When a person becomes mentally incapacitated at the end of their life, a durable power-of-attorney (POA) is designed to make things easier for the family. Unfortunately, estate-planning attorneys are drafting POAs that may do more harm than good. Many POAs unnecessarily give family members the right to bind a loved one and an estate to predispute arbitration. This is particularly true in the context of nursing-home care, especially after the Appellate Court’s decision in Ruszala v. Brookdale Living, 415 N.J. Super. 272 (App. Div. 2010). In Ruszala, the court held that the Federal Arbitration Act preempted New Jersey’s prohibition on??arbitration??agreements in nursing-home contracts designed to protect the elderly. As a result of that decision, an increasing number of New Jersey nursing-home companies are exploiting people’s ignorance of the inequitable downside of predispute arbitration by slipping predispute arbitration clauses in admission agreements.

The Right to Access the Civil Justice System

In 1976, the legislature attempted to address the exploitation of the elderly and ameliorate the harsh conditions they endured in nursing homes by enacting the Nursing Home Responsibilities and Rights of Residents Act, N.J.S.A.??30:13-1 to -11. It imposes certain responsibilities on nursing homes and declares the “[r]ights of nursing home residents.” It also creates a private cause of action for damages for “[a]ny person or resident whose rights … are violated [under the Act] … against any person committing such violation.”??N.J.S.A.??30:13-8(a). That provision guarantees the residents’ constitutional right to access the civil justice system and have disputes settled by a jury trial. The act also made predispute arbitration clauses unenforceable until Ruszala.

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