April 2, 2019- Lee Hunt v. St. John Healthcare and Rehabilitation Center, No. A-1-CA-36874

1 	IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO
2 	LEE HUNT, as Personal Representative
3 	of the ESTATE OF JOHN EDWARD
4 	BOWEN, Deceased, and KATHERYN
5 	CRAIGHHEAD, DAVID WILLIAM
6 BOWEN, and JOHN CHRISTOPHER
7 BOWEN,
8 	Plaintiffs-Appellees,
9 v. 	No. A-1-CA-36874
10 ST. JOHN HEALTHCARE and
11 	REHABILITATION CENTER, LLC,
12 	Defendant-Appellant,
13 	and
14 	GERIATRICS ASSOCIATES, P.C.,
15 	Defendant.
16 APPEAL FROM THE DISTRICT COURT OF SANTA FE COUNTY
17 	Raymond Z. Ortiz, District Judge
18 	Scott Eugene Borg
19 Albuquerque, NM
20 	for Appellees
21 	Quintairos, Prieto, Wood & Boyer , P.A.
22 	Frank Alvarez
23 	Dallas, TX
24 	for App~llant
Court of Appeals of New Mexico
Filed 4/2/2019 10:35 AM
Mark Reynolds

1 	MEMORANDUM OPINION
2 HANISEE, Judge.
3 	{I} 	St. John Healthcare and Rehabilitation Services (Defendant) appeal from the
4 district court 's order denying their motion to compel arbitration. Defendant has raised
5 three issues on appeal challenging the district court's determination that John Bowen
6 (Decedent) was not competent to sign the arbitration agreement. This Court issued
7 a calendar notice proposing to affirm and Defendant has filed a memorandum in
8 opposition to our notice of proposed disposition, which we have duly considered.
9 Unpersuaded, we affirm.
10 	{2} 	In this Court's calendar notice, we directed Defendant to the general rule that
11 	"the arbitrability of a particular dispute is a threshold issue to be decided by the
12 district court unless there is clear and unmistakable evidence that the parties decided
13 	otherwise under the terms of their arbitration agreement." Felts v. CLK Mgmt. , Inc.,
14 	2011-NMCA-062, ~ 17, 149 N.M. 681, 254 P.3d 124. While we observed in our
15 	notice of proposed disposition that the arbitration agreement included a delegation
16 provision providing "that any controversy or claim arising out of or relating in any
17 way, directly or indirectly, to one or more [d]isputes, including the enforceability of
18 	this [a]rbitration [a]greement, shall be settled by arbitration[,]" [DS 5] we suggested
2

1 that where there is a challenge to the delegation provision itself, then our case law
2 requires the issue to be decided by the courts and not the arbitrator. See id. ~ 20. In
3 response, 	Defendant 	argues 	that 	the 	agreement, 	itself, 	provides 	clear 	and
4 unmistakable evidence of the parties' 	agreement to have the arbitrator decide
5 threshold issues [MIO 3-4] , and that the Appellees ' failure to specifically challenge
6 the 	delegation 	provision 	precludes 	the 	district 	court 	from 	deciding 	their
7 unconscionability claims [MIO 5-6].
8 	{3} 	In Felts, we noted that the United States Supreme Court had "established that
9 challenges to the validity of arbitration provisions fall within two categories: (1) those
10 challenging specifically the validity of the agreement to arbitrate; and (2) those
11 	challenging the contract as a whole, either on a ground that directly affects the entire
12 	agreement .. . or on the ground that the illegality of one of the contract' s provisions
13 	renders the whole contract invalid." 2011-NMCA-062, ~ 19 , 149 N.M. 681,254 P.3d
14 	124 (alterations, internal quotation marks, and citation omitted). We noted, in Felts,
15 	that only the first type of challenge was for the courts to decide. Id. Felts goes on to
16 recognize 	that 	"[i]n 	circumstances 	where 	parties 	have 	decided 	to 	arbitrate
17 	arbitrability-that is , where there is a delegation provision assigning questions of
18 	arbitrability to an arbitration- .. . Rent-A-Ce nte r[, Wes t, In c. v. Jackson, 561 U.S.
19 63 	(2 01 O)] 	appears to stand for the proposition that a party must specifically
3

1 challenge the delegation provision in order for a court to consider the challenge rather
2 than referring the matter to an arbitrator." Id. ,I 20. Defendant relies on this principle
3 	to argue that Appellees have failed to challenge the delegation provision and this
4 	required the district court to compel arbitration.
5 	{4} 	However, in Felts, this Court determined that the delegation clause was
6 properly challenged because Felts argued that the agreement was unconscionable due
7 to the class action ban and the use of the National Arbitration Forum (NAF) and both
8 the class action ban and the NAF were mentioned in the delegation provision. Id.
9 ,r,r 28-30. Thus, Felts appears to take a less stringent approach to determining whether
10 the delegation provision has been challenged than Defendant suggests. Thus, we
11 	consider Appellees' challenge to a signatory's ability to enter into the contract
12 	sufficient to challenge the delegation clause, where Appellees are challenging the
13 	ability of the Decedent to have formed an agreement as to any of the provisions-that
14 one included. See Salazar v. Citadel Comm 'ns Corp., 20 04-NMSC-013 , ,r 8, 135
15 	N.M. 44 7, 90 P.3 d 466 ( stating "a prerequisite to compelling arbitration is the
16 	existence of a valid agreement to arbitrate"); see also Heye v. Am. Golf Corp., 2003-
17 NMCA-138, ,r 8, 134 N.M. 558, 80 P.3d 495. Thus, we conclude that the district
18 	court, rather than arbitration, was the correct forum for resolution of Decedent's
19 competency.
4

1 {S} 	Furthermore, to the extent Defendant contends that the district court improperly
2 considered the affidavit and documents attached to the affidavit of Decedent's wife,
3 we conclude that Defendant has not demonstrated error. To the extent that Defendant
4 	challenges the use of parol evidence to contradict the express terms of the agreement,
5 relying on Sanders v. FedEx Ground Package Sys., Inc., 2008-NMSC-040, ~ 29, 144
6 N.M. 449, 188 P.3d 1200, their reliance on Sanders is unavailing. [MIO 9] Sanders
7 specifically provides that, "[ w ]hile the parol evidence rule precludes the admission
8 of prior negotiations or extrinsic evidence offered to contradict or vary the terms of
9 	a complete, integrated, written agreement, evidence extrinsic to a written contract is
10 properly admitted to determine the circumstances under which the parties contracted
11 	and the purpose of the contract." Id. 	~ 29 n.2 (alterations, omissions, internal
12 	quotation marks, and citation omitted). Thus, the introduction of evidence to show
13 	that a contract was not voluntary, despite an assertion in a contract that the parties
14 voluntarily agreed, is not prohibited by Sanders.
15 	{6} 	In addition, Defendant provides no authority--either on appeal or in their reply
16 	in support of their motion to compel-that testimony from a medical expert via
17 affidavit was necessary to conclude that the decedent was mentally incapable of
18 entering into a contract. [MIO 1O; see generally RP 145-50] See Curry v. Great Nw .
19 Ins. Co., 2014-NMCA-031, ~ 28,320 P.3d 482 ("Where a party cites no authority to
5

1 support an argument, we may assume no such authority exists."). To the extent
2 Defendant relies on Rules 11-401 to 11-404, 11-603, 11-801, and 11-803 NMRA, we
3 conclude these arguments are similarly unavailing. First, to the extent that there are
4 statements and other pieces of information contained in the documents that are
5 irrelevant, we presume that a district court disregards incompetent evidence. See State
6 ex rel. Dep 'tofHumanServs. v. TommyA.M, 1987-NMCA-043, ,-po, 105 N.M. 664,
7 735 P.2d 1170 ("In a non-jury case, the trial court is presumed to have disregarded
8 incompetent evidence, absent a showing that the court was influenced thereby.").
9 Second, to the extent Defendant challenges the medical records on what we assume
10 	is hearsay grounds, Rule 11-803 provides an exception for statements made for
11 	medical diagnosis or treatment. Thus, given that Defendant did not further explain the
12 reasoning behind its objection, this Court applies a presumption of correctness to the
13 	district court's ruling. 	See Farmers, Inc. v. Dal Mach. & Fabricating, Inc., 1990-
14 NMSC-100, 18, 111 N.M. 6,800 P.2d 1063 ("The presumption upon review favors
15 	the correctness of the trial court's actions. 	[The defendant] must affirmatively
16 	demonstrate its assertion of error."); Headleyv. Morgan Mgmt. Corp., 2005-NMCA-
17 	045, 115, 137 N.M. 339, 110 P.3d 1076 ("We will not review unclear arguments, or
18 	guess at what [a party's] arguments might be."). Finally, Appellant does not specify
19 	what more is required by the affidavit of Decedent's wife to satisfy the requirements
6

1 of Rule 11-603 regarding oath or affirmation. See Corona v. Corona, 2014-NMCA-
2 071, ,r 28, 329 P.3d 701 ("This Court has no duty to review an argument that is not
3 adequately developed."). While Defendant asserts that it is the obligation of this
4 Court to review the record proper [MIO 10-11 ], it is not the obligation of this Court
5 to try to guess at Defendant's arguments on appeal or search the record for clues. See
6 Muse v. Muse , 2009-NMCA-003, ,I 72, 145 N.M. 451,200 P.3d 104 ("We will not
7 search the record for facts, arguments, and rulings in order to support generalized
8 arguments.").
9 	{7} 	Accordingly, for the reasons stated above and in this Court's notice of
10 proposed disposition, we affirm the district court's order denying Defendant's motion
11 	to compel arbitration.
12 	{8}
13
14
IT IS SO ORDERED.
15 	WE CONCUR:
16 	~~dk17 JE 	~ATTREP,Judge
18
19 	MEGAN P. DUFFY, Ju
Jt 	.. 	~-a. 	~ 	.. .
J. MilES HA 	ISEE, Judge
7