Noland Health Services, Inc. v. State Health Planning & Development Agency

44 So. 3d 1074, 2010 Ala. LEXIS 28, 2010 WL 753336
CourtSupreme Court of Alabama
DecidedMarch 5, 2010
Docket1061418
StatusPublished
Cited by6 cases

This text of 44 So. 3d 1074 (Noland Health Services, Inc. v. State Health Planning & Development Agency) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Noland Health Services, Inc. v. State Health Planning & Development Agency, 44 So. 3d 1074, 2010 Ala. LEXIS 28, 2010 WL 753336 (Ala. 2010).

Opinion

PER CURIAM.

Noland Health Services, Inc., and its subsidiary, Long Term Hospital of Huntsville, LLC (hereinafter referred to collectively as “Noland”), appeal part of the Montgomery Circuit Court’s decision in Noland’s declaratory-judgment action against the State Health Planning and Development Agency (“SHPDA”); Select Medical Corporation and its subsidiary, Select Specialty Hospital-Huntsville, Inc. (hereinafter referred to collectively as “Select”); and HealthSouth Corporation and its subsidiary, HealthSouth LTCH of Huntsville, Inc. (hereinafter referred to collectively as “HealthSouth”). We affirm in part and reverse in part.

Facts and Procedural History

In 2004, Noland, Select, and Health-South filed competing applications with SHPDA for a certificate of need (“CON”) to provide a new health-care facility in Huntsville. Pursuant to SHPDA’s regulations, each applicant timely intervened and requested contested-case proceedings concerning the other applicants’ projects. The competing applications were consolidated by the administrative law judge assigned to conduct the contested-case hearing under § 22-21-275(6), Ala.Code 1975.

Under § 22-21-275(3), Ala.Code 1975, once SHPDA determines that an application for a CON is complete and notification of that fact is made to the applicant, SHPDA’s Certificate of Need Review Board (“CONRB”) must complete its review of the application and make a decision within 90 days, but SHPDA may extend the review period for 30 days without the consent of the applicant, and the review period may be extended without limitation with the written consent of the applicant. Also, in accordance with SHPDA’s longstanding practice and its interpretation of its own rules, SHPDA suspends the 90-day review period from the date a request [1076]*1076is made for “contested-case” proceedings to the date the administrative law judge files his or her recommendation with SHPDA. Under § 22-21-275(3), Ala.Code 1975, “[i]f the state agency does not make a decision within the period of time specified for state agency review, the proposal shall be deemed to have been found not to be needed.”

In the present situation, the 90-day review period for each project would have terminated within the 30 days immediately preceding the CONRB’s scheduled monthly meeting on January 18, 2006. However, SHPDA extended the review period in accordance with § 22-21-275(3) and placed the matter on the agenda for the January 2006 CONRB meeting. At the commencement of the January meeting, the CONRB determined that, because of the recusal of some of the members, there was not a quorum present to consider the applications. See Ex parte Shelby Med. Ctr., Inc., 564 So.2d 63, 66-67 (Ala.1990) (holding that approval of a CON by SHPDA requires approval by a majority of a quorum of the agency’s nine-member CONRB (citing §§ 41-22-15 and 41-22-3(8), Ala.Code 1975)). With the consent of each applicant on the record, the matter was continued to the next scheduled meeting of the CONRB, which was on February 15, 2006. However, at the February meeting, the CONRB was again unable to convene a quorum to consider the applications. Written consent of the applicants to extend the review period further was not obtained. SHPDA then placed consideration of the applications on the agenda for the CONRB meeting scheduled for March 2006, but the CONRB was again unable to convene a quorum to consider the applications at that meeting.

On April 4, 2006, Select’s counsel wrote a letter to SHPDA’s executive director, Alva Lambert, requesting that all three applications be deemed denied by SHPDA because a majority of the CONRB’s members had recused themselves and the agency had failed to make a decision during the period specified for state-agency review under the applicable statutes and regulations.

On May 12, 2006, Noland sued SHPDA, Select, and HealthSouth, requesting a judgment declaring that each of the applications was deemed denied as a result of the failure of the CONRB to make a decision within the applicable period for review and that the time within which any of the applicants could have requested judicial review of the denial of the applications had expired, making any appeal of such denials untimely. Noland also requested that the circuit court enter an injunction staying any further consideration of the applications by the CONRB.

After conducting a hearing and reviewing written submissions, the circuit court, on May 15, 2007, held that “the applications are denied as a matter of law due to the failure and continuing inability of the CONRB to convene a quorum to consider the cases and that the CONRB is without power to take any action in this case in the absence of a quorum, including issuance of a ‘final order.’” None of the parties appealed that holding. However, the circuit court further held that “all applicable appellate deadlines to [the] Circuit Court run from the date of [this] order.” Noland appeals that holding.

On June 16, 2009, HealthSouth voluntarily withdrew its CON application and its intervention in Noland’s and Select’s CON applications. Accordingly, on June 18, 2009, Noland moved this Court to dismiss HealthSouth from this appeal, and on June 24, 2009, HealthSouth moved this Court to dismiss it from this appeal. On June 26, 2009, this Court granted the motions and [1077]*1077dismissed the appeal only as to Health-South.

Standard of Review

Our standard of review is de novo: “Because the issues presented by [this appeal] concern only questions of law involving statutory construction, the standard of review is de novo. See Taylor v. Cox, 710 So.2d 406 (Ala.1998).” Whitehurst v. Baker, 959 So.2d 69, 70 (Ala.2006).

Discussion

On appeal, Noland has raised an issue of first impression regarding the interpretation of § 41-22-20(d), Ala.Code 1975, which provides for judicial review in the circuit court of an agency’s decision in a contested case. Section 41 — 22—20(d) provides, in part: “The notice of appeal or review shall be filed within 30 days after the receipt of the notice of or other service of the final decision of the agency upon the petitioner or, if a rehearing is requested under Section 41-22-17, within 30 days after the receipt of the notice of or other service of the decision of the agency thereon.”

Noland argues that no action was required by SHPDA to trigger the running of the 30-day period under § 41-22-20(d) for filing a notice of appeal and that the circuit court erred in holding that the time for filing a notice of appeal began to run on the date of the circuit court’s order. Noland contends that the time for filing the notice of appeal began to run when the applications were denied by operation of law and that the time for filing the notice of appeal had already expired when the circuit court issued its order. Select responds that under the Alabama Administrative Procedure Act (“AAPA”), § 41-22-1 et seq., Ala.Code 1975, an administrative agency has a mandatory duty to issue a final written order and to serve it on all affected parties and that the right to appeal an adverse administrative decision arises on the date the agency issues its final written order and serves it on all affected parties, not on the date the agency makes its final decision. Specifically, Select argues that the 30-day period under § 41-22-20(d) for filing a notice of appeal cannot begin to run until the parties receive a final written order.

In City of Bessemer v. McClain,

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44 So. 3d 1074, 2010 Ala. LEXIS 28, 2010 WL 753336, Counsel Stack Legal Research, https://law.counselstack.com/opinion/noland-health-services-inc-v-state-health-planning-development-agency-ala-2010.