Document for 12-CA-0032 - Plaintiff Not Entered vs. Defendant Not Entered

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                                Filed on 09/17/2012 03:32 PM in Wayne County, Ohio oy

TIM NEAL, CLERK
WAYNE COUNTY COMMON PLEAS COURT
107 W. LIBERTY ST., PO BOX 507, WOOSTER, OHIO 44691
PHONE: (330) 287-5591 FAX: (330) 287-5416

NINTH DISTRICT COURT OF APPEALS

SEPTEMBER 17, 2012

CASE NO.: CAPTION: FILING:
12-CA-0032 KATHRYN KICK BRIEF FOR APPELLANT
vs. (ORAL ARGUMENT

SMITHVILLE- WESTERN REQUESTED) ...........00008
CARE CENTER ET AL

COPY TO
MAD ALL COUNSEL
Regular

Dep. Clerk, Appeals\

IN THE COURT OF APPEALS, NINTH APPELLATE DISTRICT
APPELLATE COURT CASE NO. 12-CA-0032

WAYNE COUNTY COURT OF COMMON PLEAS
TRIAL COURT CASE NO. 12-CV-0124

KATHRYN KICK, as the personal representative of the Estate of Alice Ritzi (deceased),

Plaintiff-Appellant
vs.
SMITHVILLE WESTERN CARE CENTER, et al., Defendant-Appellees
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BRIEF FOR APPELLANT ™m ey
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ORAL ARGUMENT REQUESTED om yy PAD
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Blake A. Dickson (0059329) Leslie M. Jenny (0067148) a a

Mark D. Tolles, II (0087022)
THE DICKSON FIRM, L.L.C.
Enterprise Place, Suite 420
3401 Enterprise Parkway

Beachwood, Ohio 44122
Telephone: (216) 595-6500
Facsimile: (216) 595-6501
E-Mail:

E-Mail:

Attorneys for Plaintiff-Appellant
Kathryn Kick, as the personal representative
of the Estate of Alice Ritzi (deceased)

MICROFILMED
dul Le 203

+ WAYNE CO. MICROFILM DEPT

BlakeDickson@TheDicksonFirm.com
MarkTolles@TheDicksonFirm.com

SUTTER O’CONNELL CO., L#?A.
3600 Erieview Tower

1301 East 9" Street

Cleveland, Ohio 44114

Telephone: (216) 928-3548
Facsimile: (216) 928-3682
E-Mail: ljenny@sutter-law.com

Attorney for Defendant-Appellees Smithville
Western Care Center, Smithville Western
Care, Inc., Smithville Western, Inc., CMS &
Co. Management Services, Inc., Sprenger
Retirement Centers, Bluesky Healthcare, Inc.,
Bluesky Healthcare, Inc. d.b.a. Sprenger
Enterprises, Inc., Bluesky Healthcare, Inc. d.b.a.
Sprenger Health Care Systems, Bluesky
Healthcare, Inc. d.b.a. Sprenger Retirement
Centers, Sprenger Enterprises, Inc., and Grace
Management Services, Inc.TABLE OF CONTENTS
Table of Cases, Statutes, and Other Authorities ©0000... .. 0. cece cece ee eee eens Page vi
(Assignments Of ETON pte cert eter tee meee ete eee tte tte te
Issues Presented ....... 0... cece ccc e cece e rete eet e een e nett eneeeeeeenes
1 STATEMENT OF THE CASE AND OF THE FACTS ...........0-+ee eee eee Page 3
IL TEA WFANDIARGUMEN GS eters ee ee Page 7
A. Assignment of Error] 0.0.2.0... cece cece eee eee eee eee eens Page 8

THE TRIAL COURT ERRED IN GRANTING THE SPRENGER
DEFENDANTS’ MOTION TO STAY PROCEEDINGS AND
COMPEL ARBITRATION BECAUSE THE HEALTH CARE
CENTER RESIDENCY AGREEMENT AT ISSUE, BY ITS OWN
TERMS, TERMINATED UPON DECEDENT ALICE RITZI’S
DEATH. THEREFORE, THE TRIAL COURT SHOULD NOT
HAVE GIVEN ANY EFFECT TO THE ARBITRATION CLAUSE
CONTAINED WITHIN THAT AGREEMENT

1. Standard of Review ......... 0.2 eee e eee e eee e eee eens Page 8

2. The Trial Court erred in compelling arbitration pursuant to the
arbitration clause contained in Defendant Smithville Western,
Inc.’s Health Care Center Residency Agreement because the
Agreement expressly stated that it terminated upon Alice
Ritzi;sideain tee ie ee er oa Page 9

Issue Number 1: The Health Care Center Residency
Agreement clearly states that it “shall automatically terminate
upon the death of the Resident.” The arbitration clause
contained in Defendant Smithville Western, Inc.’s Health Care
Center Residency Agreement now is void since Alice Ritzi
died on March 1, 2011.0... 6. cece ccc eee Page 9

B. Assignment of Error II ..... 20... cece eee eee eee eect eens Page 13

THE TRIAL COURT ERRED IN GRANTING THE SPRENGER
DEFENDANTS’ MOTION TO STAY PROCEEDINGS AND
COMPEL ARBITRATION AND STAYING ALL PROCEEDINGS
BECAUSE THE HEALTH CARE CENTER RESIDENCY
AGREEMENT AND ITS ARBITRATION CLAUSE DO NOT
APPLY TO PLAINTIFF’S WRONGFUL DEATH CLAIMS. THE

iiTRIAL COURT SHOULD NOT HAVE STAYED PROCEEDINGS
ON PLAINTIFF’S WRONGFUL DEATH CLAIMS AGAINST ANY
OF THE DEFENDANTS.

1. Standard of Review ....... 0... cece cence eee eee e nee

Issue Number 2: Wrongful death claims brought by a
decedent’s next-of-kin are not subject to arbitration based upon
an arbitration agreement entered into by the decedent. Simply
put, a decedent cannot compel his or her heirs to arbitrate their
wrongful death claims. The Trial Court erred in granting
Defendants’ Motion to Stay Proceedings and Compel
Arbitration relative to Plaintiff's wrongful death

Clas! ee

Assignment of Error II]... 0.0.6... cece eee eee nee ences

THE TRIAL COURT ERRED IN GRANTING THE SPRENGER
DEFENDANTS’ MOTION TO STAY PROCEEDINGS AND
COMPEL ARBITRATION AND STAYING ALL PROCEEDINGS
BECAUSE EACH DEFENDANT WAS NOT A PARTY TO THE
HEALTH CARE CENTER RESIDENCY AGREEMENT. THE
TRIAL COURT SHOULD NOT HAVE STAYED PROCEEDINGS
ON PLAINTIFF’S SURVIVAL CLAIMS AGAINST THE
DEFENDANTS WHO WERE NOT PARTIES TO THE
AGREEMENT.

1. Standard of Review ........ 0. cece cece cece ee

Issue Number 3: A contract will not generally bind third parties
who have not entered into the contract. The Health Care
Center Residency Agreement specifically states that it applies
only to Defendant Smithville Western, Inc. and that there are
no actual or intended third party beneficiaries of the
Agreement. The Trial Court erred in determining that the
Health Care Center Residency Agreement applied to
Defendants other than Defendant Smithville Western, Inc. and
in staying Plaintiff's claims against the other

Defendants

Assignment of ErrorIV ........ 00... cece eee eee eee eee nee

THE TRIAL COURT ERRED IN GRANTING THE SPRENGER
DEFENDANTS’ MOTION TO STAY PROCEEDINGS AND
COMPEL ARBITRATION BECAUSE THE ARBITRATION
CLAUSE CONTAINED IN THE HEALTH CARE CENTER

iii

.. Page 14RESIDENCY AGREEMENT AT ISSUE IS PROCEDURALLY AND
SUBSTANTIVELY UNCONSCIONABLE.

1. Standard of Review ....... 0... cece cece cece e eee e eee eens Page 19

2. The Trial Court erred in granting the Smithville Western
Defendants’ Motion to Stay Proceedings and Compel
Arbitration because Defendant Smithville Western, Inc.’s
Health Care Center Residency Agreement is both procedurally
and substantively unconscionable and, therefore,
is not enforceable. ....... 0.6... e cece eee ee eee eee nee Page 19

Issue Number 4: In determining whether an arbitration
agreement is procedurally unconscionable, a court must
consider the circumstances surrounding the contracting parties’
bargaining. The Trial Court erred when it determined that the
terminated Health Care Center Residency Agreement was not
procedurally unconscionable. ......... 0.0 e cece cree eee Page 20

Issue Number 5:In determining whether an arbitration
agreement is substantively unconscionable, a court must
consider whether the terms of the agreement are reasonable.
The Trial Court erred when it did not find that the Health Care
Center Residency Agreement was_ substantively
unconscionable. ....... 2.2... eee cece eee eee eens Page 24

3. The Trial Court erred in granting the Smithville Western
Defendants’ Motion to Stay Proceedings and Compel
Arbitration because the impossibility of the National
Arbitration Forum to conduct the arbitration of Plaintiffs
claims, which was an integral term in Defendant Smithville
Western, Inc.’s Health Care Center Residency Agreement,
renders the Agreement unenforceable ................e sees Page 27

Issue Number 6: The Trial Court erred in ordering arbitration
with the National Arbitration Forum. The selection of the
National Arbitration Forum was an integral term of the
Arbitration Clause. The National Arbitration Forum no longer
participates in consumer arbitration, and, as a result, it is now
impossible for the National Arbitration Forum to conduct the

arbitration of any of Plaintiff's claims. ....................-- Page 27
Ill. CONCIUSIONG ee ee eee Page 29
Certificate of Service 2.2... cece eect eee eee eee ene enneeee Page 30

ivAPPENDIX

Defendant Smithville Western, Inc.’s Health Care Center Residency Agreement......... A-1-10
Affidavit of Kathryn Kick 20.0.0... cece ccc cee eee tenet nnn nenee A-11-13
Trial Court’s Judgment Entry dated May 30, 2012 ......... cece e cece cece eee eens A-14-17
Trial Court’s Judgment Entry dated June 8, 2012 ........ 6. cece eee cence eens A-18

State v. National Arbitration Forum, Inc., Hennepin County (Minn.) District Court
Case No. 27-CV-09-18550 (Consent Judgment Entry dated July 17, 2009) ...... A-19-22TABLE OF CASES, STATUTES AND OTHER AUTHORITIES
ABM Farms Inc. v. Woods, 81 Ohio St.3d 498, 1998-Ohio-612, 692 N.E.2d 574 (1998) . Page 18

Akron v, Frazier, 142 Ohio App.3d 718, 2001-Ohio-2593, 756 N.E.2d 1258

(9 Dist. 2001)... 20. cece eee eee ect e eee cee eee een een n eens Page 10
Akron-Canton Wast Oil, Inc. v. Safety-Kleen Oil Serv., Inc., 81 Ohio App.3d 591,

611 N.E.2d 955 (9" Dist. 1992) ...... ec eee cee cece eee e eee eee ene Page 9
Alexander v. Buckeye Pipe Line Co., 53 Ohio St.2d 241, 374 N.E.2d 146 (1978) ..... Pages 9-10
Ambulatory Care Review Servs., Inc. v. Blue Cross and Blue Shield,

131 Ohio App.3d 450, 722 N.E.2d 1040 (8™ Dist. 1998) ....... 6.0 eee e eee ee Page 18
Ass'n of Cleveland Fire Fighters, Local 93 of the Int’l Ass’n of Fire Fighters v. Cleveland,

2010-Ohio-5597 (8" Dist. 2010)......... 00. ese e eee eee pete eee e eee eees Page 28
AT&T Technologies, Inc. v. Commce’ns Workers of Am., 475 U.S. 643,

106 S.Ct. 1415 (1986) 2... cece cece eee eee e eens Page 18
Ball v. Ohio State Home Servs., Inc., 168 Ohio App.3d 622, 2006-Ohio-4464,

861 N.E.2d 553 (9" Dist. 2006) 00.00... 0 cece eee cece eee e eee e eens Page 20
Belfance v. Standard Oil, 1990 Ohio App. LEXIS 5475 (9" Dist. 1990) .............. Page 11
Blosser v. Enderlin, 113 Ohio St. 121, 148 N.E. 393 (1925) ....... 2. cece cece eee Page 11

Budai v. Euclid Spiral Paper Tube Corp., 1997 Ohio App. LEXIS 189 (9" Dist. 1997) Pages 9,11
Cent. Realty Co. v. Clutter, 62 Ohio St.2d 411, 406 N.E.2d 515 (1980) ............005 Page 12
Cincinnati v. Cameron, 33 Ohio St. 336 (1878) 10.2.6... cece eee eee eee Page 11

Council of Smaller Enters. v. Gates, McDonald & Co., 80 Ohio St.3d 661,
1998-Ohio- 1725087 b-2del352((1998) eee ee ee Pages 14,17-18

Divine Constr. Co. v. Ohio-Am Water Co., 75 Ohio App.3d 311, 599 N.E.2d 388
(10" Dist. 1991) oo... cc ccc cece cece cece cece eee eeeeeeeeeeeeenane Page 18

Harsco Corp. v. Crane Carrier Co., 122 Ohio App.3d 406, 701 N.E.2d 1040
(3 Dist. 1997)... cece cece ce cece teen eee e en ene n ene enenenees Page 9

Hayes v. The Oakridge Home, 122 Ohio St.3d 63, 2009-Ohio-2054,
908 N.E.2d 408 (2009) .. 20... cece cece cece cece eee e ene ees Pages 19-21Johnson v. Mobil Oil Corp., 415 F.Supp. 264 (E.D. Mich. 1976) ...........+0s0000+ Page 20

Kick v. Smithville Western Care Center, Wayne C.P. Case No. 12-CV-0124

(Judgment Entry dated May 30, 2012) ......-.. sec eee cece tence eee nes Page 6
Kick v. Smithville Western Care Center, Wayne C.P. Case No. 12-CV-0124

(Judgment Entry dated June 8, 2012) ...... 0... eee eee eee eee eee eee ene Page 7
Lake Ridge Academy v. Carney, 66 Ohio St.3d 376, 613 N.E.2d 183 (1993) ..........- Page 20
Mahoning Valley Ry. Co. v. Van Alstine, 77 Ohio St. 395, 83 N.E. 601 (1908) ......... Page 15
Marmet Health Care Center v. Brown, 565 U.S. __, 132. S.Ct. 1201 (2012) ......... Page 16
Martin Marietta Magnesia Specialties, L.L.C. v. Pub. Utils. Comm’n of Ohio,

129 Ohio St.3d 485, 201 1-Ohio-4189, 954 N.E.2d 104 (2011) ..........-- Pages 10-12
McGuffey v. LensCrafters, Inc., 2006-Ohio-206 (12" Dist. 2006) ............0eeeeee Page 18

Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614,
105 S.Ct. 3346 (1985)... ccc cece cece eet e teen tence een eaceetes Page 10

Motor Wheel Corp. v. Goodyear Tire & Rubber Co., 98 Ohio App.3d 45,
647 N.E.2d 844 (8 Dist. 1994) 00.0... cece ccc ee cece eee eeee eee eeeee Page 10

Northland Ins. Co. v. Palm Harbor Homes, Inc., 2007-Ohio-1655
(12 Dist. 2007)... . cece cece ence e eee e eee ence eee eee en ee Pages 13-14,17-18

Peters v. Columbus Steel Castings Co., 115 Ohio St.3d 134, 2007-Ohio-4784,
873 N.E.2d 1258 (2007) . 0.0... cece cece cece tenets Pages 14-15,17-18

Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 87 S.Ct. 1801 (1967). ... Page 10
Reynolds v. Lapos Constr., Inc., 2001 Ohio App. LEXIS 2392 (9" Dist. 2001) .......... Page 9

Shifrin v. Forest City Enters., Inc., 64 Ohio St.3d 635, 1992-Ohio-28,
OT NIE 201499 (1992 ieee ste et eter eter Page 11

Small v. HCF of Perrysburg, 159 Ohio App.3d 66, 2004-Ohio-5757,
823 N.E.2d 19 (6" Dist. 2004) ........ 0.0. e cece eee eee eee eee Pages 20-21,24-25

State v. Nat'l Arbitration Forum, Inc., Hennepin County (Minn.) Dist. Court Case
No. 27-CV-09-18550 (Consent Judgment Entry dated July 17,2009) .......... Page 28

viiTaylor Bldg. Corp. of Am. v. Benfield, 117 Ohio St.3d 352, 2008-Ohio-938,
S84) NG 20012) (2008) ee eee eee cee Pages 19-21

Teramar Corp. v. Rodier Corp., 40 Ohio App.3d 39, 531 N.E.2d 721 (8" Dist. 1987) ... Page 18

Terry v. Bishop Homes of Copley, Inc., 2003-Ohio-1468 (9" Dist. 2003) .........+++++ Page 9
Thompson v. Wing, 70 Ohio St.3d 176, 637 N.E.2d 917 (1994) .....-- 0s eee e eee eee Page 15
USS Great Lakes Fleet, Inc. v. Spitzer Great Lakes, Ltd., 85 Ohio App.3d 737,

621 N.E.2d 461 (9" Dist. 1993) 0.0.0... cece cece cece rete ene eens Page 11
Wadsworth Coal Co. v. Silver Creek Min. & Ry. Co., 40 Ohio St. 559 (1884) .......... Page 11
West v. Household Life Ins. Co., 170 Ohio App.3d 463, 2007-Ohio-845,

SG7NE 2d SoS (l02Disi 200) eeu ee ee ee Pages 17,19
Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216, 2003-Ohio-5849,

797 N.E.2d 1256 (2003) .... eee eect tenet eee Pages 11-12,14
OIRI@ G21 251020 ee ee eo Page 14
OIG. S12305 20 ee ee Page 14
ORC S27 Ua ey eee eee ere Page 6
ORIG TS 270 eee ee ee ey Pages 7,20
ORS 2702 ee ee ee Pages 7,9
Restatement of the Law 2d, Contracts, Section 261 (1981) .......... cece eee Page 28

viiiASSIGNMENTS OF ERROR

Assignment of Error I

THE TRIAL COURT ERRED IN GRANTING THE SPRENGER DEFENDANTS’ MOTION TO
STAY PROCEEDINGS AND COMPEL ARBITRATION BECAUSE THE HEALTH CARE
CENTER RESIDENCY AGREEMENT AT ISSUE, BY ITS OWN TERMS, TERMINATED UPON
DECEDENT ALICE RITZI’S DEATH. THEREFORE, THE TRIAL COURT SHOULD NOT HAVE
GIVEN ANY EFFECT TO THE ARBITRATION CLAUSE CONTAINED WITHIN THAT
AGREEMENT.

Assignment of Error II

THE TRIAL COURT ERRED IN GRANTING THE SPRENGER DEFENDANTS’ MOTION TO
STAY PROCEEDINGS AND COMPEL ARBITRATION AND STAYING ALL PROCEEDINGS
BECAUSE THE HEALTH CARE CENTER RESIDENCY AGREEMENT AND ITS
ARBITRATION CLAUSE DO NOT APPLY TO PLAINTIFF’S WRONGFUL DEATH CLAIMS.
THE TRIAL COURT SHOULD NOT HAVE STAYED PROCEEDINGS ON PLAINTIFF’S
WRONGFUL DEATH CLAIMS AGAINST ANY OF THE DEFENDANTS.

Assignment of Error III

THE TRIAL COURT ERRED IN GRANTING THE SPRENGER DEFENDANTS’ MOTION TO
STAY PROCEEDINGS AND COMPEL ARBITRATION AND STAYING ALL PROCEEDINGS
BECAUSE EACH DEFENDANT WAS NOT A PARTY TO THE HEALTH CARE CENTER
RESIDENCY AGREEMENT. THE TRIAL COURT SHOULD NOT HAVE STAYED
PROCEEDINGS ON PLAINTIFF’S SURVIVAL CLAIMS AGAINST THE DEFENDANTS WHO
WERE NOT PARTIES TO THE AGREEMENT.

Assignment of Error IV
THE TRIAL COURT ERRED IN GRANTING THE SPRENGER DEFENDANTS’ MOTION TO
STAY PROCEEDINGS AND COMPEL ARBITRATION BECAUSE THE ARBITRATION
CLAUSE CONTAINED IN THE HEALTH CARE CENTER RESIDENCY AGREEMENT AT
ISSUE IS PROCEDURALLY AND SUBSTANTIVELY UNCONSCIONABLE.

ISSUES PRESENTED
Issue Number 1
The Health Care Center Residency Agreement clearly states that it “shall automatically terminate upon
the death of the Resident.” The arbitration clause contained in Defendant Smithville Western, Inc.’s

Health Care Center Residency Agreement is now void since Alice Ritzi died on March 1, 2011.

Issue Number 2Wrongful death claims brought by a decedent’s next-of-kin are not subject to arbitration based upon
an arbitration agreement entered into by the decedent. Simply put, a decedent cannot compel his or
her heirs to arbitrate their wrongful death claims. The Trial Court erred in granting Defendants’
Motion to Stay Proceedings and Compel Arbitration relative to Plaintiff's wrongful death claims.

Issue Number 3

A contract will not generally bind third parties who have not entered into the contract. The Health
Care Center Residency Agreement specifically states that it only applies to Defendant Smithville
Western, Inc. and that there are no actual or intended third party beneficiaries of the Agreement. The
Trial Court erred in determining that the Health Care Center Residency Agreement applied to
Defendants other than Defendant Smithville Western, Inc. and in staying Plaintiff's claims against the
other Defendants.

Issue Number 4
Indetermining whether an arbitration agreement is procedurally unconscionable, a court must consider
the circumstances surrounding the contracting parties’ bargaining. The Trial Court erred when it

determined that the terminated Health Care Center Residency Agreement was not procedurally
unconscionable.

Issue Number 5
In determining whether an arbitration agreement is substantively unconscionable, a court must consider
whether the terms of the agreement are reasonable. The Trial Court erred when it did not find that the
Health Care Center Residency Agreement was substantively unconscionable.
Issue Number 6
The Trial Court erred in ordering arbitration with the National Arbitration Forum. The selection of
the National Arbitration Forum was an integral term of the Arbitration Clause. The National
Arbitration Forum no longer participates in consumer arbitration, and, as a result, it is now impossible
for the National Arbitration Forum to conduct the arbitration of any of Plaintiff's claims.
I STATEMENT OF THE CASE AND OF THE FACTS.

Alice Ritzi was first admitted to the Smithville Western Care Center nursing home on August
4, 2005, following a ventral hernia. No argument is being made that Alice Ritzi, her daughter Kathryn
Kick, or anyone else signed an admission agreement containing an arbitration clause, relative to this
admission. She was discharged to an assisted living facility on October 10, 2005.

Four years later, on June 16, 2009, Alice Ritzi was admitted to the Wooster Community

2Hospital with a small bowel obstruction caused by another ventral hernia. During her hospital
admission, Alice Ritzi also had an episode of syncope or fainting. Due to her syncope, it was
determined that Alice Ritzi should be discharged to a nursing home, rather than back to an assisted
living facility, so that she could receive adequate supervision and care with her daily activities.

On June 22, 2009, Alice Ritzi was discharged from the Wooster Community Hospital and
admitted to the Smithville Western Care Center nursing home.

Before admitting Alice Ritzi to the Smithville Western Care Center, Defendant Smithville
Western, Inc., by and through its employees and/or agents, required Alice Ritzi’s daughter, Kathryn
Kick, who held a durable power of attorney to act on her mother’s behalf, to sign a Health Care Center
Residency Agreement, a copy of which is attached hereto as Pages A-1-10, as well as other paperwork.
The admission paperwork was placed in front of Kathryn Kick, and she was told that she had to sign
it in order to get her mother, Alice Ritzi, admitted to the Smithville Western Care Center. See
Affidavit of Kathryn Kick, a copy of which is attached hereto as Pages A-1 1-13, at 21, 29, 33, and
44. Defendant Smithville Western, Inc.’s Health Care Center Residency Agreement was a ten (10)
page document. On Page 8 of the Health Care Center Residency Agreement, following a section of
miscellaneous, boilerplate provisions, was an arbitration clause. The admission paperwork, including
the Defendant Smithville Western, Inc.’s Health Care Center Residency Agreement, was drafted by
and provided to Kathryn Kick by Defendant-Appellees Smithville Western Care Center, Smithville
Western Care, Inc., Smithville Western, Inc. CMS & Co. Management Services, Inc., Sprenger
Retirement Centers, Bluesky Healthcare, Inc., Bluesky Healthcare, Inc. d.b.a. Sprenger Enterprises,
Inc., Bluesky Healthcare, Inc. d.b.a. Sprenger Health Care Systems, Bluesky Healthcare, Inc. d.b.a.
Sprenger Retirement Centers, Sprenger Enterprises, Inc., and Grace Management Services, Inc.
(hereafter referred to collectively as the “Sprenger Defendants”). /d. at J§ 15 and 19.

3Kathryn Kick was 73 years old when her mother, Alice Ritzi, was admitted to the Smithville
Western Care Center on June 22, 2009. Jd. at | 9. Kathryn Kick is not an attorney. Id. at 39. She
does not have any formal education beyond high school. Jd. at] 10. She does not have any experience
with litigation, arbitration, nor drafting and negotiating contracts. Jd. at JJ 12, 34, 38, and 40. She
does not know the difference between arbitration and litigation. Id. at § 14. She does not really know
what arbitration is or how it works. Jd. at J 13.

When Kathryn Kick signed the admission paperwork, she was worried about her mother’s
health and safety and simply wanted to get her mother admitted to the Smithville Western Care Center,
so that her mother could receive the care and supervision that she needed. Jd. at J] 22, 23, 24, and 25.
Kathryn Kick signed the paperwork over the course of a few minutes, as directed by an employee
and/or agent of the Defendants who conducted the admission process for Alice Ritzi’s admission to
the Smithville Western Care Center. Jd. at { 27.

Kathryn Kick only intended to sign paperwork that would enable her mother to be admitted
to the Smithville Western Care Center. Jd. at §§ 2 and 16. No one at the Smithville Western Care
Center ever told Kathryn Kick that the admission paperwork that she was required to sign had anything
to do with arbitration or litigation. Jd. at {| 30. Kathryn Kick did not read the paperwork. Id. at § 28.
She did not make any changes to the paperwork, nor was she ever told that she could make any
changes to the paperwork and still have her mother admitted to the Smithville Western Care Center.
Id, at JJ 18, 20, 42, and 43.

No one at the Smithville Western Care Center ever explained to Kathryn Kick the difference
between arbitration and litigation. Jd. at 45. No one ever mentioned nor explained to Kathryn Kick
that if she signed the admission paperwork that her mother would be waiving her right to a jury trial
if she received substandard care at the Smithville Western Care Center and ever decided to sue the

4owners and operators of the Smithville Western Care Center for such negligence. Id. at 35. No one
ever explained to Kathryn Kick or gave her or her mother, any choice relative to whether Alice Ritzi
would want to be able to sue the owners and operators of the Smithville Western Care Center if they
provided her substandard care or whether she would want to waive her right to a jury trial and arbitrate
such a claim. Jd. at §] 6 and 17. Kathryn Kick never bargained with anyone over the arbitration
provision in the Health Care Center Residency Agreement. Id. at { 36. She did not even know that
such a provision even existed. Id. at { 36. 7

No one at the Smithville Western Care Center ever mentioned arbitration to Kathryn Kick
during the admission process nor at any time during the next twenty (20) months of Alice Ritzi’s
residency there. Jd. at 3. When Kathryn Kick signed the Health Care Center Residency Agreement,
she had no idea that she was signing any document that had anything to do with arbitration. Id. at J
11. She had no idea that she was signing any document that would waive her mother’s right to a jury
trial. Id. at 94.

When Kathryn Kick signed the admission paperwork on behalf of her mother, including the
Health Care Center Residency Agreement, she was never told that she could have an attorney present.
Id. at | 32. Nor was she ever told that she could have an attorney review the paperwork before she
signed it. Jd. at 32. Kathryn Kick did not have an attorney present when she signed the admission
paperwork. Id, at § 31.

On June 22, 2009, when Alice Ritzi was admitted to the Smithville Western Care Center, she
was 93 years old.

On February 18, 2011, two employees of the Smithville Western Care Center were transferring
Alice Ritzi using a Hoyer lift when they dropped her. Asa result of the negligence and/or recklessness
of the Defendants, by and through their employees, Alice Ritzi suffered severe, permanent injuries,

>including a broken hip, and she ultimately died as a direct and proximate cause of these injuries on
March 1, 2011.

On February 17, 2012, Plaintiff Kathryn Kick, as the personal representative of the Estate of
Alice Ritzi (deceased), filed a Complaint in the Wayne County Court of Common Pleas against the
Sprenger Defendants, as well as Defendants Therapy Partners, Inc., Wallace Management Corporation
d.b.a. Therapy Partners, and Infinity Health Care, L.L.C. d.b.a. Infinity, NP.’

On March 21, 2012, the Sprenger Defendants filed a Motion to Stay Proceedings and
Compel/Enforce Arbitration pursuant to R.C. § 2711.

On March 26, 2012, the Sprenger Defendants filed a joint Answer.

On April 13, Plaintiff Kathryn Kick filed a Brief in Opposition to the Sprenger Defendants’
Motion to Stay Proceedings and Compel/Enforce Arbitration.

On April 23, 2012, the Sprenger Defendants filed a Reply Brief in Support of Their Motion
to Stay Proceedings and Compel/Enforce Arbitration.

On May 23, 2012, Plaintiff Kathryn Kick filed a Motion for Leave to File Sur Reply Brief,
Instanter, in Response to the Sprenger Defendants’ Reply Brief.

On May 30, 2012, the Trial Court issued a Judgment Entry granting the Sprenger Defendants’
Motion to Stay Proceedings and Compel/Enforce Arbitration, a copy of which is attached hereto as
Pages A-14-17, and stayed all of Plaintiff's claims against all of the Defendants pending arbitration.

On June 5, 2012, Plaintiff filed a Motion for Reconsideration of the Trial Court’s Order

Staying All of Plaintiff's Claims Pending Arbitration.

' On May 1, 2012, Plaintiff and Defendant Infinity Health Care, L.L.C. d.b.a. Infinity, NP
filed a Joint Notice of Dismissal Without Prejudice, dismissing Defendant Infinity Health Care,
L.L.C. d.b.a. Infinity, NP. All of the other Defendants remain parties in the underlying case.

6On June 8, 2012, the Trial Court issued a Judgment Entry denying Plaintiff's Motion for
Reconsideration of Court’s Order Staying All of Plaintiff's Claims Pending Arbitration, a copy of
which is attached hereto as Page A-18.

On June 26, 2012, Plaintiff-Appellant Kathryn Kick timely filed a Notice of Appeal, pursuant
to O.R.C. § 2711.02(C), appealing from the Trial Court’s May 30, 2012 Judgment Entry.

I. LAW AND ARGUMENT.

The Sprenger Defendants moved the Trial Court to stay all proceedings pending arbitration on
all of Plaintiff's claims in this case, pursuant to O.R.C. § 2711, based upon the arbitration clause
contained in the Health Care Center Residency Agreement that Defendant Smithville Western, Inc.
only and Plaintiff Kathryn Kick, as the attorney-in-fact for Decedent Alice Ritzi, entered into prior to
Alice Ritzi’s admission to the Smithville Western Care Center.

O.R.C. § 2711.02 permits a party to request-a stay of proceedings when an “action is brought
upon any issue referable to arbitration under an agreement in writing for arbitration”. O.R.C. §
2711.02(B) states, as follows:

(B) If any action is brought upon any issue referable to arbitration under an agreement

in writing for arbitration, the court in which the action is pending, upon being satisfied

that the issue involved in the action is referable to arbitration under an agreement in

writing for arbitration, shall on application of one of the parties stay the trial of the

action until the arbitration of the issue has been had in accordance with the agreement,

provided the applicant for the stay is not in default in proceeding with arbitration.

O.R.C. § 2711.01(A) states that arbitration clauses in written contracts are generally valid and
enforceable, subject to several statutory exceptions as well as “grounds that exist at law or in equity
for the revocation of any contract.”

Defendant Smithville Western, Inc.’s Health Care Center Residency Agreement, including the

arbitration clause contained therein, is invalid and unenforceable against the Estate of Alice Ritzi(deceased) and Alice Ritzi’s heirs for several reasons.

First, the express language of the Health Care Center Residency Agreement clearly states that
the Agreement, including the arbitration clause, automatically terminated upon the death of Alice Ritzi
which occurred on March 1, 2011, long before the Complaint in this case was even filed on February
17, 2012.

Second, even if the express language of the Health Care Center Residency Agreement did not
clearly state that the Agreement, including the arbitration clause, automatically terminated upon the
death of Alice Ritzi, the agreement only has the capacity to bind Alice Ritzi. No one who signed the
agreement had the authority to bind Alice Ritzi’s heirs. So there is no argument that the agreement
could possibly apply to the wrongful death claims in this case.

Third Defendant Smithville, Inc. is the only Defendant that is a party to the arbitration
agreementat issue. Therefore, Kathryn Kick’s survival claims against the other Defendants in this case
are not subject to the arbitration clause so they could not possibly be stayed by it.

Fourth, the arbitration clause is both procedurally and substantively unconscionable and, as a
result, it is not enforceable.

Fifth, it is undisputed that the selected forum, the National Arbitration Forum, is no longer
available to arbitrate any claims brought pursuant to the Health Care Center Residency Agreement.
Since the selection of the National Arbitration Forum is an integral term of the arbitration agreement,
the unavailability of the National Arbitration Forum renders the arbitration agreement unenforceable
due to impossibility of performance.

For all of these reasons, the Trial Court erred in granting the Sprenger Defendants’ Motion to
Stay Proceedings and Compel Arbitration. Accordingly, Kathryn Kick respectfully requests that this
Honorable Court reverse the Trial Court’s Judgment Entry staying all proceedings in this case on all

8of Kathryn Kick’s claims.

This Court has jurisdiction to review the Trial Court’s Judgment Entry granting the Sprenger
Defendants’ Motion to Stay Proceedings and Compel Arbitration on all of Plaintiff's claims pursuant
to O.R.C. § 2711.02(C), which states that an order “that grants or denies a stay of a trial of any action
pending arbitration * * * is a final order and may be reviewed, affirmed, modified, or reversed on
appeal”.

A. Assignment of Error I.

THE TRIAL COURT ERRED IN GRANTING THE SPRENGER DEFENDANTS’ MOTION TO
STAY PROCEEDINGS AND COMPEL ARBITRATION BECAUSE THE HEALTH CARE
CENTER RESIDENCY AGREEMENT AT ISSUE, BY ITS OWN TERMS, TERMINATED UPON
DECEDENT ALICE RITZI’S DEATH. THEREFORE, THE TRIAL COURT SHOULD NOT HAVE
GIVEN ANY EFFECT TO THE ARBITRATION CLAUSE CONTAINED WITHIN THAT
AGREEMENT.

1. Standard of Review.

“Generally, in determining whether the trial court properly denied or granted a motion to stay
proceedings pending arbitration, the standard of review is whether the order constituted an abuse of
discretion.” Terry v. Bishop Homes of Copley, Inc., 2003-Ohio-1468, at { 10 (9" Dist. 2003), citing
Reynolds v. Lapos Constr., Inc., 2001 Ohio App. LEXIS 2392 (9" Dist. 2001) and Harsco Corp. v.
Crane Carrier Co., 122 Ohio App.3d 406, 410, 701 N.E.2d 1040 (3" Dist. 1997), appeal not allowed,
80 Ohio St.3d 1477, 687 N.E.2d 473 (1997).

“When an appellate court is presented with purely legal questions, however, the standard of
review to be applied is de novo.” Terry, 2003-Ohio-1468, at { 11, citing Akron-Canton Waste Oil, Inc.
v. Safety-Kleen Oil Serv., Inc., 81 Ohio App.3d 591, 602, 611 N.E.2d 955 (9" Dist. 1992). “The

construction of a written contract is a legal question,” which is subject to de novo review. Budai v.

Euclid Spiral Paper Tube Corp., 1997 Ohio App. LEXIS 189, at * 28 (9" Dist. 1997), citing Alexanderv. Buckeye Pipe Line Co., 53 Ohio St.2d 241, 374 N.E.2d 146, paragraph one of the syllabus (1978).
“Under the de novo standard of review, an appellate court does not give deference to a trial court’s
decision.” Terry, 2003-Ohio-1468, at § 11, citing Akron v. Frazier, 142 Ohio App.3d 718, 721, 2001-
Ohio-2593, 756 N.E.2d 1258 (9" Dist. 2001).
2. The Trial Court erred in compelling arbitration pursuant to the
arbitration clause in Defendant Smithville Western, Inc.’s Health Care
Center Residency Agreement because the Agreement expressly stated that
it terminated upon Alice Ritzi’s death.
Issue Number 1: The Health Care Center Residency Agreement clearly states that it “shall
automatically terminate upon the death of the Resident.” The arbitration clause contained in Defendant

Smithville Western, Inc.’s Health Care Center Residency Agreement is now void since Alice Ritzi died
on March 1, 2011.

Pursuant to its express terms, Defendant Smithville Western, Inc.’s Health Care Center
Residency Agreement, including the arbitration clause contained therein, automatically terminated on
March 1, 2011 upon Alice Ritzi’s death. Since the Agreement terminated on March 1, 2011, it was
not in effect on March 21, 2012 when the Sprenger Defendants filed their Motion to Stay Proceedings
and Compel Arbitration.

It is well recognized that “arbitration is a creature of contract.” Motor Wheel Corp. v.
Goodyear Tire & Rubber Co., 98 Ohio App.3d 45, 52, 647 N.E.2d 844 (8" Dist. 1994). Arbitration
agreements should be “as enforceable as other contracts, but not more so.” Prima Paint Corp. v. Flood
& Conklin Mfg. Co., 388 U.S. 395, 405 n. 12, 87 S.Ct. 1801 (1967). As a result, “the first task of a
court asked to compel arbitration of a dispute is to determine whether the parties agreed to arbitrate
that dispute.” Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 626, 105 S.Ct.
3346 (1985). “When confronted with an issue of contract interpretation, the role of the court is to give
effect to the intent of the parties to that agreement. The court examines the contract as a whole and
presumes that the intent of the parties is reflected in the language used in the agreement.” Martin

10Marietta Magnesia Specialties, L.L.C. v. Pub. Utils. Comm’n of Ohio, 129 Ohio St.3d 485, 490, 2011-
Ohio-4189, 954 N.E.2d 104 (2011), citing Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216, 219,
2003-Ohio-5849, 797 N.E.2d 1256 (2003). “[T]he terms of a written contract are to be ascertained
from the language of the agreement, and no implication inconsistent with the express terms therein
may be inferred.” Belfance v. Standard Oil, 1990 Ohio App. LEXIS 5475, at * 8 (9" Dist. 1990).
“When the language of a written contract is clear, a court may look no further than the writing itself
to find the intent of the parties.” Martin Marietta Magnesia Specialties, L.L.C., 129 Ohio St.3d at 490,
citing Westfield Ins. Co., 100 Ohio St.3d at 219.

“Contract provisions that are unambiguous must be construed according to the plain, express
terms.” Budai, 1997 Ohio App. LEXIS 189, at * 29, citing USS Great Lakes Fleet, Inc. v. Spitzer
Great Lakes, Ltd., 85 Ohio App.3d 737, 741, 621 N.E.2d 461 (9" Dist. 1993). “When a written
contract is plain and unambiguous, it does not become ambiguous by reason of the fact that its
operation will work a hardship on one party and accord advantage to the other.” Belfance v. Standard
Oil, 1990 Ohio App. LEXIS 5475, at * 8-9 (9" Dist. 1990).

“A court * * * is not permitted to alter a lawful contract by imputing an intent contrary to that
expressed by the parties.” Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216, 219, 2003-Ohio-5849,
797 N.E.2d 1256 (2003), citing Shifrin v. Forest City Enters., Inc., 64 Ohio St.3d 635, 1992-Ohio-28,
597 N.E.2d 499 (1992) and Blosser v. Enderlin, 113 Ohio St. 121, 148 N.E. 393, paragraph one of the
syllabus (1925). “Additionally, all terms in a contract should be given effect whenever possible.”
Budai, 1997 Ohio App. LEXIS 189, at * 28-29 (emphasis in original), citing Wadsworth Coal Co. v.
Silver Creek Min. & Ry. Co., 40 Ohio St. 559, paragraph one of the syllabus (1884). “The contract
under consideration should be construed reasonably, so as not to arrive at absurd results. Budai, 1997
Ohio App. LEXIS 189, at * 28, citing Cincinnati v. Cameron, 33 Ohio St. 336, 364 (1878). “[W]here

11the written contract is standardized and between the parties of unequal bargaining power, an ambiguity
in the writing will be interpreted strictly against the drafter and in favor of the nondrafting party.”
Westfield Ins. Co., 100 Ohio St.3d at 220, citing Cent. Realty Co. v. Clutter, 62 Ohio St.2d 411, 413,
406 N.E.2d 515 (1980).

In Martin Marietta Magnesia Specialties, L.L.C. v. Pub. Utils. Comm'n of Ohio, 129 Ohio
St.3d 485, 2011-Ohio-4189, 954 N.E.2d 104 (2011), the Supreme Court of Ohio was asked to
determine the termination date of special contracts between corporations and their public utility
company, Toledo Edison. The corporations contended that their special contracts “would terminate
on the date that Toledo Edison ceased its collection of regulatory-transition charges, i.e., December
31, 2008", pursuant to the express terms of the contracts. Jd. at 489. However, Toledo Edison
terminated the contracts in February of 2008. Toledo Edison claimed that the parties had agreed to
a termination date “that tied regulatory-transition charges to Toledo Edison’s distribution sales”, such
that the contracts would terminate “when Toledo Edison’s distribution sales reach a certain level.” Id.
at 490. Finding that the language of the contracts was clear and unambiguous and expressly stated that
the contracts “shall terminate with the bill rendered for the electric usage through the date which [the
regulatory-transition charge] ceases for the [Toledo Edison] Company”, the Court held that the
contracts were supposed to terminate on December 31, 2008 when Toledo Edison stopped collecting
its regulatory-transition charges. Jd. The Court found that, pursuant to the express terms of the
contracts, the corporations and Toledo Edison had agreed that the contracts would terminate on this
date, not on some other date when Toledo Edison’s distribution sales reached a certain level.
Therefore, the express language of the termination clauses in the contracts controlled.

In this case, it is clear that the Health Care Center Residency Agreement automatically
terminated upon Alice Ritzi’s death on March 1, 2011. Section III(B) of the Agreement states, in

12pertinent part, “This Agreement shall automatically terminate upon the death of the Resident.” It is
not in dispute that “Resident” refers to Alice Ritzi. As a result, the Health Care Center Residency
Agreement, including the arbitration clause contained therein, terminated on March 1, 2011 and should
not be given any effect by this Court nor the Trial Court. The Agreement was drafted exclusively by
the Defendants. If Defendant Smithville Western, Inc. desired the arbitration clause to remain in effect
after Alice Ritzi’s death and the termination of other obligations reflected in the Agreement, it could
have easily included a provision to that effect. However, it did not. The only reasonable conclusion,
which is supported by the express terms of the Agreement, is that the Agreement terminated on March
1, 2011. Therefore, there is no basis to stay any of Plaintiff Kathryn Kick’s claims pursuant to the
Sprenger Defendants’ Motion to Stay Proceedings and Compel Arbitration, which was filed on March
21, 2012, over one (1) year after the Agreement and arbitration clause had terminated.

Accordingly, Kathryn Kick respectfully requests that this Honorable Court reverse the Trial
Court’s decision, which stayed all of Plaintiff's claims pending arbitration pursuant to an Agreement
that had automatically terminated upon the death of Alice Ritzi and should not have been given any
effect at a later date.

B. Assignment of Error II.
THE TRIAL COURT ERRED IN GRANTING THE SPRENGER DEFENDANTS’ MOTION TO
STAY PROCEEDINGS AND COMPEL ARBITRATION AND STAYING ALL PROCEEDINGS
BECAUSE THE HEALTH CARE CENTER RESIDENCY AGREEMENT AND _ ITS
ARBITRATION CLAUSE DO NOT APPLY TO PLAINTIFF’S WRONGFUL DEATH CLAIMS.
THE TRIAL COURT SHOULD NOT HAVE STAYED PROCEEDINGS ON PLAINTIFF’S
WRONGFUL DEATH CLAIMS AGAINST ANY OF THE DEFENDANTS.

1. Standard of Review.

“Interpreting the meaning and construction of contracts * * * involves a question of law which

appellate courts review de novo.” Northland Ins. Co. v. Palm Harbor Homes, Inc.,2007-Ohio-1655,

13at {7 (12" Dist. 2007), citing West v. Household Life Ins. Co., 170 Ohio App.3d 463, 2007-Ohio-845,
867 N.E.2d 868 (10" Dist. 2007). “In addition, the question of whether a particular claim is arbitrable
is one of law for the court to decide.” Northland Ins. Co., 2007-Ohio-1655, at { 7, citing Council of
Smaller Enterprises v. Gates, McDonald & Co., 80 Ohio St.3d 661, 666, 1998-Ohio-172, 687 N.E.2d
1352 (1998). Accordingly, this Court should review whether the Health Care Center Residency
Agreement and its arbitration clause apply to Plaintiff Kathryn Kick’s wrongful death claims against
any of the Defendants in this case under a de novo standard of review.
Issue Number 2: Wrongful death claims brought by a decedent’s next-of-kin are not subject to
arbitration based upon an arbitration agreement entered into by the decedent. Simply put, a decedent
cannot compel his or her heirs to arbitrate their wrongful death claims. The Trial Court erred in
granting Defendants’ Motion to Stay Proceedings and Compel Arbitration relative to Plaintiff's
wrongful death claims.

The Trial Court erred in granting the Sprenger Defendants’ Motion to Stay Proceedings and
Compel Arbitration relative to the wrongful death claims against the Defendants.

In Peters v. Columbus Steel Castings Co., 115 Ohio St.3d 134, 2007-Ohio-4784, 873 N.E.2d
1258 (2007), the Supreme Court of Ohio considered the issue of “whether the personal representative
of a decedent’s estate is required to arbitrate a wrongful-death claim when the decedent had agreed to
arbitrate all claims against the alleged tortfeasor.” Peters, 115 Ohio St.3d at 135. In considering this
issue, the Court reviewed the separate nature of survival claims and wrongful death claims. The Court
stated that “when an individual is killed by the wrongful act of another, the personal representative of
the decedent’s estate may bring a survival action for the decedent's own injuries leading to his or her
death as well as a wrongful-death action for the injuries suffered by the beneficiaries of the decedent
as a result of the death.” Peters, 115 Ohio St.3d at 137 (emphasis in original); See also O.R.C. §§
2125.02 and 2305.21, which provide separate causes of action for wrongful death claims and survival

claims respectively. The Ohio Supreme Court recognized that although survival claims and wrongful

14death claims both relate to the same allegedly negligent acts of a defendant, and that such claims are
often pursued by the same nominal party (i.e., the personal representative of the estate) in the same
case, they are distinct claims that are brought by different parties in interest. Peters, 115 Ohio St.3d
at 137, citing Mahoning Valley Ry. Co. v. Van Alstine, 77 Ohio St. 395, 414, 83 N.E. 601 (1908). As
a result of the different nature of wrongful death claims from survival claims, the Court held that “a
decedent cannot bind his or her beneficiaries to arbitrate their wrongful-death claims. The
beneficiaries can agree to arbitrate these claims themselves, but they are not required to do so. Because
Peter’s beneficiaries did not sign the plan or any other dispute-resolution agreement, they cannot be
forced into arbitration.” Peters, 115 Ohio St.3d at 138, citing Thompson v. Wing, 70 Ohio St.3d 176,
182-83, 637 N.E.2d 917 (1994). Simply put, the Court concluded that “[a]lthough we have long
favored arbitration and encourage it as a cost-effective proceeding that permits parties to achieve
permanent resolution of their disputes in an expedient manner, it may not be imposed on the
unwilling.” Peters, 115 Ohio St.3d at 138. The Court went on to state that “[rlequiring Peters’s
beneficiaries to arbitrate their wrongful-death claims without a signed arbitration agreement would be
unconstitutional, inequitable, and in violation of nearly a century’s worth of established precedent.”
Peters, 115 Ohio St.3d at 138-39.

The holding and reasoning in Peters apply to the wrongful death claims which have been
brought by Plaintiff Kathryn Kick on behalf of Decedent Alice Ritzi’s next-of-kin. Even if the Health
Care Center Residency Agreement, and the arbitration clause contained within it, had not automatically
terminated upon Decedent Alice Rotzi’s death, the wrongful death claims in this case are not subject
to arbitration pursuant to that Agreement. As a result, there was no basis for the Trial Court to stay
the wrongful death claims in this case.

Kathryn Kick signed the Health Care Center Residency Agreement only in her capacity as

15attorney-in-fact for Alice Ritzi. The only parties to the now terminated Health Care Center Residency
Agreement were Decedent Alice Ritzi and Defendant Smithville Western, Inc. None of Alice Ritzi’s
next-of-kin were ever a party to the Health Care Center Residency Agreement so they cannot possibly
be bound by it.

The Smithville Defendants will likely argue that the Supreme Court of the United States’
decision in Marmet Health Care Center v. Brown, 565 U.S.___, 132 S.Ct. 1201 (2012) supports their
position that wrongful death claims are subject to arbitration. Nothing in Marmet holds that a Nursing
Home resident can bind his or her next of kin. Ohio law, as set forth in Peters, makes it clear that a
resident cannot bind his or her heirs to arbitration. What Marmet stands for is the proposition that
arbitration agreements must be treated like all other contracts and they cannot be singled out. In
Marmet the West Virginia Supreme Court singled arbitration agreements out on public policy grounds.
The Supreme Court of the United States held that such treatment was not valid. However, the Court
stated, “On remand, the West Virginia court must consider whether, absent that general public policy,
the arbitration clauses in Brown’s case and Taylor’s case are unenforceable under state common law
principles that are not specific to arbitration and pre-empted by the FAA.” Marmet, 565 U.S.___,
at * 5. As a result, it is clear that an arbitration agreement may be invalidated on state law grounds.
It is also clear that in Ohio the law is clear, a Decedent cannot bind her heirs to arbitration.

Accordingly, Kathryn Kick respectfully requests that this Honorable Court reverse the Trial
Court’s decision, which stayed Plaintiff's wrongful death claims pending arbitration.

Cc. Assignment of Error III.

THE TRIAL COURT ERRED IN GRANTING THE SPRENGER DEFENDANTS’ MOTION TO
STAY PROCEEDINGS AND COMPEL ARBITRATION AND STAYING ALL PROCEEDINGS
BECAUSE EACH DEFENDANT WAS NOT A PARTY TO THE HEALTH CARE CENTER
RESIDENCY AGREEMENT. THE TRIAL COURT SHOULD NOT HAVE STAYED
PROCEEDINGS ON PLAINTIFF’S SURVIVAL CLAIMS AGAINST THE DEFENDANTS WHO

16WERE NOT PARTIES TO THE AGREEMENT.

1. Standard of Review.

“Interpreting the meaning and construction of contracts * * * involves a question of law which
appellate courts review de novo.” Northland Ins. Co. v. Palm Harbor Homes, Inc.,2007-Ohio-1655,
at] 7 (12" Dist. 2007), citing West v. Household Life Ins. Co., 170 Ohio App.3d 463, 2007-Ohio-845,
867 N.E.2d 868 (10" Dist. 2007). “In addition, the question of whether a particular claim is arbitrable
is one of law for the court to decide.” Northland Ins. Co., 2007-Ohio-1655, at J 7, citing Council of
Smaller Enterprises v. Gates, McDonald & Co., 80 Ohio St.3d 661, 666, 1998-Ohio-172, 687 N.E.2d
1352 (1998). Accordingly, this Court should review whether the Health Care Center Residency
Agreement and its arbitration clause apply to Plaintiff Kathryn Kick’s survival claims against
Defendants other than Defendant Smithville Western, Inc. under a de novo standard of review.
Issue Number 3: A contract will not generally bind third parties who have not entered into the
contract. The Health Care Center Residency Agreement specifically states that it applies only to
Defendant Smithville Western, Inc. and that there are no actual or intended third party beneficiaries
of the Agreement. The Trial Court erred in determining that the Health Care Center Residency
Agreement applied to Defendants other than Defendant Smithville Western, Inc. and in staying
Plaintiff's claims against the other Defendants.

The terminated Health Care Center Residency Agreement does not apply to any Defendant
other than Smithville Western, Inc., as the other Defendants are not parties to the Health Care Center
Residency Agreement.

In Peters v. Columbus Steel Castings Co., 115 Ohio St.3d 134, 136, 2007-Ohio-4784, 873
N.E.2d 1258 (2007), the Supreme Court of Ohio recognized that it is a longstanding general principle
of law that “only signatories to an arbitration agreement are bound by its terms”. The Court recognized

that “there is no dispute that ‘arbitration is a matter of contract and a party cannot be required to submit

to arbitration any dispute which he has not agreed so to submit.” Peters, 115 Ohio St.3d at 136,

17quoting Council for Smaller Enters. v. Gates, McDonald & Co., 80 Ohio St.3d at 665. “Despite the
strong policy in favor of arbitration, a matter that does not fall within the ambit of an arbitration
agreement should not be submitted to mandatory arbitration.” Northland Ins. Co. v. Palm Harbor
Homes, Inc., 2007-Ohio-1655, at J 9, c