The Illinois Supreme Court recently rendered a decision that could have significant repercussions for operators of nursing homes in the state. The case, Clanton v. Oakbrook Healthcare Centre, Ltd., et al., 2023 IL 129067, focuses on whether a nursing home can use a resident contract to compel arbitration following a resident’s death.
In this case, after a resident’s death, Oakbrook Healthcare Centre attempted to enforce an arbitration clause in response to a lawsuit filed under the Illinois’ Survival Act by the deceased resident’s daughter. The nursing home’s argument centered on the fact that their resident’s contract contained a provision that mandated arbitration of any disputes. However, the contract also contained a provision stating that the contract would terminate upon the resident’s death.
In its judgment, the court held that due to the predetermined termination at the death clause within the contract, Oakbrook could not enforce the arbitration clause after the resident’s death. This ruling delivers a clear message to nursing home operators in Illinois, cautioning them to reconsider clauses that terminate contracts at a resident’s death if they also wish to maintain the ability to compel arbitration following disputes after a resident’s death.
Given the potential financial implications of such lawsuits, it is crucial for nursing homes, their legal counsel, and their insurers to take note of this ruling and consider its impact when drafting and revising resident contracts. As disputes involving nursing homes can often become protracted and costly legal battles, the decision in Clanton v. Oakbrook Healthcare Centre could represent a significant turning point in the landscape of nursing home litigation in Illinois and potentially beyond.