Court Finds Nursing Home Waived Its Right to Arbitrate Wrongful Death Lawsuit as a Result of Litigious Behavior and Delay in Motion to Compel Arbitration

A Mississippi Appeals Court reverses and remands a trial court’s order granting a nursing home’s motion to compel arbitration. The nursing home inexcusably delayed enforcement of an arbitration agreement, which also caused prejudice to the Plaintiff’s claim. In Wilson v. Lexington Manor Senior Care (Miss. Ct. App., No. 2021-CA-00072-COA, August 30, 2022).

Willie Wilson was admitted to Lexington Manor Senior Care, LLC (LMSC) in June 2015 and again in July 2015. On each occasion, the person admitting him signed an arbitration agreement. Mr. Wilson died in LMSC’s care in August 2015. In 2017, Mr. Wilson’s son, Tovas, filed a wrongful death lawsuit against LMSC.

LMSC participated in the litigation. It filed an answer in which it alleged 38 defenses but never raised arbitration as a defense. It then filed a motion to dismiss or for summary judgment, arguing it had not been properly served, and the statute of limitations had expired. It did not raise any issues related to arbitration. The trial court denied LMSC’s motion.

In 2018, LMSC filed a motion to compel arbitration. The Plaintiffs argued that this motion should be denied because LMSC had waived its right to arbitrate by extensively litigating the case in court and had acted inconsistently with the alleged arbitration agreement. The Plaintiffs also argued that the persons admitting Mr. Wilson did not have the authority to sign an arbitration agreement.

In 2020, the trial court determined that the admitting individuals did have the authority to enter into an arbitration agreement and that it would compel arbitration. In 2021, the Plaintiffs appealed.

The Appeals Court declines to review the trial court’s findings concerning the Plaintiff’s argument that the admitting individuals did not have the authority to enter into an arbitration agreement. It solely assesses the issue of whether LMSC waived its right to compel arbitration.

LMSC engaged in significant litigation and conduct inconsistent with promptly seeking to enforce an arbitration agreement. It failed to raise the arbitration agreement as a defense in its answer and engaged in motion practice in which this issue was not raised. LMSC actively participated in the litigation for months before filing the motion to compel and did not give a reasonable excuse for its delay.

The Court rejects LMSC’s argument that its delay was due to it being unaware of arbitration documents in its possession. The Court also finds that the Plaintiff suffered significant prejudice to its claim while LMSC was litigating the case — the original Plaintiff and crucial witness passed away, and the Plaintiff had to incur substantial expenses in defending LMSC’s motions. LMSC failed to enforce the arbitration agreement promptly and, as a result, waived its rights to do so. The trial court erred in finding otherwise.

Read the full text of this decision.