Jackson-Madison County General Hospital District v. Health Facilities Commission

CourtCourt of Appeals of Tennessee
DecidedNovember 28, 2001
DocketM1999-02804-COA-R3-CV
StatusPublished

This text of Jackson-Madison County General Hospital District v. Health Facilities Commission (Jackson-Madison County General Hospital District v. Health Facilities Commission) is published on Counsel Stack Legal Research, covering Court of Appeals of Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Jackson-Madison County General Hospital District v. Health Facilities Commission, (Tenn. Ct. App. 2001).

Opinion

IN THE COURT OF APPEALS OF TENNESSEE AT NASHVILLE July 2, 1999 Session

JACKSON-MADISON COUNTY GENERAL HOSPITAL DISTRICT v. TENNESSEE HEALTH FACILITIES COMMISSION, ET AL.

Appeal from the Chancery Court for Davidson County No. 98-3210-I Irvin H. Kilcrease, Jr., Chancellor

No. M1999-02804-COA-R3-CV - Filed November 28, 2001

This appeal involves a dispute between two hospitals regarding one hospital’s desire to expand its intensive care and open-heart surgery services. After Methodist Healthcare-Jackson Hospital applied to the Tennessee Health Facilities Commission for a certificate of need, Jackson-Madison County General Hospital District objected on the ground that the proposed services would unnecessarily duplicate services it was already providing. Even though the Commission denied the application, the Commission’s staff issued the certificate of need after the Attorney General and Reporter opined that the Commission’s vote on reconsideration was inconsistent with the Commission’s enabling statute. Rather than pursuing a contested case hearing before the Commission, Jackson-Madison County filed a petition for common-law writ of certiorari in the Chancery Court for Davidson County asserting that the Commission’s vote to deny the certificate of need was proper and that one Commission member who voted to approve the certificate should have been disqualified because of a financial conflict of interest. The trial court granted the writ of certiorari but, following a hearing, dismissed the writ because Jackson-Madison County had not exhausted its administrative remedies. Jackson-Madison County appealed to this court. While this appeal was pending, Jackson- Madison County requested and received a contested case hearing before an administrative law judge sitting in place of the Commission. After the administrative law judge determined that the Commission’s vote to deny Methodist Healthcare’s application for a certificate of need was proper and that one of the Commission members who voted to grant the certificate of need should have been disqualified, Jackson-Madison County moved to dismiss its appeal. Methodist Healthcare opposed dismissing the appeal. We have determined that the trial court properly dismissed Jackson-Madison County’s petition for writ of certiorari and that this appeal should be dismissed.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed; Appeal Dismissed

WILLIAM C. KOCH , JR., J., delivered the opinion of the court, in which BEN H. CANTRELL , P.J., M.S., and WILLIAM B. CAIN , J., joined.

William M. Barrick and William R. Willis, Jr., Nashville, Tennessee, for the appellant, Jackson- Madison County General Hospital District.

J. Richard Lodge, Jr., Robert E. Cooper, and W. Brantley Phillips, Jr., Nashville, Tennessee, for the appellee, Methodist Healthcare-Jackson Hospital. Paul G. Summers, Attorney General and Reporter, and Michelle Hohnke Joss, Assistant Attorney General, for the appellee, Tennessee Health Facilities Commission.

OPINION

I.

Sometime in 1998, Methodist Healthcare-Jackson Hospital (“Methodist Healthcare”) applied to the Tennessee Health Facilities Commission for a certificate of need to undertake a $20,355,810 expansion of its facility for the purpose of initiating neonatal intensive care and open heart surgery services. On September 11, 1998, Jackson-Madison County General Hospital District (“Jackson- Madison County”) filed written objections to Methodist Healthcare’s application asserting that the expanded services were not needed and would duplicate services it was already providing.

The Commission took up Methodist Healthcare’s application at its September 23, 1998 meeting. After presentations from both sides, the Commission initially decided by a six to five vote to grant Methodist Healthcare’s application. Following a recess, the commission member who had made the motion to grant Methodist Healthcare’s application moved to reconsider the vote.1 The Commission adopted the motion by a vote of six to five. Thereafter, the Commission, by a six to five vote, denied Methodist Healthcare’s application for a certificate of need, finding that the proposed expansion was neither needed nor economically feasible and that it would not contribute to the development of adequate and effective healthcare in the area.

Methodist Healthcare’s narrow defeat raised questions about the propriety of the Commission’s reconsideration of its initial decision. Even though the Commission had followed a similar procedure in earlier hearings, some questioned whether its second vote was inconsistent with Tenn. Code Ann. § 68-11-108(e) (Supp. 2000).2 Accordingly, both the Commission and a state senator requested the Attorney General and Reporter to render a formal opinion3 regarding whether the Commission’s reconsideration of its decision regarding Methodist Healthcare’s application was inconsistent with Tenn. Code Ann. § 68-11-108(e). On October 1, 1998, the Attorney General issued an opinion that the Commission did not have the authority to reconsider its initial decision and that all the Commission’s actions after the initial vote were of no effect.4

On October 23, 1998, Jackson-Madison County filed a petition for writ of certiorari and writ of supersedeas in the Circuit Court for Davidson County seeking judicial review of the Commission’s proceedings on two grounds. First, Jackson-Madison County asserted that one of the

1 The Com mission’s minutes reflect that the comm issioner who had originally move d to grant M ethodist Healthcare’s app lication had been confuse d and had m ade a “mistake.”

2 Tenn. Code Ann. § 68-11-108(e) provides, in part: “The commission’s decision to approve or deny an app lication sh all be final and shall not be reco nsidered.”

3 Tenn. Code A nn. § 8-6-109(b)(6) (1993 ) requires the Attorney Genera l and R epo rter to furnish written legal opinions to state o fficials on all matters submitted by them in the discharge of their official duties.

4 Op. T enn. Att’y Gen., No. 98-187 (Oct. 1, 1998).

-2- Commission members who had voted in favor of granting Methodist Healthcare’s application for a certificate of need should have recused himself because his company had a “direct financial relationship” with both Jackson-Madison County and Methodist Healthcare.5 Second, it asserted that the announced intention of the Commission’s staff to issue the certificate of need notwithstanding the Commission’s decision to deny it was arbitrary, capricious, and unlawful.

On October 28, 1998, the circuit court transferred the petition to the Chancery Court for Davidson County, and one of the chancellors signed a fiat directing the clerk and master to issue the writ of certiorari directing the Commission to forward the record of its proceedings involving Methodist Healthcare’s application for a certificate of need to the court. However, the trial court did not issue a writ of supersedeas that would have prevented the Commission from issuing the certificate of need to Methodist Healthcare.6

The Commission met later in the day on October 28, 1998. During this meeting, the Commission’s general counsel informed the Commission of the actions taken by the trial court earlier in the day and explained her understanding of the significance of the Attorney General’s October 1, 1998 opinion.

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Jackson-Madison County General Hospital District v. Health Facilities Commission, Counsel Stack Legal Research, https://law.counselstack.com/opinion/jackson-madison-county-general-hospital-district-v-tennctapp-2001.