ORDERS:
ORDER
STATEMENT OF THE CASE
Pursuant to S.C. Code Ann. §§ 40-15-200 (2001) & 1-23-380(B)
(Supp. 2000), Appellant Hoyt Eagerton, Jr., appeals the Order of the South
Carolina Board of Dentistry (Board) dated February 26, 2001. In that Order,
the Board found that employees of Appellant's dental practice were unable
to locate a dental record subpoenaed by the Board in August 1999 and that,
therefore, Appellant had violated S.C. Code Ann. Regs. 39-11(1-B) (1976),
which requires a dentist to maintain patient records "in a manner consistent
with the protection of the welfare of the patient." Finding this violation,
the Board suspended Appellant's license to practice dentistry for one year.
The Board further ordered that this suspension would be stayed and Appellant's
license reinstated on a probationary status on the condition that the Appellant:
(1) pay a $3,000 fine;
(2) complete a fourteen-hour course in record keeping;
(3) comply with all state and federal statutes and regulations governing
the practice of dentistry;
(4) make his patient records and dental offices open to reasonable periodic
inspections by the Board; and
(5) keep the Board apprised of any changes in his address, practice,
professional status, or compliance with the Board's Order.
Appellant contends that the Board's Order should be overturned because
it is (1) affected by errors of law, (2) clearly erroneous in view of the
substantial evidence in the record, and (3) arbitrary and capricious in
nature. Upon careful consideration of the record, the briefs filed, the
applicable law, and counsel's oral arguments, the case is affirmed in part,
reversed in part, and remanded to the Board.
BACKGROUND
Appellant is a dentist duly licensed to practice dentistry in South
Carolina. He owns and operates the Sexton Dental Clinic, which consists
of a main office in Florence, South Carolina, and a second, smaller office
in Myrtle Beach, South Carolina. As owner and manager of those clinics,
Appellant sets the policies and procedures for the maintenance of patient
records used at those offices.
On June 4, 1999, employees of the Myrtle Beach office of the Sexton
Dental Clinic treated and extracted a tooth from patient Frank W. McLaughlin.
In response to an allegation of malpractice, the Board issued a subpoena
on August 12, 1999, to the Sexton Dental Clinic for the medical records
of Mr. McLaughlin. Board investigators delivered the subpoena to the Myrtle
Beach clinic on that same day. The employees of the Sexton Dental Clinic
were, however, unable to locate the patient records of Mr. McLaughlin at
that time or at any time subsequent to the service of the Board's subpoena.
Following the clinic's failure to produce McLauglin's records, the Board
issued a formal accusation which stated that because "the [subpoenaed]
patient record was not available . . . . [Appellant] has failed to maintain
dental records in a manner consistent with the protection of the patient."
(Formal Accusation ¶ 3.) A hearing was held before the Board on February
9, 2001, and the Board's decision finding Appellant to have violated Regulation
39-11 (1-B) was issued on February 26, 2001. This appeal follows.
STANDARD OF REVIEW
The
provisions of the South Carolina Administrative Procedures Act (APA) govern
an appeal from an action of the Board. S.C. Code Ann. § 1-23-380(B)
(Supp. 2000). Under the APA, this tribunal "shall not substitute its judgment
for that of the agency as to the weight of the evidence on questions of
fact." S.C. Code Ann. § 1-23-380(A)(6) (Supp. 2000). This tribunal,
however, may reverse or modify a decision if substantial rights of an appellant
have been prejudiced because the administrative findings or decisions are
"affected by . . . error of law," "clearly erroneous in view of the reliable,
probative and substantial evidence on the whole record," or "arbitrary
or capricious." Id; see
alsoLark v. Bi-Lo, Inc.,
276 S.C. 130, 276 S.E.2d 304 (1981).
This tribunal has the authority
to review agency rulings on issues of law, and may substitute its judgement
for that of the agency when necessary. 2 Am. Jur. 2d Administrative
Law § 523 (1994). These purely legal issues are fit for review
if they will not be clarified by further factual development and include
an agency's construction of statutes and constitutions and its interpretation
of its own regulations. Id.
But, in conducting such review, the construction of a statute by the agency
charged with its administration will be accorded the most respectful consideration
and will not be overturned absent compelling reasons. Dunton
v. S.C. Bd. of Exam'rs in Optometry, 291 S.C. 221, 353 S.E.2d 132
(1987). Nonetheless, the
final responsibility for the interpretation of the law rests with the courts, Stone
Mfg. Co. v. S.C. Employment Sec. Comm'n, 219 S.C. 239, 64 S.E.2d
644 (1951), and an
agency's mistaken interpretation of a statute or regulation will constitute
reversible error of law. See,
e.g.,Adkins v. Comcar Indus.,
Inc., 316 S.C. 149, 447 S.E.2d 228 (Ct. App. 1994).
A more deferential standard
of review is applied to this tribunal's review of agency findings that
are not pure matters of law. Such findings will not be disturbed unless
clearly erroneous in light of the substantial evidence in the record. S.C.
Code
Ann. § 1-23-380(A)(6)(e). Substantial evidence is that evidence which,
in considering the record as a whole, would allow reasonable minds to reach
the conclusion of the administrative agency. E.g., Jennings
v. Chambers Dev. Co., 335 S.C. 249, 516 S.E.2d 453
(Ct. App. 1999). The possibility of drawing two inconsistent conclusions
from the evidence does not prevent an administrative agency's finding from
being supported by substantial evidence. Id.
Where there is a conflict in the evidence, the administrative agency's
findings of fact are conclusive. Id.
This tribunal cannot substitute its judgment for that of the Board upon
a question as to which there is room for a difference of intelligent opinion. E.g.,Chem.
Leamen Tank Lines v. S.C. Pub. Serv. Comm'n, 258 S.C. 518, 189 S.E.2d
296 (1972). However,
while a decision of an administrative agency will normally be upheld, the
findings may "not be based upon surmise, conjecture, or speculation, but
must be founded on evidence of sufficient substance to afford a reasonable
basis for it." Mullinax
v. Winn-Dixie Stores, Inc., 318 S.C. 431, 443, 458 S.E.2d 76, 83
(Ct. App. 1995).
Finally,
this tribunal may reverse an agency's final decision as arbitrary and capricious
only if the decision is without a rational basis, is based alone on one's
will and not upon any course of reasoning and exercise of judgment, is
made at pleasure, without adequate determining principles, or is governed
by no fixed rules or standards. Deese
v. S.C. Bd. of Dentistry, 286 S.C. 182, 332 S.E.2d 539 (Ct. App.
1985). Thus, so long as the actions taken by an agency are within the guidelines
established by law, this tribunal cannot characterize those actions as
arbitrary and capricious under the law. Id.
The
burden is on the Appellant to show convincingly that the Board's Order
is affected by an error of law, without evidentiary support, or arbitrary
or capricious as a matter of law. SeeHamm
v. Am. Telephone & Telegraph Co., 315 S.C. 119, 432 S.E.2d 454
(1993); Hamm
v. Pub. Serv. Comm'n of S.C., 310 S.C. 13, 425 S.E.2d 28 (1992).
ISSUES
ON APPEAL
I. Did the Board err, as a matter of law,
in finding a violation of S.C. Code Ann. Regs. 39- 11 (1-B) (1976) to lie
on the sole ground that a patient record cannot be produced by a dentist's
office, without any showing of fault or misconduct on the part of the dentist
or his office?
II. Was the Board's decision finding Appellant
guilty of a violation of Regulation 39-11 (1-B) and suspending his dental
license clearly erroneous in view of the reliable, probative, and substantial
evidence on the whole record?
III. Was the Board's decision arbitrary
and capricious?
ANALYSIS
I.
Did the Board err, as a matter of law, in its construction of Regulation
39-11 (1-B)?
The Board did not commit reversible error
in its construction of Regulation 39-11 (1-B). Regulation 39-11 (1-B) is
a part of the regulatory scheme governing the practice of dentistry in
this state. This regulation provides that:
Dentists are obliged to safeguard the
confidentiality of patient records. Dentists shall maintain patient records
in a manner consistent with the protection of the welfare of the patient.
Upon request of a patient or another dental practitioner, dentists shall
provide any information that will be beneficial for the future treatment
of that patient.
S.C. Code Ann. Regs. 39-11 (1-B) (1976).
S.C. Code Ann. § 40-15-190(A)(9) (2001) defines a dentist's violation
of Regulation 39-11 as misconduct that constitutes grounds for sanction
of the dentist by the Board, and S.C. Code Ann. § 40-15-200 (2001)
prescribes the types of disciplinary action the Board may take in response
to a finding of dentist misconduct under Section 40-15-190. The Board construes
Regulation 39-11 (1-B) to require absolute compliance by the dentist: i.e.,
to the Board, the failure to maintain patient records as provided in the
regulation constitutes a violation of that regulation, regardless of whether
that failure was occasioned by a dentist's negligence or intentional wrongdoing.
Accordingly, in both its Formal Accusation and its Final Order, the Board
alleged that Appellant violated Regulation 39-11 (1-B) by his mere failure
to produce the subpoenaed record. Appellant contends that this construction
of Regulation 39-11 (1-B) is an error of law.
Appellant argues that statutes and regulations
that provide for the revocation of medical licenses, such as Regulation
39-11 (1-B) and its related statutes, are penal in nature, and must, therefore,
be strictly construed in favor of the licensee. Appellant claims that such
a strict construction of Regulation 39-11 (1-B) would imply the application
of a reasonableness standard to that regulation: i.e., the loss of a patient
record would not constitute a violation of Regulation 39-11 (1-B) unless
that loss were shown to be caused by some negligence or misconduct on the
part of the dentist. As the Board in this case has made no allegation or
finding of negligence or misconduct by Appellant, Appellant contends that
he cannot be found in violation of the regulation as properly construed.
This argument must fail for at least two
reasons. First, while South Carolina courts have not squarely addressed
the issue, it does not appear that statutes authorizing the suspension
or revocation of medical licenses, and proceedings under those statutes,
are considered penal under South Carolina law. There is no national consensus
as to whether or not statutes providing for the suspension or revocation
of a medical license are penal in nature. See
70 C.J.S. Physicians
and Surgeons § 35 (1987); see
also, e.g.,Boring
v. Miss. State Bd. of Dental Exam'rs, 300 So. 2d 135 (Miss. 1974)
(holding that a statute providing for the revocation of a dental license
is penal); Armstrong
v. N.C. State Bd. of Dental Exam'rs, 499 S.E.2d 462 (N.C. Ct. App.
1998) (finding that a statute authorizing the revocation of dental licenses
for misconduct is non-penal and therefore does not contain a mens
rea requirement for violations). Despite this lack of controlling
precedent and a clear trend among persuasive authorities, there is dictum
from the South Carolina Supreme Court that suggests that South Carolina
views the revocation of a medical license as a non-penal proceeding. In Wilson
v. State Board of Medical Examiners, 305 S.C. 194, 406 S.E.2d 345,
the Supreme Court adopted the language of a Massachusetts court in noting
that "[t]he revocation of a physician's license, however, is designed not
to punish the physician . . . but to protect the life, health and
welfare of the people at large." Id.
at 196, 406 S.E.2d at 346 (alteration in original) (emphasis added). See
alsoHuber
v. S.C. State Bd. of Physical Therapy Exam'rs, 316 S.C. 24, 446
S.E.2d 433 (1994) (citing to Wilson
in a footnote). The Court's clear refusal to characterize the revocation
of a physician's license as a punitive measure suggests that it would not
consider statutes authorizing the suspension or revocation of medical licenses,
including licenses to practice dentistry, to be penal statutes requiring
strict construction. It seems, then, that under South Carolina law, Regulation
39-11 (1-B) and its related statutes are not penal in nature and do not
require strict construction by the courts.
Second, not only is there no reason to
interpret Regulation 39-11 (1-B) in favor of Appellant, but also there
is sound legal precedent requiring this tribunal to defer to the Board's
construction of the regulation. As noted above, this tribunal must afford
the Board's construction of Regulation 39-11 (1-B) the most respectful
consideration and cannot overrule the Board's construction absent cogent,
compelling reasons. Dunton
v. S.C. Bd. of Exam'rs in Optometry, 291 S.C. 221, 353 S.E.2d 132
(1987); Stone
Mfg. Co. v. S.C. Employment Sec. Comm'n, 219 S.C. 239, 64 S.E.2d
644 (1951). Appellant is correct in noting that requiring strict compliance
with Regulation 39-11 (1-B) can lead to somewhat harsh results: e.g., the
Board could sanction a dentist for a lost patient record despite a lack
of any negligence or misconduct on the part of the dentist or his staff.
The Board, however, is equally correct when it points out the public policy
ramifications of requiring the Board to affirmatively prove negligence
every time a patient record is lost by a dentist: e.g., it would be too
easy for a dentist accused of malpractice to simply discard an incriminating
record without leaving behind any evidence of negligent or fraudulent record
keeping. The Board presumably weighed the competing interests of licensed
dentists and the public when it construed Regulation 39-11 (1-B) to require
strict compliance, and this tribunal will not re-weigh those interests
and reach a different construction of the regulation absent a compelling
reason to do so. The Board's construction of Regulation 39-11 (1-B) does
not conflict with the plain language of the regulation and is clearly aimed
at protecting the health and welfare of the public. Thus, while Appellant
has raised valid concerns regarding the imposition of absolute compliance
with Regulation 39-11 (1-B), he has not presented this tribunal will any
compelling reasons to reject the Board's interpretation of that regulation.
In sum, the Board did not err when it
construed Regulation 39-11 (1-B) to require strict compliance with its
terms, as no principles of statutory construction or cogent, compelling
reasons that would require a different construction of the regulation have
been produced.
II.
Was the Board's decision clearly erroneous in light of the substantial
evidence in the record?
The Board's finding that Appellant committed
a minor violation of Regulation 39-11 (1-B) is supported by substantial
evidence. However, the Board's conclusion that, in order to protect the
public, Appellant's license must be suspended or, in lieu of suspension,
Appellant must be required to pay a $3,000 fine and take a record keeping
course is not supported by substantial evidence on the whole record.
Substantial evidence is "not a mere scintilla
of evidence nor the evidence viewed blindly from one side of the case,
but is evidence which, considering the record as a whole, would allow reasonable
minds to reach the conclusion that the administrative agency reached." Lark
v. Bi-Lo, Inc., 276 S.C. 130, 135, 276 S.E.2d 304, 306 (1981). But,
while an agency's finding will normally be upheld, "such a finding may
not be based upon surmise, conjecture, or speculation, but must be founded
on evidence of sufficient substance to afford a reasonable basis for it." Mullinax
v. Winn-Dixie Stores, Inc., 318 S.C. 431, 443, 458 S.E.2d 76, 83
(Ct. App. 1995). See
alsoTiller
v. Nat'l Health Care Ctr. of Sumter, 334 S.C. 333, 513 S.E.2d 843
(1999) (holding that worker's compensation awards are not supported by
substantial evidence if based on surmise, conjecture, or speculation).
The Board's conclusion that Appellant
violated S.C Code Ann. Regs. 39-11(1-B) (1976) is supported by substantial
evidence. As detailed above, the Board was justified in interpreting Regulation
39-11(1-B) to require absolute compliance with its record keeping provisions.
Consequently, the Board need not find any negligence or intentional wrongdoing
on the part of Appellant or his staff to find a violation of the regulation;
rather, all the Board need find is that a patient record that the Appellant
is required to maintain cannot be produced, for whatever reason. Here,
Appellant concedes that the subpoenaed patient record cannot be found.
Therefore, there is substantial evidence in the record to support the Board's
determination that Appellant violated Regulation 39-11 (1-B).
There is no substantial evidence, however,
to support the Board's determination that the sanctions it imposed on Appellant
are necessary for the protection of the welfare of the public. While the
particular facts surrounding the loss of a patient record are essentially
irrelevant to the Board in determining whether a technical violation of
Regulation 39-11 (1-B) has occurred, those facts are relevant in determining
what sanctions the Board should impose in order to protect society from
"professional ineptitude and misconduct." (Final Order, Conclusion of Law
# 3.) The sanctions imposed on Appellant by the Board must be "designed
not to the punish [Appellant], but to protect the life, health and welfare
of the people at large." Wilson,
305 S.C. at 196, 406 S.E.2d at 346. In making this determination,
the Board "must, therefore, meticulously weigh the public interest and
the need for the continued services of qualified medical professionals
against the countervailing concern that society be protected from professional
ineptitude." Huber,
316 S.C. at 28 n.2, 446 S.E.2d at 435 n.2. (1)Thus,
the Board must consider how the patient record in question was lost in
order to determine what sanction is appropriate to protect the public.
It is not clear that the Board undertook
such an analysis of the facts concerning the loss of the record before
imposing its sanctions on Appellant. In the case at hand, the Board made
no finding that Appellant or his staff was negligent regarding the loss
of the record in question or regarding patient record keeping in general.
The Board made no finding that Appellant or his staff intentionally discarded
the record in question. The Board made no finding that the actions of Appellant
or his staff caused the record in question to be lost. As noted by the
Board's counsel at the disciplinary hearing, "we don't really have any
information on the record" (R. at 7) as to what happened to the patient
record after it was brought to the front desk of Appellant's clinic. Accordingly,
throughout these proceedings, the sole ground asserted by the Board for
discipline of Appellant is that the subpoenaed patient record could not
be located (Formal Accusation ¶ 3; R. at 26 (testimony of Board investigator);
Final Order, Finding of Fact # 2), not that Appellant was guilty of any
negligence or had in any way caused the loss of the record.
While this one finding may support the
conclusion that Appellant is guilty of a minor violation of Regulation
39-11 (1-B), it does not support the sanctions imposed on Appellant by
the Board. For the Board to sanction Appellant in order to protect the
public, it need not necessarily find that Appellant was negligent or guilty
of intentional wrongdoing in losing the record; but, it must at least muster
some facts to support its conclusion that the particular sanction imposed
is a sanction designed to protect the life, health, and welfare of the
people at large. In this case, no substantial evidence in the record indicates
that the patient record was lost because of flaws in Appellant's record
keeping, and thus, no substantial evidence supports the Board's decision
requiring Appellant to attend record keeping classes and to allow periodic
inspections of his records. (2) Similarly,
as no substantial evidence in the record suggests that Appellant was negligent
in the loss of the patient record or that Appellant intentionally discarded
the record, no substantial evidence supports the Board's decision to fine
Appellant nearly 1/3 of the maximum penalty allowed by statute. In short,
there is no evidence in the record as to how the patient record in question
was lost. Therefore, it was simply surmise, conjecture, or speculation
on the part of the Board for it to conclude that the "protect[ion] of the
life, health, and welfare of the people at large" (Final Order, Conclusion
of Law # 4) required Appellant, in lieu of a year's suspension of his license,
to pay a $3,000 fine, to complete fourteen hours of record keeping courses,
and to submit to periodic inspections of his records by the Board. The
Board's conclusion that the sanctions imposed in this case are required
to protect society from professional ineptitude and to protect the life,
health, and welfare of the people at large is not supported by substantial
evidence on the whole record and must be reversed.
III.
Was the Board's decision arbitrary and capricious?
Because the Board's determination
that the sanctions it imposed on Appellant are necessary to protect the
public is not supported by substantial evidence, that determination must
also be characterized as arbitrary and capricious. A decision is arbitrary
if it is without a rational basis. Deese
v. S.C. State Bd. of Dentistry, 286 S.C. 182, 332 S.E.2d 539 (Ct.
App. 1985). Further, an abuse of discretion-a term often used synonymously
with arbitrariness-occurs when a ruling has no evidentiary support or is
affected by an error of law. Allen
v. S.C. Alcoholic Beverage Comm'n, 321 S.C. 188, 467 S.E.2d 450
(Ct. App. 1996). Here, the Board's conclusion that the protection of the
life, health, and welfare of the public necessitates that Appellant pay
a $3,000 fine and attend record keeping classes was not supported by the
evidence in the record. This finding is, therefore, arbitrary and capricious
and constitutes an abuse of discretion on the part of the Board. As such,
it must be reversed.
CONCLUSION
The Board's construction
of Regulation 39-11 (1-B) is not affected by error of law and its finding
that Appellant is guilty of a minor violation of Regulation 39-11 (1-B)
is supported by substantial evidence in the record; both are therefore
affirmed. The Board's finding that the sanctions it imposed on Appellant
are necessary for the protection of the public is not supported by substantial
evidence in the record, is arbitrary and capricious, and is accordingly
reversed. The case is remanded to the Board to reconsider the sanctions
imposed in light of the factual circumstances surrounding the loss of the
patient record to determine what sanctions are necessary to protect the
public. See 2 Am.
Jur. 2d Administrative Law
§ 630 (1994) ("A court will remand a case to the administrative agency
where the court determines that the evidence on which the agency expressly
relied in making its determination is not substantial.").
ORDER
IT IS THEREFORE ORDERED
that this case is REMANDED to the Board of Dentistry to reconsider
the sanctions imposed on Appellant in accordance with this Order.
(3)
AND IT IS SO ORDERED.
______________________________
JOHN D. GEATHERS
Administrative Law Judge
Post Office Box 11667
Columbia, South Carolina 29211-1667
October 19, 2001
Columbia, South Carolina
1. It should be noted that when sitting in its appellate
capacity, this tribunal may not second-guess the results of the Board's
weighing of these interests. See
S.C. Code Ann. § 1-23-380(A)(6). But, this tribunal is entitled to
determine whether or not the Board has complied with the law and at least
engaged in the required "meticulous weighing" of the public's need for
medical services against the desire to protect the public from professional
ineptitude. Id.
2. While some questions regarding Appellant's record
keeping practices were raised in the record below, see,
e.g., R. at 68-70, the Board made no finding that Appellant's record
keeping methods were deficient or that those methods violated Regulation
39-11 (1-B); and this tribunal is not empowered to re-weigh the evidence
considered by the Board to reach a different conclusion. See,
e.g.,Rodney
v. Michelin Tire Corp., 320 S.C. 515, 519, 466 S.E.2d 357, 359 (1996)
(noting that a court "may not substitute its judgment for that of an agency
as to the weight of evidence on questions of fact"). If this tribunal were
to delve into the record on appeal to make findings not made by the Board,
it would engage in a sort of fact-finding that would not only violate the
deferential appellate standard of review set up in the APA, see
S.C. Code Ann. § 1-23-380(A)(6), but also put this tribunal in a position
ill-suited to its role as a reviewing court in this matter. SeePorter
v. S.C. Pub. Serv. Comm'n, 333 S.C. 12, 22 n.3, 507 S.E.2d 328,
333 n.3 (1998) (holding that a reviewing court will not sua
sponte "search the record for substantial evidence supporting a
decision when an administrative agency's order inadequately sets forth
the agency's findings of fact and reasoning").
3. SeeParker
v. S.C. Pub. Serv. Comm'n, 288 S.C. 304, 342 S.E.2d 403 (1986); Piedmont
Natural Gas Co., Inc., 301 S.C. 50, 389 S.E.2d 655 (1990) (stating
that an administrative agency may not consider additional evidence upon
remand unless the court allows it because it would afford a party two bites
at the apple). |