Regional Care Facilities, Inc. v. Rose Care, Inc.

912 S.W.2d 406, 322 Ark. 780, 1995 Ark. LEXIS 742
CourtSupreme Court of Arkansas
DecidedDecember 18, 1995
Docket95-463
StatusPublished
Cited by12 cases

This text of 912 S.W.2d 406 (Regional Care Facilities, Inc. v. Rose Care, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Regional Care Facilities, Inc. v. Rose Care, Inc., 912 S.W.2d 406, 322 Ark. 780, 1995 Ark. LEXIS 742 (Ark. 1995).

Opinion

Tom Glaze, Justice.

This appeal is a companion one to Regional Care Facilities, Inc. v. Rose Care, Inc., No. 95-458, which is also decided today. While these two cases have not been consolidated, the procedural events in each are the same and are important in deciding the respective appeals. While not mentioned in case no. 95-458, a brief discussion of the statutory history giving rise to these cases might be helpful.

In 1987, the General Assembly enacted statutes forming the Arkansas Health Services Commission and the Arkansas Health Services Agency to evaluate the availability and adequacy of health facilities and health services related to long-term care facilities and home health care service agencies. Through Act 422 of 1989, the General Assembly imposed a moratorium on the construction of new home health care agencies or nursing homes from March 8, 1989, until June 1, 1989. As part of that Act, the Commission was empowered to remove “any and all of the moratoria any time after June 1, 19891, provided the Commission has duly adopted and promulgated standards for the review of the health facility for which the moratorium is removed.” Ark. Code Ann. § 20-8-106(a)(1) (Repl. 1991). Subsequently, the Commission promulgated the “Arkansas Health Services Commission Policies and Procedures for Permit of Approval Review.”

As is factually set out in companion appeal no. 95-458, the Health Services Agency in February 1992, published notice that a permit of approval (POA) would be issued by the Health Services Commission for one 70-bed nursing home facility in Benton County. Four applications to construct the facility were submitted. Regional Care Facilities, Inc. (Regional), filed two applications, one for a 70-bed unit in Rogers and one for a 70-bed facility in Bentonville. Rose Care applied to build a 70-bed facility in Bentonville. The other application was filed by Innisfree for a 70-bed nursing home in Rogers.

The Agency “in considering the need for only one facility” recommended to the Commission that the POA be awarded to Innisfree. Included in the Agency recommendation, however, was the statement that the Commission “might consider approving a second facility.” The Agency recommended that a second POA be granted to Regional for the construction of a 70-bed unit in Bentonville.

The Agency then notified the applicants of its recommendations and published notice of a Commission hearing on “Proposals for new 70-bed nursing homes.” At the hearing, each of the applicants discussed its application. The Rose Care representative voiced concern over the possibility of the approval of a second POA and referred to the lack of notice concerning the second POA.

The Commission followed the Agency recommendations and awarded one POA to Innisfree for a 70-bed facility in Bentonville and endorsed the Agency’s recommendation to award an additional POA for seventy beds to Regional. Notice of the decision was sent to the applicants, and Rose Care filed an appeal with the Commission seeking, in effect, reconsideration of its decision. The Commission set a hearing for September 30, 1992, to consider Rose Care’s review requests. However, while the administrative review hearing was still pending before the Commission, Rose Care filed its complaint against the Agency and Commission on September 28, 1992, in circuit court, wherein it alleged it anticipated the Commission would grant the second POA to Regional at the scheduled September 30, 1992 hearing unless the court enjoined the permit’s issuance. On September 28, 1992, the circuit court granted Rose Care’s request for injunctive relief by entering an ex parte order.1 Regional later was allowed to intervene, and among other things, it contended Rose Care’s lawsuit was premature because no final Agency (Commission) decision had been made at the time the court’s ex parte restraining order was issued. In sum, Regional, the Agency, and the Commission requested summary judgment be granted, contending Rose Care had failed to exhaust its administrative remedies, and the circuit court was without jurisdiction to have issued its ex parte order. We agree.

Citing Ark. Code Ann. § 25-15-207(d), Rose Care submits it was not required to exhaust its administrative remedies before seeking a declaratory order from the court. That statute provides as follows:

(d) A declaratory judgment may be rendered whether or not the plaintiff has requested the agency to pass upon the validity or applicability of the rule in question.

It is important to emphasize at this point that declaratory actions are intended to supplement rather than replace ordinary causes of action. Rehab Hospital Services Corp. v. Delta-Hills Health Systems Agency, Inc., 285 Ark. 344, 687 S.W.2d 840 (1985). In Rehab,, the Arkansas State Health Planning and Development Agency granted a certificate to Rehab Hospital to construct a hospital in Jonesboro. Delta-Hills Health Systems Agency filed a motion for reconsideration after conducting a telephone poll of its executive committee and before any action was taken on the motion, Rehab filed suit in circuit court alleging the reconsideration motion should be voided since Delta-Hill’s telephone poll violated the Freedom of Information Act. In upholding the trial court’s decision refusing to void the motion, this court stated:

It seems to be now a recognized doctrine that requires administrative relief to be sought before resorting to declaratory procedure, wherever administrative relief is afforded and this requirement is not one merely requiring the initiation of administrative procedure, but the administrative procedure must be pursued to its final conclusion before resort may be had to the court for declaratory relief

The Rehab decision is consistent with prior law on this subject. For example, the court in Boyett v. Boyett, 296 Ark. 36, 598 S.W.2d 86 (1980), stated that declaratory relief is not proper when the identical questions involved in the declaratory judgment proceeding are already at issue between the parties in a pending action. The court further said that declaratory judgment procedure is not proper as a means of trying a case, or various issues involved in it, by piecemeal. In Consumers Co-op Assn. v. Hill, 233 Ark. 59, 342 S.W.2d 657 (1961), this court held that failure to seek a rehearing before an administrative agency was failure to exhaust administrative remedies where rehearing could have cleared up a confusing ruling. See also Arkansas Motor Vehicle Comm’n v. Cantrell Marine, Inc., 305 Ark. 449, 808 S.W.2d 765 (1991).

This court in Barr v. Arkansas Blue Cross & Blue Shield, Inc., 297 Ark. 262, 761 S.W.2d 174 (1988), recognized that the exhaustion of administrative remedies is not required where no genuine opportunity for adequate relief exists or where irreparable injury will result if the complaining party is compelled to pursue administrative remedies. That is not the situation here.

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912 S.W.2d 406, 322 Ark. 780, 1995 Ark. LEXIS 742, Counsel Stack Legal Research, https://law.counselstack.com/opinion/regional-care-facilities-inc-v-rose-care-inc-ark-1995.