Laurel Creek Health Care Center v. Bishop
Court of Appeals of Kentucky,____S.W.3d___(2010)
FACTS
Gilbert Bishop was admitted to Laurel Creek Health Care Center on July 23, 2002, after arriving via ambulance without family present. During that examination, Gilbert communicated to Laurel Creek staff that he could not use his hands well enough to write or hold a pencil. Gilbert was otherwise found to be mentally competent. Gilbert’s sister, Rachel Combs, arrived after Gilbert, she offered to sign the admissions forms, but Laurel Creek employees told her that it was their policy to have the patient’s spouse sign the admissions papers if the patient was unable to sign them. Rachel also testified that Gilbert asked her to get his wife, Anna
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REASON
Laurel Creek first argues that this is a case of actual agency and that Anna Bishop has actual authority as Gilbert’s agent to sign the admissions paperwork as is therefore bound by the arbitration agreement therein.
We agree with Laurel Creek that Gilbert created an actual agency relationship between him and his wife. According to his sister, Rachel, Gilbert specifically asked that his wife be brought to the nursing home so that she could sign the admissions documents for him, and Anna acted upon that delegation of authority and signed the admissions papers. This is consistent with the creation of actual authority as described in the Restatement (Third) of Agency § 2.01, comment c (2006). The Restatement explains the rationale for the creation of actual agency in three steps. First, “the principal manifests assent to be affected by the agent’s action.” In the instant case, Gilbert asked that Anna come to the hospital to sign the papers for him. Second, “the agent’s actions establish the agent’s consent to act on the principal’s behalf.” Here, Anna signed all the admissions papers per her husband’s request and therefore consented to act on Gilbert’s behalf. Third, by acting within such authority, the agent affects the principal’s legal relations with third parties. Clearly here, Anna’s actions affected Gilbert’s relations with Laurel Creek, a third party.
The trial court acknowledged that Gilbert had the
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