time of admission. The district court declared that the arbitration agreement was void and unenforceable on state law grounds and for being contrary to public policy. Because the court erred in both respects, we reverse, and remand with directions.
BACKGROUND
Mark Heineman filed a personal injury action against The Evangelical Lutheran Good Samaritan Society, doing business as Good Samaritan Society-Scribner, and several of its employees (collectively Evangelical Lutheran), for injuries he sustained as a resident at the Good Samaritan Society-Scribner nursing home. Heineman is a Nebraska resident and The Evangelical Lutheran Good Samaritan Society is a nonprofit North Dakota corporation with its principal place of business in South Dakota.
Evangelical Lutheran filed motions to dismiss or stay the proceedings and to compel arbitration pursuant to an arbitration clause within the admission agreement Heineman had signed before he was admitted as a resident in the nursing **189home. The signature on the second page of the arbitration section was dated February 11, 2015.
The agreement included a "Resolution of Legal Disputes" section in which Heineman agreed to arbitrate "[a]ny legal controversy, dispute, disagreement or claim arising between the Parties" by checking a box next to, "YES I DO wish to arbitrate disputes and I received a copy of this Resolution of Legal Disputes." In addition to permitting the signor to either opt into or out of the arbitration clause, the contract stated that the agreement to arbitrate disputes was not a condition of admission or of continued stay. The arbitration agreement further provided: "This arbitration provision binds all parties whose claims may arise out of or relate to treatment or service provided by the center including any spouse or heirs of the Resident." And by signing the agreement, Heineman agreed that the "Resolution of Legal Disputes" provision shall be governed by and interpreted under the Federal Arbitration Act (FAA).
The district court held two hearings on the motions to dismiss and compel arbitration. The hearings were conducted on affidavits, *755one at each hearing, offered by Evangelical Lutheran. They were substantially identical. Heineman did not offer any evidence.
After reviewing the language of the agreement, the court determined that the arbitration clause lacked "mutuality of obligation" by the parties. In doing so, the court relied on De Los Santos v. Great Western Sugar Co.
Evangelical Lutheran appealed, and we moved the case to our docket.
ASSIGNMENTS OF ERROR
Evangelical Lutheran assigns that the district court erred in (1) failing to find that the arbitration clause was governed by the FAA, (2) finding that the arbitration clause was void and unenforceable under the UAA, (3) finding that the arbitration clause lacked mutuality of obligation between the parties, (4) finding that the arbitration clause was void and unenforceable on public policy grounds, and (5) failing to dismiss or stay the action and compel arbitration.
STANDARD OF REVIEW
Arbitrability presents a question of law.
ANALYSIS
" MUTUALITY OF OBLIGATION "
The district court found that the arbitration agreement lacked "mutuality of obligation," thereby making it unenforceable. We understand "mutuality of obligation" to be the equivalent of mutuality of consideration.
**191The district court relied on De Los Santos v. Great Western Sugar Co. ,
Evangelical Lutheran argues that there was sufficient consideration and that both Evangelical Lutheran and Heineman were mutually bound by the arbitration *756agreement. It argues that the language of the agreement applies to " 'any legal controversy, dispute, disagreement, or claim of any kind,' not just to claims brought by ... Heineman."
In response to this argument, Heineman argues that Evangelical Lutheran is not actually bound by the arbitration agreement. To support this response, he cites to county and district court cases outside of our record. He asserts that in those cases, Evangelical Lutheran filed suit against its residents without first attempting arbitration. And he asks us to take judicial notice of the complaints filed in those cases as proof of this lack of mutuality of obligation.
But to expand the record in this fashion would be improper, because, generally, it is not the function of an appellate court to review evidence which was not presented to the trial court.
**192It is true that we have held that an appellate court may take judicial notice of a document, including briefs filed in an appeal, in a separate but related action concerning the same subject matter in the same court.
And without the extraneous material, his argument collapses. Consideration is sufficient to support a contract if there is any detriment to the promisee or any benefit to the promisor.
APPLICABILITY OF FAA
Having determined that an enforceable arbitration agreement existed, we now turn to consider whether the arbitration clause was subject to the requirements of the FAA or UAA.
If a contract containing an arbitration clause involves interstate commerce, the FAA governs the contract.
PUBLIC POLICY
Lastly, we consider the district court's holding that the arbitration agreement was void and unenforceable as contrary to public policy. The only authority on which the court relied was a federal regulation
However, this provision of the regulation did not become effective until November 28, 2016,
CONCLUSION
Because the arbitration agreement was valid and enforceable and governed by the FAA, the district court should have sustained the motions to dismiss and compel arbitration. But, in sustaining the motions, the district court could exercise its discretion to stay rather than dismiss the case.
REVERSED AND REMANDED WITH DIRECTIONS .
Miller-Lerman, J., not participating.
De Los Santos v. Great Western Sugar Co. ,
See
Citizens of Humanity v. Applied Underwriters ,
Frohberg Elec. Co. v. Grossenburg Implement ,
See, Black's Law Dictionary 1179 (10th ed. 2014) (defining "mutuality of obligation"); Joseph M. Perillo, Calamari and Perillo on Contracts § 4-12 (6th ed. 2009).
De Los Santos v. Great Western Sugar Co., supra note 2.
Brief for appellants at 22.
See, e.g., U.S. v. Oatman ,
In re Estate of Radford ,
See, Pennfield Oil Co. v. Winstrom ,
City of Omaha v. City of Elkhorn ,
See Wilczewski v. Charter West Nat. Bank ,
See Frohberg Elec. Co. v. Grossenburg Implement, supra note 6.
See Kremer v. Rural Community Ins. Co. ,
See Medicare and Medicaid Programs; Reform of Requirements for Long-Term Care Facilities,
Bowen v. Georgetown University Hospital ,
American Health Care Association v. Burwell ,
See Wilczewski v. Charter West Nat. Bank, supra note 14.
Reference
- Full Case Name
- Mark HEINEMAN v. The EVANGELICAL LUTHERAN GOOD SAMARITAN SOCIETY, doing business as Good Samaritan Society-Scribner
- Cited By
- 7 cases
- Status
- Published