A nursing home arbitration agreement may be executed by an attorney-in-fact acting under a valid durable power of attorney, as clarified by the Arkansas Court of Appeals in Sherwood Nursing & Rehabilitation Center, Inc. v. Witkowski, 2026 Ark. App. 236.
The court reversed a lower court’s determination that such authority was insufficient to waive a resident’s constitutional right to a jury trial, holding that Arkansas statutes expressly permit agents empowered over claims and litigation to submit disputes to arbitration.
The decision reinforces the strong federal and state policies favoring arbitration while confirming that enforceability remains subject to traditional contract defenses, including unconscionability.
By remanding the matter for further proceedings, the court underscored the necessity of assessing contractual validity and scope under established legal principles.
The ruling carries significant implications for healthcare providers, in-house counsel, litigators, and compliance professionals, particularly in relation to governance, risk management, and admission practices within regulated care settings.
Incident and Procedural Background
The dispute arose following the admission of Alma Gennings to Sherwood Nursing & Rehabilitation Center in June 2023, where admission documents, including a nursing home arbitration agreement, were executed by her daughter, Dana Witkowski, acting as attorney-in-fact under a valid durable power of attorney.
The agreement expressly stated that arbitration was voluntary and not a condition of admission or continued care.
After Ms. Gennings was discharged, hospitalized, and later passed away on September 9, 2023, Ms. Witkowski, acting as personal representative of the estate and on behalf of wrongful death beneficiaries—initiated legal proceedings against the facility and related defendants.
The complaint alleged ordinary negligence, medical negligence, breach of contract, and deceptive trade practices. In response, the defendants filed a motion to compel arbitration pursuant to the admission agreement.
The Pulaski County Circuit Court denied the motion, holding that a durable power of attorney, unlike a court-appointed guardianship, was insufficient to waive a constitutional right to a jury trial.
The defendants appealed. On April 15, 2026, the Arkansas Court of Appeals reversed that decision in Sherwood Nursing & Rehabilitation Center, Inc. v. Witkowski, 2026 Ark. App. 236.
Conducting a de novo review, the appellate court determined that the circuit court had misinterpreted the law, concluding that Arkansas statutes expressly authorize an agent acting under a power of attorney to submit disputes to arbitration when empowered to act in matters concerning claims and litigation.
The case was remanded for further proceedings to determine whether a valid arbitration agreement exists, whether the dispute falls within its scope, and whether any contractual defenses, including unconscionability, render the agreement unenforceable.
Judicial Reasoning and Legal Framework
The court’s analysis centered on foundational principles of agency, contract law, and arbitration. It reaffirmed that arbitration agreements governed by the Federal Arbitration Act (FAA) are favored as a matter of national policy, while state contract law determines their validity and enforceability.
When a third party executes an arbitration agreement on behalf of another, courts must determine whether the agent possessed the legal authority to bind the principal.
In this case, Ms. Witkowski acknowledged that she acted as her mother’s attorney-in-fact under a valid durable power of attorney and signed the nursing home arbitration agreement in that capacity.
The Arkansas Court of Appeals determined that Arkansas law expressly permits such authority. Statutory provisions under the Arkansas Uniform Power of Attorney Act authorize agents empowered over claims and litigation to submit disputes to arbitration or alternative dispute resolution.
This legislative framework confirms that a properly executed power of attorney may lawfully bind a principal to arbitration.
The court further emphasized that the enforceability of an arbitration agreement must be evaluated under established legal principles.
Under Arkansas law, a valid arbitration agreement requires competent parties, mutual assent, legal consideration, mutual obligation, and a lawful subject matter.
Even where these elements are satisfied, courts may invalidate arbitration agreements based on generally applicable contract defenses, including fraud, duress, or unconscionability.
Because the circuit court failed to evaluate these threshold issues, the appellate court remanded the matter for further proceedings to determine whether a valid arbitration agreement exists, whether the dispute falls within its scope, and whether any contractual defenses render the agreement unenforceable.
This decision reinforces the interaction between federal arbitration policy and state contract law while clarifying the legal authority of attorneys-in-fact in healthcare admission agreements.
It carries substantial implications for healthcare providers, corporate counsel, compliance professionals, and risk managers responsible for ensuring the enforceability of arbitration clauses and maintaining robust governance and documentation practices within regulated care environments.
Liability, Damages, and Litigation Risk
The appellate decision addressed only the enforceability of the arbitration agreement and did not determine liability or damages.
Nevertheless, the underlying claims, ordinary negligence, medical negligence, breach of contract, and deceptive trade practices, present substantial legal, financial, and reputational risks.
Potential remedies may include compensatory damages, wrongful death damages, and statutory relief, depending on the outcome of the proceedings and the forum in which the dispute is adjudicated.
Whether the matter proceeds in arbitration or in court will materially influence litigation strategy, costs, and overall risk exposure. Arbitration can affect discovery obligations, procedural timelines, confidentiality considerations, and settlement dynamics.
As a result, the enforceability of arbitration provisions remains a critical component of risk management and contractual governance within the healthcare sector.
For healthcare providers, insurers, and in-house counsel, this case underscores the importance of ensuring that admission agreements are legally compliant, transparently executed, and supported by robust documentation and compliance controls.
Corporate Governance and Compliance Implications
Beyond the immediate dispute, the ruling underscores the critical importance of robust corporate governance and compliance frameworks in regulated industries, particularly the long-term care and healthcare sectors.
The decision confirms that arbitration agreements executed by agents under a valid durable power of attorney may be enforceable when they comply with applicable statutory and contractual requirements.
This clarification strengthens legal certainty surrounding consent, agency authority, and dispute resolution in healthcare admission processes.
Healthcare providers and affiliated organisations should ensure that admission procedures are transparent, legally compliant, and supported by comprehensive documentation.
Verifying the authority of attorneys-in-fact, clearly communicating contractual terms, and securely retaining executed agreements are essential measures for mitigating legal and regulatory risk.
From a governance standpoint, the decision highlights the importance of structured staff training, standardized documentation protocols, and periodic internal audits to ensure adherence to arbitration and informed consent requirements.
For in-house counsel, compliance officers, and risk managers, the judgment reinforces that enforceability disputes frequently hinge on procedural integrity and contractual clarity.
Properly drafted and executed admission agreements play a pivotal role in managing liability exposure, controlling litigation costs, and safeguarding organisational interests.
As regulatory scrutiny within the healthcare sector continues to intensify, the case serves as a timely reminder that effective governance and compliance practices are integral to operational resilience and legal defensibility.
Practical and Regulatory Significance
This ruling carries significant implications for healthcare providers, litigators, policymakers, and compliance professionals.
It clarifies the legal authority of attorneys-in-fact to bind principals to arbitration agreements and reinforces the interaction between agency law, contract law, and federal arbitration policy.
Although the decision arises from private litigation, its impact extends to regulatory compliance, dispute resolution frameworks, and contractual governance throughout the healthcare sector.
The judgment provides greater legal certainty regarding the enforceability of arbitration provisions executed under a valid durable power of attorney.
The case also reflects heightened judicial scrutiny of arbitration agreements in care settings, particularly where patient rights and informed consent are implicated.
Accordingly, organisations must ensure that arbitration provisions are presented transparently, executed with proper authority, and documented in accordance with statutory requirements and recognised governance standards.
For healthcare providers and their advisors, the decision underscores the importance of robust compliance frameworks, clear contractual practices, and ongoing risk management to safeguard enforceability and maintain regulatory integrity.
Key Takeaways
A durable power of attorney may authorize an agent to execute a nursing home arbitration agreement when the instrument grants authority over claims and litigation.
The Arkansas Court of Appeals clarified that such authority can extend to waiving the constitutional right to a jury trial.
The decision reinforces the strong federal and state policies favoring arbitration while confirming that enforceability remains subject to generally applicable contract defenses, including fraud, duress, and unconscionability.
It further underscores the importance of precise documentation, informed consent, and transparent admission procedures.
For healthcare providers, legal practitioners, and compliance professionals, the ruling highlights the necessity of robust governance frameworks and risk management practices to ensure the enforceability of arbitration agreements and compliance with statutory requirements.
What Happens Next
The case has been remanded to the Pulaski County Circuit Court for further proceedings consistent with the Arkansas Court of Appeals’ decision.
The lower court must determine whether a valid arbitration agreement exists, whether the dispute falls within its scope, and whether generally applicable contract defenses such as unconscionability, render the agreement unenforceable.
The court’s determinations will decide whether the claims proceed in arbitration or in court, directly influencing litigation strategy, procedural timelines, and potential liability exposure.
Beyond the immediate dispute, the outcome may shape future litigation involving healthcare arbitration agreements, particularly those executed under a durable power of attorney.
As such, the proceedings are likely to inform best practices in contractual governance, regulatory compliance, and risk management across the long-term care and healthcare sectors.
People Also Ask
Can a power of attorney sign an arbitration agreement?
Yes. The Arkansas Court of Appeals confirmed that an attorney-in-fact may sign an arbitration agreement when authorized to act in matters involving claims and litigation.
What did the Arkansas Court of Appeals decide in Sherwood Nursing v. Witkowski?
The court reversed the denial of arbitration and remanded the case for further proceedings on enforceability.
Does the Federal Arbitration Act apply to nursing home agreements?
Yes. The FAA governs arbitration agreements while state law determines their validity and enforceability.
What defenses can invalidate an arbitration agreement?
Common defenses include unconscionability, fraud, and duress.
Why is this case significant for healthcare providers?
It clarifies consent, agency authority, and arbitration enforceability in nursing home admission agreements.