More on Pre-Arbitration Agreements

Friday’s post was in response to the Emeritus trial currently underway in Sacramento, CA. The ASHA issued a brief on pre-arbitration agreements in 2009 that provided useful data and suggestions for operators of assisted living communities. The rational for using  pre-arbitration agreements in senior housing contracts were:

  • Arbitration is cheaper than litigation.
  • The arbitration process is speedier than the court system.
  • Arbitration is private and confidential, unlike the court system and therefore limits bad press.

The downsides of using arbitration?

  • Arbitrators tend to act more like mediators, “splitting the difference” rather than rending decisions in favor of the defendant. 
  • Consumers win higher awards and more of the requested relief in arbitration than they do in court.
  • Arbitration is usually binding and therefore cannot be appealed.

Courts have nullified arbitration agreements in cases where the plaintiff was incompetent, hadn’t signed (even when a family member signed),  or overwhelmingly favored the housing provider.  To best protect an assisted living community the brief recommends offering voluntary arbitration agreements instead of making acceptance of them mandatory for moving in (90% of residents sign a voluntary agreement when it’s presented thoroughly). It recommends making the offer early in the resident information gathering process and separate from the regular housing contract.  Finally, the arbitration agreement needs to be fair, even-handed, and careful to avoid any language that might be construed as aggressive or predatory.

The Arbitration Process - April 7, 2011

2 thoughts on “More on Pre-Arbitration Agreements

  1. Pingback: Arbitration Agreements in Assisted Living | Senior Care stuff

  2. Pingback: Emeritus Trial – Jury finds Company Guilty, Awards $23 Million to Plaintiffs | Senior Care stuff

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