Ralph R. Fresquez v. Trinidad Inn

The summaries of the Colorado Court of Appeals published opinions
constitute no part of the opinion of the division but have been prepared by
the division for the convenience of the reader. The summaries may not be
cited or relied upon as they are not the official language of the division.
Any discrepancy between the language in the summary and in the opinion
should be resolved in favor of the language in the opinion.

SUMMARY
August 25, 2019

2022COA96

No. 21CA0118, Fresquez v. Trinidad Inn — Health and Welfare
— Health Care Availability Act — Arbitration Agreements; ADR
— Arbitration; Agency — Actual Authority — Apparent
Authority

A division of the court of appeals considers an agent’s

authority to bind a principal to an arbitration agreement under the

Health-Care Availability Act (the Act), §§ 13-64-101 to -503, C.R.S.

2021. While the Act details the steps a health care provider must

take to form an enforceable arbitration agreement with a patient, it

is silent regarding the requirements that a patient’s agent must

satisfy to bind the patient to an arbitration agreement. In this case,

the division considers the novel issue of whether an agent with

actual authority to execute the documents required to admit the

patient to a health care facility necessarily also possesses the
authority to bind the patient to an arbitration agreement with the

facility.

The division holds that an agent’s actual authority to make

health care decisions for a patient and to sign the documents

necessary to admit the patient to a health care facility does not

encompass the authority to bind the patient to an arbitration

agreement, unless the patient has granted the agent an unlimited

power of attorney or otherwise clearly granted the agent the specific

authority to bind the patient to an arbitration agreement.
COLORADO COURT OF APPEALS 2022COA96

Court of Appeals No. 21CA0118
Las Animas County District Court No. 20CV30010
Honorable J. Clay McKisson, Judge

Ralph R. Fresquez, individually and as Personal Representative of the Estate of
Beatrice Trujillo, deceased,

Plaintiff-Appellee,

v.

Trinidad Inn, Inc., d/b/a Trinidad Inn; C&G Health Care Management, Inc.;
and Brittnee Fransua, in her Capacity as Administrator of Trinidad Inn,

Defendants-Appellants.

JUDGMENT AFFIRMED AND CASE
REMANDED WITH DIRECTIONS

Division VII
Opinion by JUDGE LIPINSKY
Navarro and Kuhn, JJ., concur

Announced August 25, 2022

Reddick Law, PLLC, Brian D. Reddick, Robert W. Francis, Little Rock,
Arkansas, for Plaintiff-Appellee

Messner Reeves LLP, Douglas C. Wolanske, Kendra N. Beckwith, Mary Byrne
Fletcher, Darren D. Alberti, Denver, Colorado, for Defendants-Appellants
¶1 The Health-Care Availability Act (the Act), §§ 13-64-101

to -503, C.R.S. 2021, permits health care providers to ask their

patients to sign arbitration agreements. The General Assembly

adopted the Act based on its belief that increasing the number of

medical malpractice cases resolved through arbitration, rather than

through the judicial system, would help “assure the continued

availability of adequate health-care services . . . by containing the

significantly increasing costs of malpractice insurance for medical

care institutions.” § 13-64-102(1), C.R.S. 2021.

¶2 But patients cannot be compelled to surrender their right to

sue health care providers in a court of law. The Act specifies that,

although a health care provider may ask a patient to sign an

arbitration agreement, the patient may not be denied care if the

patient refuses to sign the agreement or timely exercises the

statutory right to rescind an arbitration agreement the patient

previously signed. Thus, a patient must be admitted to a hospital,

skilled nursing facility, or other health care facility even though the

patient declined to consent to arbitrate future disputes involving the

facility.

1
¶3 Significantly, although the Act details the steps a health care

provider must take to form an enforceable arbitration agreement

with a patient, it is silent regarding the requirements that a

patient’s agent must satisfy to bind the patient to an arbitration

agreement. In this case, we consider the novel issue of whether an

agent with actual authority to execute the documents required to

admit a patient to a health care facility necessarily also possesses

the authority to bind the patient to an arbitration agreement with

the facility.

¶4 We hold that when an agent has authority to execute the

documents necessary for admission of a patient to a health care

facility, such authority does not, without more, encompass the

authority to bind the patient to an arbitration agreement where the

patient was unaware the facility would ask the agent to sign an

arbitration agreement and the patient never discussed arbitration

with the agent or with representatives of the facility.

¶5 In his lawsuit against defendants, Trinidad Inn, Inc., a skilled

nursing facility; C&G Health Care Management, Inc., which owns,

operates, and manages Trinidad Inn; and Brittnee Fransua, in her

capacity as administrator of Trinidad Inn (collectively, the Trinidad

2
defendants), plaintiff, Ralph R. Fresquez, alleged that their

negligence caused the death of Fresquez’s mother, Beatrice Trujillo,

while she was a resident at Trinidad Inn. The Trinidad defendants

moved to compel arbitration based on an arbitration agreement that

Fresquez signed, purportedly in his capacity as Trujillo’s agent, at

the time of Trujillo’s admission to Trinidad Inn. Following an

evidentiary hearing, the district court denied the Trinidad

defendants’ motion on the grounds that the arbitration agreement

was invalid.

¶6 The Trinidad defendants appeal the district court’s order

denying their motion to compel arbitration. We affirm.

I. Background

¶7 Trujillo decided to move into Trinidad Inn after finding it

difficult to live alone. Fresquez assisted Trujillo with her admission

to Trinidad Inn. As part of this process, he provided the social

services assistant at Trinidad Inn with a referral packet from

Trujillo’s primary care physician. The referral packet included a

note from the physician saying that “attorney is requesting nursing

home placement” for Trujillo. The social services assistant said she

3
believed the reference to “attorney” meant that Trujillo had executed

a power of attorney authorizing Fresquez to act on her behalf.

¶8 Fresquez coordinated Trujillo’s admission to Trinidad Inn with

the social services assistant. The social services assistant testified

that, at the time of Trujillo’s admission, Fresquez told her that he

held a power of attorney for Trujillo. The social services assistant

never saw any such power of attorney, however.

¶9 Fresquez recalled that, shortly after he and Trujillo arrived at

Trinidad Inn for Trujillo’s admission, the social services assistant

called him to her office “to sign . . . papers.” One of those papers

was a “Voluntary Agreement for Arbitration” (the arbitration

agreement). The arbitration agreement stated that “[t]he parties

agree that they shall submit to binding arbitration all disputes

against each other.” It defined the parties as “Trinidad Inn,

including its Owners, Managers, Employees, and Agents,” and “the

Resident.” The arbitration agreement defined “the Resident” as

Trujillo and her “family, estate, heirs, personal representatives, or

. . . any person claiming that a duty of care arises from [Trujillo’s]

stay and care at [Trinidad Inn].”

4
¶ 10 Fresquez later said that he signed the arbitration agreement,

together with the other documents the social services assistant

provided to him, because he believed that Trinidad Inn would not

admit Trujillo if he did not sign it. No representative of Trinidad Inn

discussed the arbitration agreement or the other documents with

Trujillo. Trujillo died six months after her admission to Trinidad

Inn.

¶ 11 In denying the Trinidad defendants’ motion to compel

arbitration, the district court ruled that (1) Fresquez possessed

actual authority to bind Trujillo to the arbitration agreement; (2) the

“rule of equal dignities” invalidated such authority, however,

because no document memorialized Fresquez’s authority; and

(3) Fresquez lacked apparent authority to bind Trujillo to the

arbitration agreement.

II. Analysis

¶ 12 The Trinidad defendants contend that the district court erred

by ruling that the arbitration agreement was invalid. They

specifically argue that Trujillo granted Fresquez actual authority to

bind her to the arbitration agreement and that the equal dignities

rule does not apply here, even though no writing memorialized

5
Fresquez’s authority to act on behalf of Trujillo at the time of

Trujillo’s admission to Trinidad Inn. In the alternative, they

contend that Fresquez possessed apparent authority to bind Trujillo

to the arbitration agreement.

A. Standard of Review

¶ 13 “We review de novo the district court’s decision on a motion to

compel arbitration.” Lujan v. Life Care Ctrs. of Am., 222 P.3d 970,

972 (Colo. App. 2009). “In considering a motion to compel

arbitration, the district court must first determine whether a valid

agreement to arbitrate exists between the parties to the action.” Id.

“The court may properly refuse to compel arbitration only when

there is no valid agreement to arbitrate or when the issue sought to

be arbitrated is clearly beyond the scope of the arbitration

provision.” Id. “Whether a valid agreement to arbitrate exists is a

matter of law that we review de novo.” Id.

¶ 14 In this case, the validity of the arbitration agreement hinges on

the existence and scope of any agency relationship between Trujillo

and Fresquez and, specifically, whether Fresquez possessed the

authority to bind Trujillo to the arbitration agreement. “Whether an

agency relationship exists generally is a question of fact, though the

6
court may decide the question as one of law when the facts are

undisputed.” Villalpando v. Denver Health & Hosp. Auth., 181 P.3d

357, 363 (Colo. App. 2007); see also Gross v. GGNSC Southaven,

L.L.C., 817 F.3d 169, 180 (5th Cir. 2016) (holding that the scope of

a son’s actual authority to bind his mother to a nursing home’s

arbitration agreement was “a question of fact”); Rush Creek Sols.,

Inc. v. Ute Mountain Ute Tribe, 107 P.3d 402, 406 (Colo. App. 2004)

(“The issue of apparent authority is generally an issue of fact to be

determined by the trial court. . . . However, if the underlying facts

are undisputed, fact finding is not required, and the legal effect of

those facts constitutes a question of law.”).

¶ 15 “On appeal, we review the trial court’s factual findings under a

clear error standard.” Villalpando, 181 P.3d at 363. We “won’t

disturb such findings if there is any evidence in the record

supporting them.” Woodbridge Condo. Ass’n v. Lo Viento Blanco,

LLC, 2020 COA 34, ¶ 24, 490 P.3d 598, 606, aff’d, 2021 CO 56,

489 P.3d 735.

7
B. Applicable Law

1. Arbitration Agreements Under the Act

¶ 16 As a general rule, Colorado favors arbitration agreements. See

J.A. Walker Co. v. Cambria Corp., 159 P.3d 126, 128 (Colo. 2007).

But health care arbitration agreements, unlike other types of

arbitration agreements, are subject to strict requirements set forth

in the Act. See § 13-64-403, C.R.S. 2021. Although “the [Act]

allows arbitration of disputes, [it] also contains protective provisions

curbing abusive practices in obtaining agreements to arbitrate.”

Moffett v. Life Care Ctrs. of Am., 219 P.3d 1068, 1073 (Colo. 2009).

¶ 17 The Act provides that arbitration agreements must be

voluntary. § 13-64-403(1) (“It is the intent of the general assembly

that an arbitration agreement be a voluntary agreement between a

patient and a health-care provider . . . .”). It specifies that “[n]o

health-care provider shall refuse to provide medical care services to

any patient solely because such patient refused to sign [an

arbitration agreement] or exercised the ninety-day right of

rescission.” § 13-64-403(7). Health care providers must include

this statutory language, among other required disclosures, in any

agreement with a patient containing an arbitration provision.

8
§ 13-64-403(4). The statement must appear “[i]mmediately

preceding the signature lines for such an agreement . . . printed in

at least ten-point, bold-faced type.” Id. A health care provider’s

failure to comply with these statutory requirements renders a

health care arbitration agreement unenforceable. Johnson v.

Rowan Inc., 2021 COA 7, ¶ 24, 488 P.3d 1174, 1179.

2. Actual Authority

¶ 18 “[A]n agent acts with actual authority when, at the time of

taking action that has legal consequences for the principal, the

agent reasonably believes, in accordance with the principal’s

manifestations to the agent, that the principal wishes the agent so

to act.” State Farm Mut. Auto. Ins. Co. v. Johnson, 2017 CO 68,

¶ 21, 396 P.3d 651, 656 (quoting Restatement (Third) of Agency

§ 2.01 (Am. L. Inst. 2006)). Actual authority is premised on “a

principal’s expressive conduct toward an agent, through which the

principal manifests assent to be affected by the agent’s action, and

the agent’s reasonable understanding of the principal’s

manifestation.” Restatement (Third) of Agency § 2.01 cmt. c.

¶ 19 “The focal point for determining whether an agent acted with

actual authority is the agent’s reasonable understanding at the time

9
the agent takes action.” Id. “An agent has actual authority to take

action designated or implied in the principal’s manifestations to the

agent and acts necessary or incidental to achieving the principal’s

objectives, as the agent reasonably understands the principal’s

manifestations and objectives when the agent determines how to

act.” Id. § 2.02(1). “The context in which principal and agent

interact, including the nature of the principal’s . . . personal

situation, frames the reasonableness of an agent’s understanding of

the principal’s objectives.” Id. § 2.02 cmt. e. “An agent’s actual

authority encompasses acts necessary to accomplish the end the

principal has directed that the agent achieve.” Id.

¶ 20 The inquiry into whether an agent possessed the actual

authority to execute a document on behalf of the principal “contains

both an objective and a subjective component: the agent must

subjectively hold the belief that [he] possesses authority, and that

belief must be objectively reasonable in light of the principal’s

actions.” Stein Eriksen Lodge Owners Ass’n v. MX Techs. Inc., 2022

UT App 30, ¶ 26, 508 P.3d 138, 147 (citing Restatement (Third) of

Agency § 2.02 cmt. e).

10
¶ 21 Actual authority incorporates concepts of express and

implied authority. State Farm, ¶ 21, 396 P.3d at 656. “Express

authority exists when the principal directly states that the agent

may perform a particular act on the principal’s behalf.” Id. In

contrast, implied authority includes “the authority to perform acts

that are ‘incidental to, or are necessary, usual, and proper to

accomplish or perform, the main authority expressly delegated to

the agent.’” Id. at ¶ 22, 396 P.3d at 656 (quoting Willey v. Mayer,

876 P.2d 1260, 1264 (Colo. 1994)); see Restatement (Third) of

Agency § 2.01 cmt. b (stating that implied authority is “actual

authority either (1) to do what is necessary, usual, and proper to

accomplish or perform an agent’s express responsibilities or (2) to

act in a manner in which an agent believes the principal wishes the

agent to act based on the agent’s reasonable interpretation of the

principal’s manifestation in light of the principal’s objectives and

other facts known to the agent”). “Implied authority is actual

authority circumstantially proved.” Citywide Banks v. Armijo, 313

P.3d 647, 652 (Colo. App. 2011).

¶ 22 In Moffett, the supreme court held that a patient’s attorney-in-

fact possesses the authority to bind the patient to an arbitration

11
agreement under the Act where the governing power of attorney

does not limit the agent’s authority “to waive the right to a jury trial

and submit to arbitration” on behalf of the patient. 219 P.3d at

1076. The supreme court concluded in Moffett that the patient’s

attorney-in-fact was authorized to bind the patient to an arbitration

agreement “[a]bsent a restriction or limitation on his authority

under the [power of attorney] he holds.” Id. at 1079. “The [Act] and

Colorado’s recognized policy favoring arbitration coexist with well-

established statutory and common law doctrines governing agency

and [powers of attorney].” Id. at 1074.

¶ 23 For purposes of section 13-64-403, the section of the Act

addressing arbitration agreements, “the term ‘patient’ . . . includes

a person acting with legal authority under a [power of attorney] to

enter into such an agreement on behalf of [an] incapacitated

patient.” Id. The authority of the person acting on behalf of the

patient can arise from a source other than a power of attorney. See

id. at 1078 (“[S]ection 13-64-403 cannot be read without regard for

the extensive statutory and common law doctrine permitting

authorized agents to bind principals in all kinds of contracts,

including arbitration agreements.”); Lujan, 222 P.3d at 977 (holding

12
that a determination of an agent’s scope of authority under a

medical durable power of attorney must include an analysis of the

“common law agency principles or applicable statutory powers of

attorney”) (emphasis omitted).

¶ 24 Moffett teaches that courts must carefully scrutinize the scope

of an agent’s actual authority to determine whether the agent was

empowered to bind a patient to a health care arbitration agreement.

The reasoning of Moffett, therefore, is not limited to cases in which

the principal executed a power of attorney. For this reason, courts

must apply the law of agency, subject to the restrictions imposed

under the Act, to determine whether a patient’s agent is authorized

to waive the patient’s right to seek damages in a court of law.

3. Apparent Authority

¶ 25 In contrast to actual authority, “[a]pparent authority is the

power held by an agent or other actor to affect a principal’s legal

relations with third parties when a third party reasonably believes

the actor has authority to act on behalf of the principal and that

belief is traceable to the principal’s manifestations.” Restatement

(Third) of Agency § 2.03 (emphasis added). “Apparent authority . . .

‘flows only from the acts and conduct of the principal.’” State Farm,

13
¶ 20, 396 P.3d at 656 (quoting Zions First Nat’l Bank v. Clark Clinic

Corp., 762 P.2d 1090, 1095 (Utah 1988)). It is “established by proof

of ‘written or spoken words or other conduct of the principal which,

reasonably interpreted, causes a person to believe that the principal

consents to have the act done on his behalf by a person purporting

to act for him.’” Villalpando, 181 P.3d at 363 (quoting Lucero v.

Goldberger, 804 P.2d 206, 209 (Colo. App. 1990)).

C. Fresquez Lacked Actual Authority to Bind Trujillo to
the Arbitration Agreement

¶ 26 We now turn to the nature of the authority that Trujillo

granted to Fresquez and whether, under that authority, Fresquez

could bind Trujillo to the arbitration agreement. This analysis

requires us to determine the type of authority that Trujillo provided

to Fresquez and the scope of that authority. The parties agree, and

the record reflects, that Trujillo never executed a power of attorney

appointing Fresquez as her agent before Fresquez signed the

arbitration agreement.

1. The District Court Did Not Clearly Err by Finding that
Fresquez Possessed Actual Authority to Make Health Care

14
Decisions and Execute Documents Necessary to Admit Trujillo
to Trinidad Inn

¶ 27 Based on undisputed evidence presented at the hearing, the

district court found that

 Trujillo wanted Fresquez to make decisions regarding her

medical care and her admission to Trinidad Inn;

 Fresquez possessed actual authority to “make admission

decisions and sign documents for the purpose of having

[Trujillo] admitted to Trinidad Inn”;

 before Trujillo’s admission, Trujillo manifested her assent

for Fresquez to sign such documents;

 Fresquez “signed the admission documents so that

[Trujillo] could be admitted” to Trinidad Inn;

 Fresquez “reasonably believed that he was carrying out

[Trujillo’s] wishes when he signed the admission

documents”; and

 “Trujillo’s actions and statements after her admission

corroborate [Fresquez’s] testimony that he was

authorized to make admission decisions and sign

15
documents for the purpose of having her admitted to

Trinidad Inn.”

¶ 28 The evidence confirms that Trujillo wanted Fresquez to act as

her agent in making medical care decisions on her behalf, including

the decisions necessary for her admission to Trinidad Inn. We thus

conclude that the district court did not clearly err by finding that

Fresquez possessed actual authority to make medical care decisions

for Trujillo and to execute the admission documents on her behalf.

2. The District Court Erred by Determining that Fresquez
Possessed Actual Authority to Bind Trujillo to the
Arbitration Agreement

¶ 29 The district court’s characterization of Fresquez’s actual

authority did not stop with its finding that Trujillo authorized

Fresquez to make medical care decisions for her and to execute

Trinidad Inn’s admission documents on her behalf. The district

court also said that, by signing the arbitration agreement, Fresquez

was “making an admission decision for . . . Trujillo” and “the

[arbitration agreement] was within the scope of documents that

[Trujillo] gave [Fresquez] authority to sign.”

¶ 30 These statements can be read in one of two ways. They can be

read as further findings of fact. Alternatively, they can be

16
interpreted as a legal conclusion that, under the Act, Fresquez’s

actual authority “to make admission decisions and sign documents

for the purpose of having her admitted to Trinidad Inn” necessarily

meant he possessed the authority to bind Trujillo to the arbitration

agreement.

¶ 31 If the district court’s statements are findings of fact based on

evidence presented at the hearing, we review them for clear error.

See Villalpando, 181 P.3d at 363. If they are a legal determination,

we review de novo whether, under the Act, Fresquez’s authority to

“make admission decisions” and sign admission documents for

Trujillo necessarily encompassed the authority to bind Trujillo to

the arbitration agreement. See Johnson, ¶ 16, 488 P.3d at 1178.

a. If the District Court’s Statements Regarding Fresquez’s
Authority to Bind Trujillo to the Arbitration Agreement Were
Findings of Fact, They Were Clearly Erroneous

¶ 32 The record does not establish that, based on Trujillo’s

“expressive conduct,” Fresquez reasonably understood that Trujillo

wished for him to waive her right to seek a legal remedy through the

judicial system. See Restatement (Third) of Agency § 2.01 cmt. c

(explaining that determining whether the agent is authorized to

perform certain acts requires both the “principal’s expressive

17
conduct” and the agent’s “reasonable understanding” of the

principal’s wishes manifested through that conduct).

¶ 33 The district court did not find, and the record does not show,

that Trujillo and Fresquez ever discussed the arbitration agreement

specifically or the concept of arbitration generally. The record

contains no evidence that any of Trujillo’s words or conduct related

in any way to arbitration. Therefore, the district court had no

evidentiary basis to support a finding of fact that Fresquez

reasonably understood that Trujillo had granted him actual

authority to bind her to the arbitration agreement.

¶ 34 The Trinidad defendants argue that, because Fresquez made

certain financial and administrative decisions on Trujillo’s behalf,

his actual authority necessarily extended to binding Trujillo to the

arbitration agreement. But the record shows that those financial

and administrative decisions related exclusively to Trujillo’s

admission to and residency at Trinidad Inn. Such decisions were

thus “incidental to, or [were] necessary, usual, and proper to

accomplish or perform, the main authority expressly delegated to

the agent.” State Farm, ¶ 22, 396 P.3d at 656 (quoting Willey, 876

P.2d at 1264); see Restatement (Third) of Agency § 2.01 cmt. b.

18
¶ 35 For the same reasons, to the extent the district court found

that Fresquez reasonably believed he possessed the authority to

bind Trujillo to the arbitration agreement simply because he was

authorized to make health care decisions for her and to sign the

admission documents, such finding was also clearly erroneous.

The arbitration agreement expressly stated, consistent with the Act,

that Trinidad Inn could not “refuse to provide medical care services”

to a patient who declined to sign it. For this reason, the arbitration

agreement cannot be reasonably understood to be an “admission

document.” Thus, nothing in the record indicated that Fresquez

could have reasonably believed, through Trujillo’s expressed wish

that he make health care decisions for her and sign the admission

documents, that he possessed actual authority to bind Trujillo to

the arbitration agreement. Rather, the record shows that, as

Trujillo was being admitted to Trinidad Inn, the social services

assistant handed Fresquez documents and he signed them.

¶ 36 Based on the district court’s findings of fact, supported by the

evidence, that Fresquez’s actual authority included making medical

care decisions for Trujillo and executing the documents necessary

for Trujillo’s admission to Trinidad Inn, we next turn to the legal

19
question of whether, under the Act, such authority necessarily

encompassed the authority to bind Trujillo to the arbitration

agreement.

b. If the District Court’s Statements Regarding Fresquez’s
Authority to Bind Trujillo to the Arbitration Agreement Were a
Legal Determination, They Were Erroneous

¶ 37 “An agent has a duty to take action only within the scope of

the agent’s actual authority.” Restatement (Third) of Agency § 8.09.

In other words, “[i]n the context of the agent’s relationship with the

principal, the boundary of an agent’s rightful action is the scope of

the agent’s actual authority.” Id. § 8.09 cmt. b. “An agent’s actual

authority encompasses acts necessary to accomplish the end the

principal has directed that the agent achieve.” Id. § 2.02 cmt. e; see

also State Farm, ¶ 22, 396 P.3d at 656.

¶ 38 Here, the “end” that Trujillo directed Fresquez to achieve was

her admission to Trinidad Inn so she could receive medical care at

that facility. The district court found that “Trujillo’s actions and

statements after her admission corroborate [Fresquez’s] testimony

that he was authorized to make admission decisions and sign

documents for the purpose of having her admitted to Trinidad Inn.”

(Emphasis added.)

20
¶ 39 In making its determination that Fresquez’s actual authority

regarding health care and admission decisions included the

authority to bind Trujillo to the arbitration agreement, the district

court distinguished Lujan on four grounds: (1) this case does not

involve a health care proxy, and Trujillo was neither incapacitated

nor mentally incompetent at the time of her admission to Trinidad

Inn; (2) Trujillo chose her decision-maker and relied on him for that

purpose; (3) Trujillo “determined that [Fresquez] had authority to

make decisions on her behalf that included decisions related to her

admission at Trinidad Inn”; and (4) this case involves evidence of “a

formal understanding” between Fresquez and Trujillo regarding the

existence and scope of Fresquez’s authority. We disagree that the

reasoning of Lujan is inapposite here.

¶ 40 We acknowledge that, in Lujan, a division of this court

considered whether a designated health care proxy is empowered to

bind an incapacitated patient to an arbitration agreement. 222

P.3d at 971. But, despite the narrowness of the issue presented in

Lujan, the division’s discussion of the distinction between the

documents required to admit a patient to a skilled nursing facility

and an arbitration agreement is pivotal to our analysis. Id. at 973-

21
74. Particularly relevant here, the division contrasted a health care

proxy’s statutorily prescribed authority with the more expansive

authority that a principal-agent relationship can create. Id. at 973.

¶ 41 “[A] health care proxy is distinct from an attorney-in-fact

acting under a power of attorney.” Id. at 977. The division

reasoned that “the statutory authority afforded a health care proxy

should be construed narrowly, unlike the broad powers presumed

to be afforded under a medical durable power of attorney.” Id.; see

also Moffett v. Life Care Ctrs. of Am., 187 P.3d 1140, 1145 (Colo.

App. 2008) (“[A]bsent a limitation in the medical durable power of

attorney, an attorney-in-fact can make exactly the same types of

medical treatment decisions that the principal could make if he or

she had the mental capacity to do so.”), aff’d, 219 P.3d 1068.

¶ 42 Lujan’s reasoning is not limited to cases involving health care

proxies, which are executed on behalf of a patient who “lacks

decisional capacity to provide informed consent to or refuse medical

treatment.” 222 P.3d at 972. The division in Lujan noted the “clear

legislative intent to distinguish between an agreement to provide

medical services (including an agreement to admit a patient to a

22
health care facility) and an agreement to arbitrate a health care

dispute.” Id. at 974 (citing § 13-64-403(7)).

¶ 43 For purposes of the health care proxy provisions at issue in

Lujan, “medical treatment” means “specific medical procedures

(e.g., artificial nourishment and hydration) or forms of healing (e.g.,

religious and spiritual healing).” Id. (citing § 15-18.5-101(1)(a), (2),

C.R.S. 2021). In addition, the part of the probate code addressing

powers of attorney similarly defines “‘medical treatment’ as ‘the

provision, withholding, or withdrawal of any health care, medical

procedure, including artificially provided nourishment and

hydration, surgery, cardiopulmonary resuscitation, or service to

maintain, diagnose, treat, or provide for a patient’s physical or

mental health or personal care.’” Id. at 973 (quoting

§ 15-14-505(7), C.R.S. 2021).

¶ 44 According to the division in Lujan, under either definition, an

agent’s authority to make decisions regarding a patient’s “medical

treatment” does not encompass the authority to sign an arbitration

agreement. Id. at 974. Importantly, the division in Lujan held that

a decision to execute an arbitration agreement “is not integral to a

patient’s health and well-being.” Id. at 976. Instead, a decision to

23
arbitrate pertains exclusively to a person’s legal rights and

remedies. See Colo. Const. art. XVIII, § 3; §§ 13-22-201 to -230,

C.R.S. 2021. Thus, a decision to arbitrate, or not to arbitrate, is

fundamentally different from a decision involving medical

treatment.

¶ 45 In examining the scope of the authority granted to an agent

through a health care proxy, the Lujan court noted section

13-64-403(7)’s express prohibition on conditioning the provision of

medical services upon execution of an arbitration agreement.

Lujan, 222 P.3d at 974. The General Assembly’s decision to delink

the concept of arbitration from the concept of providing medical

services underscores that granting an agent authority to make

medical care decisions for a patient does not authorize the agent to

waive the patient’s right to seek relief in a court of law. Thus, the

authority of an agent to execute an arbitration agreement on behalf

of a patient must rest on a source other than the agent’s

authorization to make health care decisions for the patient.

¶ 46 Following the compelling logic of Lujan and the language of the

Act, we hold that an agent’s actual authority to make health care

decisions for a patient and to sign the documents necessary to

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admit the patient to a health care facility does not encompass the

authority to bind the patient to an arbitration agreement, unless

the patient has granted the agent an unlimited power of attorney or

otherwise clearly granted the agent the specific authority to bind

the patient to an arbitration agreement. Thus, we conclude that, as

a matter of law, the scope of Fresquez’s actual authority did not

extend to binding Trujillo to the arbitration agreement. In light of

our holding, we need not consider whether the district court erred

by holding that Fresquez lacked authority to bind Trujillo to the

arbitration agreement under the rule of equal dignities.

D. The District Court Did Not Err By
Finding That Fresquez Lacked Apparent Authority

¶ 47 Having concluded that Fresquez lacked actual authority to

bind Trujillo to the arbitration agreement, we next review the

district court’s determination that he also lacked apparent authority

to do so. “The issue of apparent authority is generally an issue of

fact to be determined by the trial court.” Rush Creek, 107 P.3d at

406. Apparent authority can apply to “agents who act beyond the

scope of their actual authority.” Restatement (Third) of Agency

§ 2.03 cmt. a.

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¶ 48 We conclude that the district court did not clearly err by

making this finding.

1. Fresquez Did Not Have Apparent Authority to
Bind Trujillo to the Arbitration Agreement

¶ 49 The Trinidad defendants argue that the district court erred by

requiring that “a principal’s manifestation of an agent’s authority to

act be made prior to the act in question.” They contend that the

district court improperly inserted a temporal requirement into the

apparent authority analysis by considering only Trujillo’s

statements and conduct preceding Fresquez’s execution of the

arbitration agreement. They further argue that the Restatement of

Agency rejects this temporal requirement by providing that

apparent authority “applies to any set of circumstances under

which it is reasonable for a third party to believe that an agent has

authority.” Restatement (Third) of Agency § 2.03 cmt. c (emphasis

added).

¶ 50 We need not consider the timing of a principal’s

manifestations of an agent’s apparent authority, however, because

the record lacks any evidence that Trujillo ever gave any

manifestations regarding arbitration. As the district court found,

26
Trujillo generally knew of and authorized Fresquez to sign the

documents and make the decisions related to her admission to and

care at Trinidad Inn, both before and after she moved in. But the

Trinidad defendants could not have reasonably believed that

Fresquez also possessed apparent authority to sign the arbitration

agreement on Trujillo’s behalf.

¶ 51 The district court based its finding that Fresquez lacked

apparent authority to bind Trujillo to the arbitration agreement on

the testimony of the social services assistant and Fransua, Trinidad

Inn’s administrator, at the hearing. Those employees conceded

that, before Trujillo’s admission to Trinidad Inn, she did not make

any manifestation to them, whether by word or deed, that Fresquez

was authorized to bind her to the arbitration agreement.

¶ 52 Indeed, nothing Trujillo said or did at any time suggested that

she was aware of the arbitration agreement or that she intended to

grant Fresquez the authority to sign away her right to a trial in a

court of law. Moreover, the record does not contain any evidence

suggesting that Trujillo ever learned of the existence of the

arbitration agreement.

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¶ 53 The social services assistant’s and Fransua’s testimony does

not indicate otherwise. The social services assistant testified that

(1) she received paperwork from Trujillo’s referring doctor saying

that Trujillo’s “attorney” wanted Trujillo to move to a nursing home;

(2) the social services assistant coordinated Trujillo’s move to

Trinidad Inn with Fresquez; and (3) Fresquez signed the admission

documents while Trujillo settled into her room. Fransua testified

that she believed Fresquez was Trujillo’s representative for purposes

of signing the arbitration agreement because he “was present with

[Trujillo] in asking [the primary care physician] for the nursing

home placement,” and he and Trujillo “work[ed] towards that goal of

getting [Trujillo] in the nursing home.” This testimony supports the

district court’s finding that Fresquez lacked apparent authority to

bind Trujillo to the arbitration agreement.

¶ 54 Although the district court found that Fresquez told the

Trinidad defendants he was Trujillo’s attorney-in-fact, neither the

social services assistant nor Fransua ever saw such a power of

attorney. (A power of attorney must be in writing. See Willey, 876

P.2d at 1264 (explaining that a power of attorney is “a written

document by which one party, as principal, appoints another as

28
agent (attorney-in-fact) and confers upon the latter the authority to

perform certain specified acts or kinds of acts on behalf of the

principal”).)

¶ 55 Further, the Trinidad defendants contend that the purpose of

the apparent authority doctrine is to “protect[] third parties who, in

good faith, rely on their belief that an agency relationship exists

between the apparent principal and agent.” See Villalpando, 181

P.3d at 363. But nothing in the record shows that they relied on

their belief that Fresquez possessed the authority to bind Trujillo to

the arbitration agreement. As noted in Part II.B.1 supra, Trinidad

Inn could not have refused admission to Trujillo even if the Trinidad

defendants learned at the time that Trujillo had not executed a

power of attorney. Thus, consistent with section 13-64-403 of the

Act, the validity of the arbitration agreement, and Fresquez’s

authority to bind Trujillo to it, was of no consequence to Trinidad

Inn’s decision to admit Trujillo.

¶ 56 The Trinidad defendants further assert that their reliance on

Trujillo’s manifestations following Fresquez’s execution of the

arbitration agreement “caused [them] to forebear pressing further

for the power of attorney . . . or to request a signature from . . .

29
Trujillo” on the arbitration agreement. But nothing in the record

supports this assertion.

¶ 57 Indeed, the social services assistant asked Fresquez to provide

her with a copy of the power of attorney after Trujillo’s admission.

But she dropped the subject after contacting him about it “a few

times.” The social services assistant’s testimony undercuts the

Trinidad defendants’ argument that Trujillo’s manifestations caused

them to forebear pressing Fresquez further for the purported power

of attorney. The social services assistant did not say that she

stopped asking Fresquez for the power of attorney based on

anything Trujillo said or did. And nothing in the record indicates

that Trujillo would have signed the arbitration agreement if Trinidad

Inn had asked her to do so or that Trujillo’s manifestations induced

the Trinidad defendants not to ask her to sign it.

¶ 58 In sum, Trujillo’s words and actions indicated only that

Fresquez possessed the authority to make decisions related to

Trujillo’s medical care and her admission to Trinidad Inn. Trujillo

never made any manifestations indicating that Fresquez also had

the authority to bind her to the arbitration agreement. See Lujan,

222 P.3d at 976. Thus, we affirm the district court’s determination

30
that Fresquez lacked apparent authority to execute the arbitration

agreement on Trujillo’s behalf.

2. Trujillo Did Not Ratify the Arbitration Agreement

¶ 59 For the same reasons, we conclude that Trujillo did not ratify

the arbitration agreement. The Trinidad defendants argue that,

even if Fresquez lacked apparent authority to bind Trujillo to the

arbitration agreement, Trujillo later ratified his execution of the

arbitration agreement through her “knowledge that [Fresquez] was

making decisions on her behalf without objection — even without

specific knowledge of the [arbitration agreement].”

¶ 60 Ratification occurs “when a party ‘with knowledge of all

material facts’ adopts and confirms an act performed or entered

into on his behalf by another, without authorization.” Fiscus v.

Liberty Mortg. Corp., 2014 COA 79, ¶ 40, 373 P.3d 644, 652

(quoting Siener v. Zeff, 194 P.3d 467, 471 (Colo. App. 2008)), aff’d

on other grounds, 2016 CO 31, 379 P.3d 278. Here, Trujillo did not

possess “full knowledge of all material facts.” Id. The district court

did not find that Trujillo ever knew of the existence or terms of the

arbitration agreement.

31
¶ 61 Therefore, we conclude that Trujillo did not ratify Fresquez’s

execution of the arbitration agreement.

III. Conclusion

¶ 62 The order denying the Trinidad defendants’ motion to compel

arbitration is affirmed, and the case is remanded for further

proceedings consistent with this opinion.

JUDGE NAVARRO and JUDGE KUHN concur.

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