ESTATE OE YETTA NOVOSETT, ETC., APPELLANT,
v.
ARC VILLAGES II, LLC, ARC LADY LAKE, INC., ET AL., APPELLEES
AI-generated. These summaries, headnotes, and key points are machine-generated and may contain errors or omissions. Always verify against the full opinion text below. Not legal advice.
The Fifth District Court of Appeal reversed a lower court's order compelling arbitration in a dispute between a nursing home and the estate of a deceased resident, holding that an arbitration agreement's unenforceable damages cap provision went to the financial heart of the agreement and rendered the entire agreement unenforceable despite a severability clause.
The court held that the arbitration agreement is entirely unenforceable because the damages cap provision constitutes the financial heart of the agreement and goes to its very essence, making the severability clause inapplicable. The presence of a severability clause is not dispositive of whether a void provision invalidates an entire contract; rather, the controlling issue is whether the offending clause goes to the essence of the agreement.
[1] An arbitration agreement containing an unenforceable limitation of liability provision that goes to the financial heart of the agreement is unenforceable in its entirety.
[2] A severability clause does not render an otherwise unenforceable provision severable if that provision constitutes the financial heart of the agreement.
Previewing 2 of 4 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“the limitation of liability provisions "place a clear upper limit on noneconomic damages and foreclose the prospect of punitive damages altogether. In this respect, the [limitation of liability provisions] constitute the financial heart of the agreement."”
Establishes that damages caps constitute the financial heart of an arbitration agreement, rendering the entire agreement unenforceable
Previewing 1 of 3 key quotes on this case — the court’s exact language, pinpointed for members.
Join FLexlaw to unlock all legal intelligenceThe nursing home (ARC Villages II, LLC and Arc Lady Lake, Inc.) included an arbitration agreement in its admissions documents that contained a limitat…
The full statement of facts, procedural history, and disposition for this case are member content.
Join FLexlaw to unlock all legal intelligence© FLexlaw, Inc. — AI-generated enrichments are proprietary. All rights reserved.
Explore caselaw by topic → Browse Arbitration Agreement Enforceability cases and more on FLexlaw
We address the enforceability of an arbitration agreement in this dispute between the nursing home owner/operators and the estate of a deceased resident of the nursing home. Because the agreement contains an unenforceable' cap oh damages that goes to the “financial heart” of the agreement, we conclude that the entire agreement "is unenforceable and reverse. See Gessa v. Manor Care of Fla., 86 So.3d 484, 490-91 (Fla.2011) (holding that limitation of liability provisions in arbitration agreement included in nursing home’s admissions documents violated public policy and were not severable because they constituted financial heart of arbitration agreement).
The arbitration contract in this case contains a limitation of liability provision, purporting to place a cap on non-economic damages and preclude the availability of punitive damages. The lower court correctly held that this provision is against public policy and void. See id. at 492-93. It, nevertheless, compelled arbitration because this contract contains a severability clause. We conclude that Ges- *896 sa is controlling here, notwithstanding the fact that the arbitration clause in Gessa did not contain a severability clause. 'The existence of a severability clause in an agreement is clearly not dispositive of whether a void clause invalidates the entire contract. Shotts v. OP Winter Haven, Inc., 86 So.3d 456, 478 (Fla.2011). Rather, the controlling issue is whether an offending clause or clauses go to “the very essence of the agreement.” Id. As our high court stated in Gessa, the limitation of liability provisions “place a clear upper limit on noneconomic damages and foreclose the prospect of punitive damages al-together_ In this respect, the [limitation of liability provisions] constitute the financial heart of the agreement.” 86 So.3d at 490. As in Gessa, we conclude that the offending clauses go to the essence of the agreement, invalidating the entire agreement, notwithstanding the severability clause.
Accordingly, the order compelling arbitration is reversed, and this cause is remanded for further proceedings. We certify the following question to the Florida Supreme Court as one of great public importance:
Does the Court’s holding in Gessa v. Manor Care of Florida, 86 So.3d 484 (Fla.2011), control where, as here, the contract contains a severability clause?
REVERSED AND REMANDED; QUESTION CERTIFIED.
ORFINGER, TORPY, and COHEN, JJ., concur.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
-
Hochbaum v. Palm Garden OF Winter Haven, LLC, 201 So. 3d 218 (Fla. 2d DCA 2016)…determinative of whether an offending provision may be severed from the agreement and that the “controlling issue is whether an offending clause or clauses go to ‘the very essence of the agreement.’” Estate of Yetta Novosett v. Arc Villages II, LLC, 189 So. 3d 895, 896 (Fla. 5th DCA 2016) (applying Shotts and Gessa and holding that limitation-of-liability provision capping non-economic damages and precluding punitive damages violated public policy and could not be severed, despite the existence of a severabil…
-
Rockledge NH, LLC v. Miley, 219 So. 3d 246 (Fla. 5th DCA 2017)…ining provisions of the agreement [would] remain in full force and effect.” The existence of a severability clause is not dispositive of whether a void clause invalidates the entire arbitration agreement. Estate of Novosett v. Arc Villages II, LLC, 189 So. 3d 895, 896 (Fla. 5th DCA 2016). Rather, the controlling issue is whether an offending clause goes to “the very essence of the agreement.” Shotts v. OP Winter Haven, Inc., 86 So. 3d 456, 459, 478 (Fla. 2011); Estate of Novosett, 189 So. 3d at 896. On the o…
-
Est. OF Robert F. Reinshagen v. Wryp ALF, LLC, 190 So. 3d 224 (Fla. 5th DCA 2016)…pursuant to an arbitration clause in the residence agreement between Appellees and the decedent. We reverse the order compelling arbitration based upon our recent opinion in [*225] Estate of Novosett v. Arc Villages II, LLC, 41 Fla. L. Weekly D652, 189 So. 3d 895, 2016 WL 916936 (Fla. 5th DCA Mar. 11, 2016). In that case, the trial'fcDurt' held that the provisions in the arbitration agreement between the nursing’home owner/operators and the estate of a deceased resident of the nursing home, which placed a ca…
Previewing 3 of 9 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Shotts v. OP Winter Haven, Inc., 86 So. 3d 456 (Fla. 2011)
- Gessa v. Manor Care OF Fla., Inc., 86 So. 3d 484 (Fla. 2011)