California Legal Brief

The Rule of Wright v. WellQuest Elk Grove, LLC is that an arbitration agreement clause stating "an arbitrator will decide any question about whether a claim or dispute must be arbitrated" does not clearly and unmistakably delegate threshold arbitrability issues (including unconscionability and enforceability) to the arbitrator, under circumstances where the language is silent as to interpretation and enforceability issues and lacks specificity about applicable arbitration rules.

Appeal from judgment of the Superior Court of Sacramento County.

Defendant Appellant was WellQuest Elk Grove, LLC — the memory care facility that sought to compel arbitration based on an agreement signed upon patient admission.

Plaintiff Respondents were Erika Wright, Raymond Gregory Charles, and Thomas Wright — family members of deceased patient Kathleen Charles who filed wrongful death and elder abuse claims.

The suit sounded in elder abuse, negligence, fraud, wrongful death, and negligent infliction of emotional distress. The case involved both survivor claims (brought on behalf of deceased Kathleen) and individual claims by family members.

The key substantive facts leading to the suit were that Kathleen Charles, a dementia patient requiring frequent supervision, was found unresponsive in direct sunlight in 102-degree weather three days after admission to WellQuest's memory care facility, suffering burns over 23-25% of her body and dying four days later from heat exposure.

The procedural result leading to the Appeal: The trial court denied WellQuest's motion to stay proceedings and compel arbitration, ruling that the delegation clause did not clearly and unmistakably assign arbitrability issues to the arbitrator, that individual family member claims were not subject to arbitration as non-parties to the agreement, and that Code of Civil Procedure section 1281.2(c) applied to prevent conflicting rulings on common factual issues.

The key question(s) on Appeal: 1. Whether the arbitration agreement's delegation clause clearly and unmistakably assigned threshold arbitrability issues to the arbitrator 2. Whether the FAA's procedural provisions applied to preempt California Code of Civil Procedure section 1281.2(c)

The Appellate Court held that arbitration agreement language stating an arbitrator will decide "whether a claim or dispute must be arbitrated" without express reference to interpretation, enforceability, or unconscionability issues fails to meet the "clear and unmistakable" standard for delegation of arbitrability, and that language requiring arbitration "in accordance with the Federal Arbitration Act" does not expressly incorporate the FAA's procedural provisions to override California's default procedural rules.

The case is inapplicable when the arbitration agreement contains specific language expressly delegating interpretation, validity, enforceability, and unconscionability determinations to the arbitrator, or when the agreement expressly designates FAA procedural provisions rather than merely stating arbitration shall be "in accordance with" the FAA.

The case leaves open questions regarding what specific language would constitute a "clear and unmistakable" delegation of all arbitrability issues to an arbitrator, and whether different phrasing beyond "in accordance with the FAA" might successfully incorporate federal procedural provisions.