South Carolina              
Administrative Law Court
Edgar A. Brown building 1205 Pendleton St., Suite 224 Columbia, SC 29201 Voice: (803) 734-0550

SC Administrative Law Court Decisions

CAPTION:
Amisub of South Carolina, Inc., d/b/a Piedmont Medical Center vs. SCDHEC, et al

AGENCY:
South Carolina Department of Health and Environmental Control

PARTIES:
Petitioners:
Amisub of South Carolina, Inc., d/b/a Piedmont Medical Center

Respondents:
South Carolina Department of Health and Environmental Control and Charlotte Mecklenburg Hospital Authority, d/b/a Carolinas Healthcare System
 
DOCKET NUMBER:
08-ALJ-07-0063-CC

APPEARANCES:
n/a
 

ORDERS:

ORDER DISMISSING CASE

This matter comes before the Administrative Law Court (ALC or Court) pursuant to a request for a Contested Case Hearing pursuant to S.C. Code Ann. § 44-1-60 (Supp. 2007) and S.C. Code Ann. § 1-23-600(A) (as amended by 2008 S.C. Act No. 334). After previous hearings and orders in this matter, regarding enforcing the automatic stay provisions of S.C. Code Ann. § 1-23-600(H) (Supp. 2007) and subsequently lifting the automatic stay, Respondent Charlotte-Mecklenburg Hospital Authority d/b/a Carolinas Healthcare System (Carolinas), moved to dismiss this case. A hearing was held regarding this issue on September 10, 2008.

BACKGROUND[1]

Mecklenburg Hospital Authority, d/b/a Carolinas Healthcare System (Carolinas), a health care facility in North Carolina, seeks to construct an office building in Fort Mill, South Carolina. 24A S.C. Code Ann. Regs. 61-15 § 102(1)© (Supp. 2007) requires a health care facility to obtain a Certificate of Need (CON) before undertaking a capital expenditure on behalf of the facility in excess of $2,000,000, unless the project is exempt under 24A S.C. Code Ann. Regs. 61-15 § 104 (Supp. 2007). Carolinas does not dispute that its proposed office building involves a capital expenditure on behalf of a health care facility in excess of $2,000,000. Rather, Carolinas asserts that the building is exempt from the CON requirements. Accordingly, on October 17, 2007, Carolinas submitted a request to the South Carolina Department of Health and Environmental Control (DHEC or Department) for an exemption from CON requirements for the proposed office building.

DHEC issued a written approval of that request, finding that the expenditures by Carolinas for the construction of the building were for nonmedical projects and therefore exempt from the CON process pursuant to Regulation 61-15 § 104(2)(f). The Department thereafter mailed the written exemption to Carolinas on October 26, 2007, the date of its decision. On November 5, 2007, the Department mailed a “Certificate of Need Update” (CON Update) to all subscribers of the CON Update, including the Petitioner Piedmont, in which the Department provided a list of all CON decisions, non-applicability determinations, and written exemptions issued during October 2007. The November 2007 CON Update specifically contained the Department’s written exemption issued to Carolinas for the construction of its Fort Mill office building. The CON Update shows that the written exemption was issued to Carolinas on October 26, 2007. On December 4, 2007, in response to a phone call received from Piedmont, DHEC faxed a copy of Carolinas exemption decision letter for the Fort Mill medical office building to Piedmont’s Chief Executive Officer, Charles Miller.

Piedmont did not request a review of the staff’s exemption determination by the DHEC Board until December 20, 2007. The Board declined review and, on February 14, 2008, Piedmont filed this contested case action.

DISCUSSION

Subject Matter Jurisdiction

Carolinas contends that the ALC lacks subject matter jurisdiction to hear this case because Petitioner Piedmont Medical Center (Piedmont) failed to timely file its case challenging DHEC’s written exemption issued to Carolinas. Carolinas, however, erroneously characterized the jurisdictional defect as one relating to the Court’s subject matter jurisdiction. “Subject matter jurisdiction of a court depends upon the authority granted to the court by the constitution and laws of the state.” Paschal v. Causey, 309 S.C. 206, 209, 420 S.E.2d 863, 865 (Ct. App. 1992). It refers to the “power to hear and determine cases of the general class to which the proceedings in question belong.” Slezak v. S.C. Dep’t of Corr., 361 S.C. 327, 331, 605 S.E.2d 506, 507 (2004), cert. denied, 544 U.S. 1033 (2005) (quoting Dove v. Gold Kist, Inc., 314 S.C. 235, 238, 442 S.E.2d 598, 600 (1994)). Here, the ALC has jurisdiction to hear contested cases arising from decisions involving the issuance of permits or licenses, or other actions of the Department which may give rise to a contested case pursuant to S.C. Code Ann. § 1-23-600(A) (as amended by 2008 S.C. Act No. 334); S.C. Code Ann. § 44-1-60 (Supp. 2007). Therefore, the ALC has subject matter jurisdiction over this case.

Statutory Deadline

Nevertheless, the crux of Carolinas’ argument is that the ALC lacks jurisdiction to hear this case because Piedmont failed to timely file its case challenging DHEC’s decision. In other words, the ALC does not have jurisdiction over this matter because Piedmont failed to comply with the statutory procedural prerequisites for perfecting contested case review of DHEC’s decision.[2] On the other hand, Piedmont contends it did not receive actual or constructive notice that DHEC granted this exemption to Carolinas until December 5, 2007 – when Piedmont’s Chief Executive Officer, Charles Miller, read the CON Update. Therefore, Carolinas argues that it was not required to file a request for final review by the Department Board until fifteen days after Mr. Miller read the CON Update. Piedmont thus asserts that its request for final review by the Department’s Board was timely since it was filed on December 20, 2007, which was within fifteen days after Mr. Miller read the notice of the Department’s decision.

S.C. Code Ann § 44-1-60(E) provides that:

Notice of the department decision must be sent to the applicant, permittee, licensee, and affected persons who have asked to be notified by certified mail, return receipt requested. The department decision becomes the final agency decision fifteen days after notice of the department decision has been mailed to the applicant, unless a written request for final review is filed with the department by the applicant, permittee, licensee, or affected person.

(emphasis added). S.C. Code Ann. § 44-1-60(E) sets forth a fixed period of time by which an affected person can seek contested case review of a Final Department Determination.[3] “A statute of limitations has been defined as the action of the state in determining that after the lapse of a specified time a claim shall not be enforceable in a judicial proceeding. Thus, any law which creates a condition of the enforcement of a right to be performed within a fixed time may be defined as a statute of limitations.” 51 Am. Jur. 2d Limitation of Actions § 2 (1970). Furthermore,

[t]here has been some difference of opinion among the authorities whether, at least in the absence of an expression of the legislature in this particular respect, the running of a statute of limitations operates to extinguish merely the remedy or to extinguish the substantive right as well as the remedy. The general rule in this respect, supported by the great preponderance of the authorities on the subject, is that a statute of limitations operates on the remedy directly only and does not extinguish the substantive right. Under this rule the courts have regarded true statutes of limitation as doing no more than cut off resort to the courts for enforcement of the substantive claim or right.

51 Am. Jur. 2d Limitation of Actions § 22 (1970). Additionally, “[s]tatutes of limitations are not simply technicalities. On the contrary, they have long been respected as fundamental to a well-ordered judicial system.” City of North Myrtle Beach v. Lewis-Davis, 360 S.C. 225, 231, 599 S.E.2d 462, 465 (Ct. App. 2004). Moreover, this court has no authority to expand the time in which the request for a hearing must be filed. See Mears v. Mears, 287 S.C. 168, 169, 337 S.E.2d. 206, 207 (1985); Sadisco of Greenville, Inc. v. Greenville County Bd. Of Zoning Appeals, 340 S.C. 57, 59, 530 S.E.2d 383, 384 (2000). I find that Section 44-1-60(E) operates as a “statute of limitations.”

However, even though Section 44-1-60(E) sets forth a mandatory time frame in which to seek review of a DHEC staff determination, there remains the issue of whether Piedmont timely filed its request for review with the DHEC Board. The parties do not question that DHEC did not mail Piedmont notice of its October 26, 2007 decision or that Piedmont was unaware that Carolinas was seeking an exemption for the construction of its building. It is also undisputed that Piedmont is an affected party. Therefore, Carolina’s request for an exemption and, more importantly, the Department’s approval of the request were made without any notice to Piedmont – an affected person. Furthermore, since Piedmont was not aware that Carolinas was seeking an exemption regarding this issue, it could not have requested to receive notice.[4]

Carolinas and DHEC nevertheless contend that Section 44-1-60(E) should be read literally and thus Piedmont was required to strictly comply with the statutory deadline of Section 44-1-60 in seeking review of this case before the Board. As noted above, the 15-day period begins to run from the day that the notice is mailed, not when notice is received. In other words, Carolinas/DHEC contends that even though Piedmont never received notice of its decision until after November 5, 2007 (the date of the mailing of the Update), it is required to appeal the matter in accordance to the fifteen day deadline under Section 44-1-60(E) on November 12, 2007. Here, however, the record does not establish when Piedmont received the exemption letter. I therefore cannot, at this stage of the proceedings, presume Piedmont received the CON Update before the date it was required to contest review. Since the Update did not specify the date the decision was mailed, affected parties would be left to speculate as to when the request for review must be filed.[5] Moreover, even assuming that Piedmont received the notice the following day (November 6, 2007), it would have had at most six days to file an appeal. I therefore find that a literal reading of Section 44-1-60(E) would lead to the absurd result that an affected person who was never notified of the Department’s review of a CON matter and who never received notice of the Department’s determination regarding that matter would not have a right to contest the Department’s decision if that person did not file a request for final review 15 days after notice of the department decision was mailed to the applicant. In other words, a strict application of the statute under these circumstances would result in a denial of due process.

Courts have held that:

The essential requirements of due process … are notice and an opportunity to respond. The opportunity to present reasons, either in person or in writing, why proposed action should not be taken is a fundamental due process requirement.

Ross v. Medical Univ. of S.C., 328 S.C. 51, 66, 492 S.E.2d 62, 70 (1997) (quoting Cleveland Board of Education v. Loudermill, 470 U.S. 532, 545-46 (1985)). Furthermore, in Ross, the South Carolina Supreme Court held that S.C. Const. Art. I, § 22 specifically “requires an administrative agency provide notice and an opportunity to be heard.”[6] 328 S.C. at 68, 492 S.E.2d at 71. Therefore, I find that in instances in which the Department makes a determination without any formal review process and with no notice to an “affected person,” due process mandates that an affected person receive reasonable notice of the decision.

The South Carolina Supreme Court also followed a similar approach in Hamm v. S.C. Pub. Serv. Comm’n, 287 S.C. 180, 336 S.E.2d 470 (1985). In Hamm, the Court interpreted the notice provision of the APA codified at S.C. Code Ann. Section 1-23-380(b) (Supp. 1984). At that time, Section 1-23-380(b) provided that:

Proceedings for review are instituted by filing a petition in the circuit court within thirty days after the final decision of the agency or, if a rehearing is requested, within thirty days after the decision thereon. Copies of the petition shall be served upon the agency and all parties of record.

The Court held “[w]hile a literal reading of Section 1-23-380(b) suggests the thirty days to appeal runs from the time the decision is made, we believe the statute must be read to allow a party thirty days after notice of a decision to bring an appeal.” 336 S.E.2d at 471. The Court reasoned that any other interpretation could lead to the absurd result that “an agency could preclude judicial review in all cases simply by concealing its decision until the thirty days had run.” Id.[7]

Here, Section 44-1-60(E) establishes that fifteen days notice is a reasonable time frame for notice in these cases. Therefore, I find that in instances in which the Department makes a determination without any formal review process and with no notice to an “affected person,” the affected person has fifteen days from the date it received actual or constructive notice of the decision. See Ogburn‑Matthews v. Loblolly Partners, 332 S.C. 551, 561, 505 S.E.2d 598, 603 (Ct. App. 1998) (“Due process is flexible and calls for such procedural protections as the particular situation demands.”).[8] Accordingly, Piedmont had fifteen days from the date it received actual or constructive notice of the October 26, 2007 decision of the Department to file its request for review.

Notice of DHEC’s Decision

Carolinas nevertheless contends that even though Piedmont failed to receive specific written notice of DHEC’s decision, Piedmont received actual and constructive notice well before the fifteen-day deadline to file a petition for review under Section 44-1-60(E). In Strother v. Lexington County Recreation Commission, 332 S.C. 54, 504 S.E.2d 117 (1998), the South Carolina Supreme Court reviewed the Court of Appeals’ finding that case law had altered the meaning of actual and constructive/inquiry notice “to the point of equating inquiry notice with actual notice.” The Supreme Court, disagreeing with the Court of Appeals’ interpretation of the case law, clarified that constructive/inquiry and actual notice are distinct concepts. While the Court acknowledged that “[o]ur case law has stated inquiry notice is equivalent to actual notice,” it explained that those assertions were “simply referring to the fact that inquiry notice can have the same effect as actual notice, not that inquiry notice is actual notice.” 504 S.E.2d at 122. The Court then expounded on the difference between actual and constructive notice:

Notice is regarded as actual where the person sought to be charged therewith either knows of the existence of the particular facts in question or is conscious of having the means of knowing it, even though such means may not be employed by him. Generally, actual notice is synonymous with knowledge. Constructive notice is a legal inference which substitutes for actual notice. It is notice imputed to a person whose knowledge of facts is sufficient to put him on inquiry; if these facts were pursued with due diligence, they would lead to other undisclosed facts. Therefore, this person is presumed to have actual knowledge of the undisclosed facts.

504 S.E.2d at 122 n.6 (citations omitted) (emphasis added).

In a concurring and dissenting opinion in Fuller-Ahrens Partnership v. S.C. Department of Highways & Public Transportation, 311 S.C. 177, 427 S.E.2d 920 (Ct.App.1993), Judge Cureton explicated that “[t]he law imputes knowledge when opportunity and interest, coupled with reasonable care, would necessarily impart it.” 427 S.E.2d at 924. Constructive notice thus involves either a legal presumption based upon documents filed in conformity with applicable statutory law or facts that would lead a person of due diligence to make further inquiry. Strother, 504 S.E.2d 117; Berry v. McLeod, 328 S.C. 435, 492 S.E.2d 794 (Ct. App. 1997); see also Spence v. Spence, 368 S.C. 106, 119, 628 S.E.2d 869, 876 (2006) (“[C]onstructive or inquiry notice in the context of a real estate transaction often is grounded in an examination of the public record because it is the proper recording of documents asserting an interest or claim in real property which gives constructive notice to the world.”). Furthermore, “[t]he test of whether a person should have known the operative facts is objective, rather than subjective.” Berry, 492 S.E.2d at 799. It is viewed from the perspective of the action a reasonable person would take under the circumstances. See Staples v. Duell, 329 S.C. 503, 508, 494 S.E.2d 639,642 (Ct. App. 1997) (“Constructive notice is notice that a reasonable person should know and carries a duty of reasonable care.”).

Here, the Department mailed the written exemption to Carolinas on October 26, 2007. Moreover, on November 5, 2007, the Department also mailed a CON Update to all subscribers of the Update. The CON Update listed all CON decisions, all non-applicability determinations, and all written exemptions issued during October of 2007. In regard to DHEC’s grant of an exemption to Carolinas, it specifically identified that “Carolinas Medical Center” was approved for “construction of a medical office building” at “Fort Mill Office Plaza Fort Mill, South Carolina.”

Piedmont’s Chief Executive Officer, Charles Miller, is a subscriber to the CON Update. Piedmont does not dispute that Mr. Miller received that Update shortly after it was mailed or that notice to Mr. Miller is notice to Piedmont. In fact, DHEC received a telephone call between November 5 and November 27, 2007 from Charles Miller or someone from Piedmont calling on his behalf requesting a copy of the Carolinas exemption decision letter for the medical office building in Fort Mill, South Carolina. Because the decision number provided by the caller was incorrect, the staff did not promptly locate the exemption. Piedmont conceded, however, that a copy of the exemption decision letter was ultimately faxed to the proper number in Mr. Miller’s office and that it was received on December 4, 2007.

Piedmont did not file its request for final review until December 20, 2007, which was 55 days after the exemption was approved and mailed to Carolinas. Nevertheless, Piedmont contends that it did not receive actual or constructive notice until December 5, 2007 (when Mr. Miller actually read the CON Update), and that it therefore properly filed its petition for review within the fifteen-day deadline under Section 44-1-60(E).

Actual Notice

Piedmont contends that the information contained within the CON Update did not constitute actual notice because even after reading the Update, Piedmont lacked crucial information regarding Carolinas’ medical office building exemption. Piedmont submitted that it would not have opposed Carolinas’ exemption had Carolinas constructed an office building for solo practitioners, small physician group practices, or solely for the purpose of leasing space to area physicians. Indeed, the CON Update did not specify the services to be offered, the number of physicians to be located, or the specialties to be offered in Carolinas’ medical office building. “If there is any ambiguity in the terms of a notice, rendering its meaning doubtful, the doubt must be resolved against the person giving notice.” 66 C.J.S. Notice § 33 (1998). Moreover, “[t]he burden of proving notice rests with the party asserting its existence.” See 66 C.J.S. Notice § 36 (1998); see also Strother, 504 S.E.2d at 121 n.3. Therefore, construing the ambiguities in the notice against the Respondents, I find that Piedmont did not have actual notice until it received the faxed copy of Carolinas’ exemption from DHEC on December 4, 2007.[9]

Piedmont contends, however, that DHEC’s fax should not be considered notice on December 4, 2007 but rather on December 5, 2007. In other words, Piedmont seeks to limit actual notice not to the date the facsimile was received but to the date it was read. In support of its assertion, Piedmont cites the holding in Strother that “[a]ctual notice is synonymous with knowledge.” It further argues that DHEC’s facsimile could not constitute actual notice until Piedmont either knew of the existence of the facts contained within the facsimile or was conscious of having the means of knowing it. Piedmont argues that none of the secretaries in the office where the facsimile was delivered were authorized to act on behalf of Piedmont in relation to Carolinas’ medical office building exemption; therefore, Piedmont cannot be charged with notice upon receipt by an unauthorized agent. Thus, since there is undisputed evidence that Mr. Miller did not read the facsimile until December 5, 2007, Piedmont asserts that it cannot be charged with actual notice until that day.

In support of its argument, Piedmont cites the holding in Hill v. Carolina Power & Light Co., 204 S.C. 83, 28 S.E.2d 545 (1943) that:

If [notice] relates to a matter over which the agent has no authority, and concerning which he is not authorized to act for his principal, although he may be an agent for other purposes, it will not affect the principal or be binding on him.

28 S.E.2d at 550. Thus, Piedmont contends that it cannot be charged with knowledge of the existence of the facts contained within the facsimile until it was received by an agent that is authorized to act for or on behalf of it with respect to such information. Hill, however, addressed the point at which a third party’s notice to an agent constitutes notice to the principal. That issue, and thus the holding in that case, is not before this Court.[10]

The issue in this case is rather whether receipt of notice by facsimile to the proper number in Mr. Miller’s office constitutes actual notice upon delivery. Piedmont concedes that a facsimile can constitute actual notice and that it was sent to the proper facsimile number. Even if the facsimile was physically received by Mr. Miller’s secretaries, it was sent to Mr. Miller. Furthermore, there is no contention that the secretaries were not authorized to take delivery of the facsimile when it arrived in the machine on his behalf. Therefore, the undisputed evidence reflects that the facsimile was properly received.

The remaining issue is whether the receipt of the facsimile imputes knowledge of the contents of the document upon the date of receipt. As set forth above, a party may be charged with receipt of actual notice where the person “is conscious of having the means of knowing it, even though such means may not be employed by him.” Strother, 504 S.E.2d at 122 n.6. “Knowledge or actual knowledge may constitute actual notice, but actual notice does not necessarily mean knowledge or actual knowledge, and it is not limited to knowledge or ‘actual knowledge.’” 66 C.J.S. Notice § 4 (1998). Actual knowledge may be inferred from factual circumstances. Strother, 504 S.E.2d at 123. Furthermore, where a statute or rule states that notice should be given without stating how it should be given, if mailing is not the effective date of receipt, the effective date of notice is the date it is received. 58 Am. Jur. Notice § 33 (2002).

Here, the exemption decision at issue in this case was attached by the Department to the fax coversheet. The facsimile thus clearly provided sufficient information to place Piedmont on notice of the nature of the exemption received by Carolinas. Therefore, I find that Piedmont had actual notice of the contents of the facsimile upon the date it was received at the correct facsimile machine in Mr. Miller’s office, that is, December 4, 2007. Moreover, under Piedmont’s position, individuals or corporations could avoid notice by simply refusing to open their mail or contending that they never read it. The results emanating from that reasoning could create profound problems in the application of the notice laws and, in particular, the process of reviewing regulatory decisions in this State. Accordingly, I find that, based on an analysis of actual notice, Piedmont was required to file its request for review no later than December 19, 2007.

Constructive Notice

Piedmont argues that it would be unreasonable to find that it had constructive notice of the exemption simply because it received the CON Update. As noted above, Piedmont does not dispute that it received the CON Update shortly after it was mailed on November 5, 2007. Piedmont nevertheless argues that once it was placed “on inquiry” by facts, it should be allowed a reasonable time in which to make inquiry before being affected with notice. To that end, Piedmont again asserts that constructive notice occurred only after Mr. Miller read the CON Update. According to Piedmont, the nature of Mr. Miller’s position does not give him the luxury to read every publication in detail immediately as each is received. Thus, Piedmont contends that Mr. Miller was not put on notice of any facts that would lead him to review the CON Update in any particular detail or search out any other information about a possible exemption issued to Carolinas until Mr. Miller received a newspaper article on December 19, 2007 that reported that Carolinas could open an urgent care center without applying for additional DHEC review.

I find that the CON Update provided Piedmont with sufficient information to put Piedmont “on inquiry” as to the scope of the exemption granted. In other words, Piedmont certainly had the opportunity and interest to inquire further upon receipt of the declaration made in the CON Update that DHEC had granted an exemption to Carolinas for the medical office building. Moreover, the existence of “inquiry notice” is undisputedly shown by Mr. Miller’s (or at least his staff’s) inquiry to DHEC requesting a copy of Carolinas’ exemption decision letter for the medical office building in Fort Mill. That inquiry occurred between November 5 and November 27, 2007. Piedmont’s argument that it did not have sufficient information to be placed under a duty to inquire is thus dispelled by the fact that it requested a copy of Carolinas’ exemption letter in November, 2007.

Moreover, as explained earlier, the time frame to respond is not some indefinite period, but is controlled by Section 44-1-60(E). That statute operates as a “statute of limitations.” Furthermore, constructive notice is “a legal inference which substitutes for actual notice.” Strother, 504 S.E.2d at 122 n.6. Once a person is sufficiently put on inquiry, they are presumed to have actual knowledge of the undisclosed facts. Id. The statute of limitation thus begins to run under the doctrine of constructive notice from the time an individual has inquiry/constructive notice that “some claim against another party might exist.” Mitchell v. Holler, 311 S.C. 406, 409, 429 S.E.2d 793, 795 (1993) (quoting Snell v. Columbia Gun Exch., Inc., 276 S.C. 301, 303, 278 S.E.2d 333, 334 (1981)); see also Berry v. McLeod, 328 S.C. 435, 445, 492 S.E.2d 794, 800 (Ct. App. 1997) (“The statute of limitations begins to run at the time the individual has inquiry or constructive notice.”). Therefore, viewed in the light most favorable to Piedmont, the time frame for it to file a request for final review began on November 27, 2007. Thus, based on an analysis of constructive notice, Piedmont was required to file its request for final review no later than December 12, 2007.[11]

Finally, Piedmont argued that it is unreasonable to impute notice to it simply because it is a subscriber to the CON Update. Piedmont contends that since the Update is not required by statute or regulation to be published or even acknowledged by statute or regulation to be a valid form of notice, it cannot constitute constructive notice. To the contrary, Carolinas points out that CON applications are formally reviewed and notice is mailed to all affected persons who request to receive notice. However, exemptions, on the other hand, are not formally reviewed by the Department, and thus affected persons do not receive a copy of the decision when mailed to the applicant. Carolinas therefore contends that since there is no formal review process regarding CON exemptions, there exists a duty by all potentially affected persons to inquire about exemptions via receipt of the CON Update. Carolinas thus contends that based on the duty to inquire, Piedmont had constructive notice of the decision on the date the decision was mailed to Carolinas or the date when the CON Update was mailed.

“No set rule can very well be established to determine what constitutes a sufficiency of facts to excite inquiry, and each case depends on its own facts and circumstances.” 66 C.J.S. Notice § 14 (1998). Therefore, simply because the CON Update is not required by statute or regulation to be published does not make the notice any less valid. Nevertheless, the fact that the Update is not approved by statute or regulation to be a valid form of notice precludes it from operating as imputed notice to all affected persons.

Therefore,

IT IS HEREBY ORDERED that this case is DISMISSED.

AND IT IS SO ORDERED.

______________________________

Ralph K. Anderson, III

Administrative Law Judge

October 3, 2008

Columbia, South Carolina



[1] In reaching a determination in this case, the Court considered the affidavits submitted by the parties regarding this Motion. Carolinas framed its Motion to Dismiss based upon an assertion that the Court lacked subject matter jurisdiction. Though I find that the ALC has subject matter jurisdiction to hear this case, I have nevertheless considered whether the ALC has procedural jurisdiction based upon the timeliness of Piedmont’s request for review. In Posey v. Proper Mold & Engineering, Inc., 378 S.C. 210, 217, 661 S.E.2d 395, 399 (Ct. App. 2008), the Court held that “[t[he court may consider affidavits on a question of law in a jurisdictional motion without converting the motion into one for summary judgment.” Presumably, this holding equally applies to consideration of procedural jurisdiction as well as subject matter jurisdiction. Nevertheless, all the parties were given ample opportunity to introduce evidentiary matters. See Johnson v. Dailey, 318 S.C. 318, 457 S.E.2d 613 (1995).

However, Piedmont submitted an affidavit dated September 17, 2008 by David S. Levitt after the record was closed regarding this matter. That affidavit was not considered. Moreover, even if Levitt’s affidavit had been considered it would not have changed the result.

[2] In Bowles v. Russell, 127 S.Ct. 2360 (2007), the U.S. Supreme Court explained, in the context of federal courts, the nature of the “jurisdictional” question at issue in cases such as this one:

Within constitutional bounds, Congress decides what cases the federal courts have jurisdiction to consider. Because Congress decides whether federal courts can hear cases at all, it can also determine when, and under what conditions, federal courts can hear them. Put another way, the notion of “subject-matter” jurisdiction obviously extends to “classes of cases . . . Falling within a court’s adjudicatory authority,” but it is no less “jurisdictional” when Congress forbids federal courts from adjudicating an otherwise legitimate “class of cases” after a certain period has elapsed from final judgment.

Id. at 2365-66 (internal citations omitted).

[3] Section 44‑1‑60(E) was passed by the Legislature in 2006 as part of the restructuring of the procedure for appeals of decisions made by DHEC and other administrative agencies. It was intended to provide a uniform procedure for contested cases and appeals from administrative agencies.

[4] See S.C. Coastal Conservation League, Petitioners v. S.C. Dep’t of Health and Envtl. Control and S.C. State Ports Auth., 2007 WL 2782818, 07-ALJ-07-0107-CC (2007) (holding that since an affected person has the statutory right to request to be notified of a DHEC decision by certified mail, return receipt requested pursuant to Section 44-1-60(E), the person has a duty to request that notice if it desires to acquire any entitlement to notice to contest a staff decision.

[5] Piedmont conceded it received the CON Update “shortly” after it was mailed. That term nevertheless does not establish the date of delivery with sufficient certainty that it was received before November 12, 2007.

[6] To prove the denial of due process, a party must also show that it has been substantially prejudiced by the administrative process. Palmetto Alliance, Inc. v. S. C. Public Service Comm’n., 282 S.C. 430, 319 S.E.2d 695 (1984). Here, Piedmont would be completely foreclosed from review of this matter. That preclusion certainly would create substantial prejudice.

[7] In MRI at Belfair, LLC v. S.C. Dep’t of Health and Envtl. Control, 2006 WL 3232043, 06-ALJ-07-0714-CC (2006), I further found that where a person participated in the review process, a request for final review must be received by the Department fifteen days after the applicant, permittee, licensee, or affected person receives notice. That finding was dicta. Moreover, upon further review such a broad view of the application of the requirement that the time to file a petition for review runs from the date of receipt rather than the date of mailing is questionable. See S.C. Coastal Conservation League v. S.C. Dep’t of Health and Envtl. Control, 07-ALJ-07-0107-CC, 2007 WL 2782818 (2007) (concluding that Section 44-1-60(E) requires the fifteen-day period to run from the mailing of the notice, not the receipt of the notice).

[8] The foregoing notwithstanding, in permitting cases, there needs to be some point in which an applicant for a permit can presume that the permitting process has concluded. See Botany Bay Marina, Inc. v. Townsend, 296 S.C. 330, 335 n.3, 372 S.E.2d 584, 586 n.3 (1988), overruled in part on other grounds by Woodard v. Westvaco Corp., 460 S.E.2d 392, 319 S.C. 240 (1995) (noting the importance of “finality in administrative decision-making”). This problem is addressed by ALC Rule 11©, which provides that “no request [for a contested case hearing] shall be filed more than ninety (90) days after the date of the issuance of the order or determination unless the administrative law judge assigned to the case finds that substantial cause exists for allowing the filing beyond the ninety (90) day period.” The applicability of ALC Rule 11©, however, is not before me in this instance.

[9] In making that decision, I do not conclude that a CON Update cannot constitute actual notice. The decision is rather limited to the fact that the CON Update in this case failed to provide sufficient information to give actual notice of the details of its decision.

[10] Moreover, it is worth noting that, under South Carolina’s civil and appellate court rules, service by delivery is considered complete when the document is left at the party’s office “with his clerk or other person in charge thereof.” See Rule 5(b)(1), SCRCP; Rule 233(b), SCACR. The American College Heritage Dictionary defines “clerk” to mean, inter alia, “[a] person who works in an office handling such things as records, correspondence, or files.” American College Heritage Dictionary 261 (3rd ed. 1993). Thus, the aforementioned court rules do not appear to require that service by delivery be made on a person authorized to act on the party’s behalf with respect to the matter set forth in the document served.

[11] At the hearing, Piedmont argued that it did not know for certain that a claim existed against Carolinas until it received a copy of Carolinas’ exemption letter. However, as noted above, the statute of limitation begins to run under the doctrine of constructive notice as soon as an individual has notice that “some claim against another party might exist,” not when a “full-blown theory of recovery” is developed. Mitchell, 311 S.C. at 409, 429 S.E.2d at 795 (quoting Snell, 276 S.C. at 303, 278 S.E.2d at 334). At the time Piedmont received the CON Update, it was put on notice that a claim against Carolinas might exist and that the statutory time frame for bringing that claim had begun to run.


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