Alterra Healthcare Corp. v. Bryant, 937 So. 2d 263 (Fla. 4th DCA 2006)

Both parties appealed after the court severed limitations on damages but compelled arbitration. In 2004, Plaintiff filed suit for negligence and violations of the Assisted Living Facilities Act. Alterra moved to compel arbitration because the resident’s agent, who held a power of attorney, signed the Residency Agreement containing an arbitration provision. The court compelled arbitration but found that the arbitration provision’s exclusion of punitive damages, limit on non-economic damages, and prohibition against attorney’s fees were void as contrary to public policy, since Fla. Stat. Chapter 400 is a remedial statute, and because the discovery limitations and limitations on appeal were “egregiously unconscionable.” On appeal the court upheld the trial court in striking limitations on damages; the Assisted Living Facility Act is remedial and an arbitration agreement that would defeat its purpose is unenforceable. Alterra argued that the resident waived statutory rights and, therefore, the agreement was enforceable. However, the agreement provided that it was governed by the Florida Arbitration Code and, since the code provides for a limited right of appeal, a complete waiver of the right to appeal violates public policy. Alterra argued that the Court had no authority to determine the validity of the limits on damages and that they were issues for the arbitrator, citing Buckeye, supra, as well as Beaver Coaches, Inc. v. Revels Nationwide R.V. Sales, Inc., 543 So.2d 359 (Fla. 1st DCA 1989), and Rollins, Inc. v. Lighthouse Bay Holdings, Ltd., 898 So.2d 86 (Fla. 2d DCS 2005). The Court found the cases were distinguishable because Plaintiff challenged the specific arbitration provisions, including the limitation on liability. In Plaintiff’s cross appeal, the Court reviewed the power of attorney, finding that it gave the resident’s agent power to “transact all business, make, execute and acknowledge all contracts.” Fla. Stat. § 709.08(6) provides that unless otherwise stated in the durable power of attorney, the power of attorney applies to any interest in property. The court noted that the power of attorney did not prohibit the agent from consenting to arbitrate claims on behalf of the principal. Plaintiff then argued that the limitations on damages rendered the entire contract void; the court held otherwise since the contract included a severance clause. Plaintiff’s final argument, that the contract was not signed as to one of the Defendants and therefore unenforceable, was rejected because the parties had performed under the contract.

Note: The arbitration agreement provided: “The only depositions allowed shall be of experts. No other individuals may be deposed. An expert’s deposition shall be limited to six (6) hours per expert and shall be conducted within one 24-hour period, unless agreed to otherwise by mutual consent of the parties.”

This case seems to suggest the result would be different if the power of attorney expressly excluded the right to arbitrate.