Third Party Beneficiary Doctrine- September 22, 2016 Supreme Court of Florida Opinion

What is the third party beneficiary doctrine? Does it bind a third party to an arbitration clause in an agreement? What did the Supreme Court of Florida have to say last week regarding this issue? What should Florida probate litigators and trust and estates lawyers know about the third party beneficiary doctrine?

Mendez v. Hampton Court Nursing Center, LLC

• In Mendez v. Hampton Court Nursing Center, LLC, the Supreme Court of Florida “held that third party beneficiary doctrine did not bind a nursing home resident to an arbitration clause in an admission agreement.”
• What is the third party beneficiary doctrine?
• “The doctrine of third party beneficiaries provides that under certain circumstances, a person may sue to enforce a contract, even though the person is not a party to the contract.”
• Here, a son admitted his father to a nursing home in Florida.
• The son signed a contract that contained an arbitration provision.
• In this context, the Supreme Court of Florida said that the father, who was the third party beneficiary, was not bound by the arbitration provision in the contract that he did not sign.
• The Supreme Court of Florida explains that the doctrine “enables a non-contracting party to enforce a contract against a contracting party, not the other way around.”
• Here the contracting party was trying to enforce a contract against a non-contracting party.
• To read the full opinion, click here.