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Liberty Health & Rehab of Indianola, LLC v. Howarth

United States District Court, N.D. Mississippi, Delta Division

April 11, 2014

LIBERTY HEALTH & REHAB OF INDIANOLA, LLC, PLAINTIFF
v.
JOIE DORRIS PEACOCK HOWARTH, AS THE SOLE WRONGFUL DEATH BENEFICIARY OF GEORDIE DORRIS PEACOCK, DECEASED, AND AS EXECUTRIX OF THE ESTATE OF GEORDIE DORRIS PEACOCK, DECEASED, DEFENDANT

For Liberty Health & Rehab of Indianola, LLC, Plaintiff: William W. (Whit) McKinley , Jr., LEAD ATTORNEY, Lilli Evans Bass, CURRIE, JOHNSON, GRIFFIN, GAINES & MYERS, Jackson, MS.

For Joie Dorris Peacock Howarth, As the sole Wrongful Death beneficiary of Geordie Dorris Peacock, Deceased, and as Executrix of the Estate of Geordie Dorris Peacock, Deceased, Defendant: John K. Povall, LEAD ATTORNEY, J. KIRKHAM POVALL, ATTORNEY, Cleveland, MS; Steven Todd Jeffreys, William Hunter Nowell, POVALL & JEFFREYS, PA, Cleveland, MS.

Page 685

ORDER

MICHAEL P. MILLS, CHIEF UNITED STATES DISTRICT JUDGE.

On February 10, 2014, this court conducted a bench trial in the above-entitled action, and it is now prepared to render its final verdict. This is an arbitration case which plaintiff Liberty Health & Rehab of Indianola, LLC filed, under the Federal Arbitration Act, seeking to compel arbitration of a dispute which is presently being litigated in a wrongful death lawsuit in Mississippi state court. That underlying state court action involves claims arising out of the death of Geordie Peacock (" the decedent" ), who, on July 26, 2011, was admitted as a resident at a nursing home operated by Liberty Health. That same day, the decedent signed an arbitration agreement which all parties agree, if valid and enforceable, bars the wrongful death action in state court. Defendant argues, however, that the arbitration agreement is not enforceable, since the decedent did not have mental capacity at the time he signed the agreement.

At trial, this court had two issues before it: 1) whether plaintiff had proven by a preponderance of the evidence that an agency relationship existed between the decedent and his live-in girlfriend Linda Stanfield (who also signed the arbitration agreement) and 2) whether defendant had proven that the decedent lacked mental capacity at the time he signed the arbitration agreement. As discussed in the court's summary judgment order, the burden of proof is unclear with regard to the second issue, but it will assume for the sake of argument that, under Mississippi law, defendant must prove lack of capacity by clear and convincing evidence. With regard to the agency issue, this court entered a verdict at trial in favor of defendant, and, in so doing, it made findings of fact, which it reiterates here, that defendant had presented credible testimony from Ms. Stanfield that no agency relationship existed between herself and the decedent.

With regard to the competency issue, the court indicated in an order entered on January 12, 2014 (i.e., two days after trial) that it had concluded, based on the evidence

Page 686

at trial, that the decedent did not have the mental competency to enter into an arbitration agreement. The court concluded in that order, however, that it had improperly limited the trial testimony of defendant's expert, Nurse Susan P. Lofton, and that defendant should be given an opportunity to conduct a post-trial deposition of this witness so that this case would have a complete factual record for any appeal. The parties have now taken Nurse Lofton's deposition, and they have submitted a transcript of her testimony, along with plaintiff's objections to same. Having reviewed these submissions, the court finds that Nurse Lofton's views regarding Mr. Peacock's competency are similar to its own, but it reiterates once again that it has not relied primarily upon the post-litigation views of experts from either side in concluding that the decedent lacked competency to enter into an arbitration agreement.

In explaining its limited reliance upon the post-litigation testimony from experts for either side, this court wrote in its February 12, 2014 order as follows:

This court never doubted that both sides would be able to find a paid or interested witness to offer an opinion that the decedent in this case either was or was not competent to sign an arbitration agreement. This court subjectively knew, however, that it would not base its eventual ruling primarily upon such after-the-fact expert testimony, even though, as explained in the order quoted above, it does place very considerable weight upon the contemporaneous medical reports prepared by Nurse Smith. For reasons which should be obvious, contemporaneous medical records prepared by experienced professionals with no contemplation of litigation are generally far more probative than after-the-fact opinions offered by paid or interested experts.

(February 12, 2014 order at 3-4).

In its pre-trial order denying summary judgment, this court similarly indicated that it viewed the contents of Nurse Joyce Smith's contemporaneous medical examination of the decedent to be the most important evidence in this case: Specifically, the court wrote as follows in its summary judgment order:

At this juncture, this court is inclined to place considerably greater weight upon the contemporaneous medical records of Nurse Smith than upon paid or interested expert testimony from either side. Nurse Smith was plaintiff's own employee, and she was assigned the task of evaluating the decedent's mental state at the time of his admission to the nursing home. Presumably, plaintiff will not argue that it assigned this important responsibility to an employee who was not equal to the task. Just as important as Nurse Smith's credentials, in the court's view, is the fact that the objectivity of her contemporaneous records is not in any doubt. It is undisputed that Nurse Smith was simply performing a routine medical examination without any knowledge or consideration of how the results of that examination might be used in a future lawsuit. In arguing that the decedent was competent to sign an arbitration agreement, plaintiff relies upon the testimony of his treating physician Dr. Darrell Jee. However, this doctor's testimony is hardly objective, since he is presently a ...

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