The Kentucky Supreme Court affirmed a court of appeals’ ruling that Kentucky’s Living Will Directive Act (the Act) does not authorize a spouse to enter a mandatory arbitration agreement on her husband’s behalf upon his admission to a nursing facility because signing the agreement was not a healthcare decision under the Act. Lexington Alzheimer’s Investors, LLC v. Norris, No. 2023-SC-0510-DG (Ky. Aug. 14, 2025).
In 2019, Sandra Norris was appointed as her husband Rayford’s conservator by a Tennessee court after his diagnosis with Alzheimer’s disease. She sought his admission to a private-pay personal care facility, The Lantern, in Lexington, Kentucky. Sandra did not register the 2019 Tennessee order in Kentucky. The Lantern required Sandra to sign a mandatory arbitration agreement before Rayford’s admission to the facility. The agreement requested that the signee indicate the capacity in which they were signing, for example, self, power of attorney, or guardian, etc. However, Sandra did not do so. Nevertheless, Rayford was admitted to The Lantern and resided there until March 2020. Sandra alleged that he fell multiple times, lost weight, and suffered from an infected bed sore while he resided at The Lantern. Rayford died in August 2020.
Sandra filed a lawsuit against The Lantern, asserting multiple claims, including negligence, medical negligence, and wrongful death. The Lantern filed a motion to stay the claims and compel arbitration, asserting that Kentucky’s Living Will Directive Act, Ken. Rev. Stat. § 311.631, granted Sandra the authority to enter into the arbitration agreement on Rayford’s behalf. The Lantern acknowledged that the Tennessee court order was not registered in Kentucky and had no legal effect there. The circuit court denied The Lantern’s motion to compel arbitration, holding that signing an arbitration agreement was not a healthcare decision under the Living Will Directive Act. The Kentucky Court of Appeals affirmed its decision, and the Kentucky Supreme Court granted The Lantern’s request for review.
The Kentucky Supreme Court distinguished its precedent holding or stating as dicta that where an agent under a power of attorney expressing general authority to make healthcare decisions or a guardian is presented with an agreement to arbitrate as a condition to admission to a nursing facility, the agent has the incidental or reasonably necessary authority to enter the arbitration agreement. In contrast to the facts in those cases, Sandra was not Rayford’s agent under a power of attorney, his guardian or conservator under an order enforceable in Kentucky, or his surrogate under a living will or advance directive.
Under the Living Will Directive Act, when an individual’s physician has made a written determination that the individual lacks decisional capacity, a spouse is authorized to make certain healthcare decisions on their behalf, even if they do not have a living will or advance directive. However, the Act only authorizes the spouse to decide whether to consent to or withdraw consent for any medical procedure, treatment, or intervention. The court determined that signing an arbitration agreement was not a medical procedure, treatment, or intervention and thus was not a healthcare decision under the Act. Therefore, the Act did not authorize Sandra, as Rayford’s spouse, to enter into the arbitration agreement on his behalf. In addition, the court noted that nothing other than the unregistered Tennessee order indicated that Rayford’s physician might have determined he lacked decisional capacity.
The court also rejected The Lantern’s argument that the lower courts had flouted the US Supreme Court’s ruling in Kindred Nursing Ctrs. Ltd. P'ship v. Clark, 581 U.S. 246 (2017), which had invalidated the clear-statement rule, i.e., that a power of attorney must explicitly state that an agent has the authority to enter into arbitration agreements. The US Supreme Court held the rule violated the Federal Arbitration Act by discriminating against arbitration agreements instead of placing them on equal footing with other contracts. The court determined Kindred Nursing was inapplicable: The court’s determination that the arbitration agreement was invalid was based on a generally applicable contract defense—an agent’s lack of authority to bind the principal—and did not discriminate against arbitration. Thus, the court affirmed and remanded the case for further proceedings.
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