THI of New Mexico at Vida Encantada v. Lovato

Guadalupe Duran was admitted to THI of New Mexico at Vida Encantada, LLC (THI) (defendant), a nursing home. As part of the admission process, Duran’s daughter signed an arbitration agreement on Duran’s behalf, stating that the parties agreed to submit all disputes to arbitration as defined by the National Arbitration Forum Code of Procedure (NAF code). The document stated that the Federal Arbitration Act (FAA) would govern the agreement. Duran fell while in THI’s care and suffered a stroke while in surgery for the injuries. Duran soon died while in THI’s care, and her granddaughter, Mary Louise Lovato (plaintiff), sued THI in New Mexico state court on behalf of Duran’s estate. THI petitioned a federal district court to compel arbitration under the FAA, and the district court granted THI’s motion. The arbitrator issued an award for Lovato, including compensatory damages, arbitration costs, and interest. The arbitrator issued the award under the New Mexico Uniform Arbitration Act (NMUAA), which governed all arbitration agreements in the state and allowed arbitrators to award costs and interest as remedies. THI petitioned the district court to vacate or modify the award, and Lovato moved to confirm the award. The district court affirmed the award, and THI appealed to the Tenth Circuit, arguing that the arbitrator exceeded his authority and manifestly disregarded the law under the FAA by awarding costs and interest to Lovato.