Business Law Today, Comprehensive 10th Edition by Roger LeRoy Miller

Exercise 12

A Question of Ethics - Agreement to Arbitrate. Nellie Lumpkin, who suffered from dementia, was admitted to the Picayune Convalescent Center, a nursing home. Because of her mental condition, her daughter, Beverly McDaniel, signed the admissions agreement. It included a clause requiring the parties to submit any dispute to arbitration. After Lumpkin left the center two years later, she filed a suit against Picayune to recover damages for mistreatment and malpractice.
1. Is it ethical for this dispute-involving negligent medical care, not a breach of a commercial contract-to be forced into arbitration Why or why not Discuss whether medical facilities should be able to impose arbitration when there is generally no bargaining over such terms.
2. Should a person with limited mental capacity be held to the arbitration clause agreed to by her next of kin who signed on her behalf Why or why not