Illinois Appellate Court Requires Lower Court to Enter a Stay of Wrongful Death Proceedings During Arbitration of Survival and Family Expense Claims
November 15, 2017
On November 9, 2017, the Illinois Appellate Court reversed the ruling of the Circuit Court in Hayes v. Victory Centre of River Woods, LLC, 2017 IL App (1st) 162207 and held that the lower court erred in denying Defendant’s motion to stay the Wrongful Death claim pending arbitration of the Survival and Family Expense claims raised in the Plaintiff’s complaint.
On March 1, 2013, Ann Sanders entered into a residence agreement with the Defendant, a licensed supportive living facility. Pursuant to an Addendum to the Residence Agreement, the parties agreed that all claims arising out of that agreement, including those of malpractice, could not be brought in a court of law but were to be submitted to binding arbitration. Subsequently, Mrs. Sanders, who suffered from diabetes, suffered a diabetic shock and lapsed into a diabetic coma. She was transferred to Gottlieb Hospital where she died on May 21, 2013.
On May 21, 2015, the Plaintiff, Independent Administrator of the Estate of Ann Sanders, deceased, filed a complaint against the Defendant alleging negligence and seeking damages in connection with the death of Mrs. Sanders pursuant to the Wrongful Death Act, the Family Expense Act, and the Survival Act. The Defendant filed a motion to dismiss, maintaining that the Addendum to the Residence Agreement required the Family Expense and Survival claims be submitted to binding arbitration, and requested those claims be dismissed. The Defendant further requested the Wrongful Death claim be stayed until the conclusion of arbitration proceedings. In response, the Plaintiff contended the arbitration provisions were unenforceable but, assuming they were, the court should proceed first on the Wrongful Death claim. The Circuit Court ruled that the Family Expense and Survival claims were subject to binding arbitration and dismissed those claims, but denied the motion to stay the Wrongful Death proceedings.
On appeal, the Appellate Court applied Section 2(d) of the Uniform Arbitration Act (Uniform Act) (710 ILCS 5/2(d), which provides in pertinent part that “[a]ny action or proceeding involving an issue subject to arbitration shall be stayed if an order for arbitration […] has been made under this Section or, if the issue is severable, the stay may be with respect thereto only.” To determine how the arbitration and remaining litigation should proceed, the court considered three factors set forth by the reviewing court in Bass v. SMG, Inc., 328 Ill. App. 3d 492, 507 (2002):
(1) the dominance of the plaintiff’s derivative claims over any individual ones,
(2) the possible inefficiency of dual proceedings, and
(3) the potential effect of collateral estoppel on whichever proceeding is last to conclude.
Applying the Bass considerations, the court determined: 1) all three of the plaintiff’s claims (Wrongful Death, Survival and Family Expense) turn on allegations of the Defendant’s negligence; 2) denying the stay would result in two proceedings addressing and determining the same issue (dual proceedings), constituting an inefficient use of judicial resources; and 3) whether the Defendant was negligent in its care of Mrs. Sanders was definitive for the arbitrable claims and the Wrongful Death claim.
Accordingly, the Appellate Court remanded the case to the Circuit Court for the entry of an order staying the proceedings on Plaintiff’s Wrongful Death claim until the conclusion of the arbitration of the arbitrable claims.
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