STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

VILLAGE PROPERTIES, INC., and ) FLORIDA HEALTH FACILITIES CORP. )

(of Indian River County), )

)

Petitioners, )

)

vs. ) CASE NO. 88-3553

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of administrative Hearings, by its duly designated Hearing Officer, William J. Kendrick, held a formal hearing in the above styled case on August 31, 1988, in Tallahassee, Florida.

APPEARANCES

For Petitioners: Robert D. Newell, Jr., Esquire

NEWELL & STALH, P.A.

817 North Gadsden Street Tallahassee, Florida 32303-6313

For Respondent: Theodore E. Mack, Esquire

Assistant General Counsel Department of Health and

Rehabilitative Services Fort Knox Executive Center 2727 Mahan Drive, Suite 309

Tallahassee, Florida 32301 PRELIMINARY STATEMENT

At issue in this proceeding is whether respondent properly refused to accept petitioners' application for a certificate of need because it failed to include documentation that the notice of filing had been published in the applicable subdistrict. At hearing, petitioners' exhibit 1, the deposition of Jerry W. Voyna, was received into evidence. Respondent offered the testimony of Sharon Gordon-Girvin, and its exhibit 1 was received into evidence.

The transcript of hearing was filed September 19, 1988, and the parties were granted leave until September 29, 1988, to file proposed findings of fact. The parties' proposed findings have been addressed in the appendix to this recommended order.

FINDINGS OF FACT

Background

1. On May 2, 1988, petitioners timely filed their letter of intent with the local health council and respondent, as required by Section 381.709(2), Florida Statutes, announcing their intent to apply for a certificate of need to add 47 community nursing home beds to their existing facility in Vero Beach, Indian River County, Florida.

   
   

2. Thereafter, petitioners complied with the requirements of Section 381.709(2)(d) Florida Statutes, by publishing a notice in the form required by law in a newspaper of general circulation in the area affected by the proposal. Specifically, petitioners published their notice of filing in the Vero Beach Press-Journal on May 16, 1988, and May 23, 1988.

   
   

3. On or before June 1, 1988, petitioners, pursuant to Section 381.709(3)(a), Florida Statutes, timely filed their application for the aforementioned project with the respondent, and it was assigned certificate of need number 5638. The application contained no mention that publication as required by Section 381.709(2)(d), Florida Statutes, had occurred, or any documentation thereof.

   
   

4. By letter of June 17, 1988, respondent returned petitioners certificate of need application to them, and stated:

   
   

   Section 381.709(2)(d), Florida Statutes, 1987, states in part that

   "within 14 days after filing a letter of intent, the applicant shall publish a notice of filing to be published in a newspaper of general circulation in the area affected by the proposal. The notice of filing shall be published once a week for 2 consecutive weeks on forms and in the format and content specified by the department by rule."

   
   

   Your application shows no documentation of publication of your letter of intent. Therefore, your application cannot be accepted by the Department.

   
   

5. Petitioners filed a timely protest of the respondent's decision to reject their application, and the matter was referred to the Division of Administrative Hearings to conduct a formal hearing.

   
   

   The controversy

   
   

6. Respondent relies on the provisions of Rule 10-5.008(1)(d), Florida Administrative Code, as authority for its decision to reject petitioners' application because it failed to include documentation that the notice of filing had been properly published. That rule provides:

   
   

   ...An application for a certificate

   of need shall be submitted on HRS Form 1455, August 1985, incorporated by

   reference herein, and shall be provided by the Office of Regulation and Health Facilities upon request. An application shall not be deemed complete by the department unless all information requested by the department and provided for in the application form has been submitted on the form by the applicant. An application submitted to the Office of Regulation and Health Facilities on an incorrect form, or which omits the minimum requirements specified by the department on the application form, and does not include documentation that the notice of filing has been published in a newspaper of general circulation in the applicable district or subdistrict affected by the proposal in the form specified in paragraph (1)(c) of this rule, shall not be accepted by the department.

   
   

7. Rule 10-5.008(1)(d), Florida Administrative Code, was effective November 1987. To date, it has only been applied to two batching cycles: a hospital batch which predated the subject cycle, and the subject nursing home batch.

   
   

8. Respondent avers that it has consistently interpreted its rule, as applied in this case, to mandate its rejection of applications that do not document proof of publication of the notice of filing. However, there is no proof that its interpretation has previously been challenged or explicated, and such fact does not render its interpretation necessarily reasonable.

   
   

9. The foregoing provisions of Rule 10-5.008(1)(d) Florida Administrative Code, were replicated in paragraph 5 of the "General Information" section of the "Instructions for Form 1455, Application for Certificate Need." While the instructions do not explain what respondent means by "documentation", paragraph

   6 of the "General Information" section provides:

   
   

   Additional Information: For clarification of any part of this form, contact the Office of Regulation and Health Facilities at (904) 488-8673.

   
   

10. Petitioners concede that they were familiar with the requirements of the rule requiring documentation that the notice of filing had been published. In fact, petitioners filed three other applications for a certificate of need during this review cycle, and included within such applications the standard affidavit of publication provided by the newspaper.

    
    

11. Petitioners aver that they did not submit any documentation with the application at issue in this proceeding because it was their belief that only the standard affidavit of publication would satisfy respondent's documentation requirement. Accordingly, since they did not receive the affidavit of publication by June 1, 1988, the application deadline, they elected to file their application without documentation or explanation regarding publication.

12. While petitioners' belief that the affidavit of publication would satisfy the respondent's requirement of documentation was reasonable, it was not reasonable for petitioners to conclude, absent inquiry of respondent, that such was the only form of documentation that would have been accepted by respondent. Had petitioners sought clarification from respondent, they would have learned that they could also have submitted a copy of the newspaper in which the advertisement occurred, or an affidavit attesting to the dates, place and substance of the advertisement along with the assurance that upon receipt they would submit the affidavit of publication. Petitioners did not, however, seek clarification from respondent.

    
    

13. Further, while petitioners did not receive the affidavit of publication until June 6, 1988, the proof demonstrates that it was executed on June 1, 1988. Petitioners did not, however, secure the affidavit from the newspaper at that time, and did not, after its receipt on June 6, 1988, submit it to respondent.

    
    

14. While petitioners did not submit the affidavit of publication to respondent prior to their receipt of the respondent's letter of June 17, 1988, returning their application, it is reasonable to conclude that, since they were in possession of such documentation, they would have provided it to respondent in response to a finding that their application was incomplete for such failure. They were not, however, accorded such an opportunity by the respondent.

    
    

    CONCLUSIONS OF LAW

    
    

15. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.

    
    

16. Section 381.709, Florida Statutes, establishes the process for certificate of need review. Pertinent to this case, that section provides:

    
    

    Review process. - The review process for certificates of need shall be as follows:

    * * *

    (3) APPLICATION PROCESSING.-

    (a) An applicant shall file an application with the department, and shall furnish a copy of the application to the local health council and the department. Within 15 days after the applicable application deadline established by department rule, the staff of the department shall determine if the application is complete. If the application is incomplete, the staff shall request specific information from the applicant necessary for the application to be complete; however, the staff may make only one such request.

    If the requested information is not filed with the department within 21 days of the receipt of the staff's request, the application shall be deemed incomplete and deemed withdrawn from consideration. (Emphasis added)

17. The provisions of Section 381.709(3)(a), Florida Statutes, are mandatory. They place the onus on the agency to identify for, and notify the applicant of, any deficiencies or omissions in the application which it contends renders the application incomplete. Concomitantly, the applicant has the burden of furnishing the identified information or suffering the conclusion that its application is incomplete and withdrawn from consideration. See e.g. Doheny v. Grove Isle, Ltd., 442 So.2d 966 (Fla. 1st DCA 1983)

    
    

18. In the instant case, respondent did not comply with the provisions of Section 381.709(3)(a), Florida Statutes: it failed to notify petitioners that their failure to provide documentation that the notice of filing had been published rendered their application incomplete, and failed to accord petitioners the statutorily mandated opportunity to correct such deficiency. Instead, because of such omission, respondent unilaterally rejected petitioners' application as incomplete.

    
    

19. To support its decision, respondent relies on the provisions of Rule 10-5.008(1)(d), Florida Administrative Code. That rule provides:

    
    

    ...An application for a certificate

    of need shall be submitted on HRS Form 1455, August 1985, incorporated by reference herein, and shall be provided by the Office of Regulation and Health Facilities upon request. An application shall not be deemed complete by the department unless all information requested by the department and provided for in the application form has been submitted on the form by the applicant. An applicant submitted to the Office of Regulation and Health Facilities on an incorrect form, or which omits the minimum requirements specified by the department on the application form, and does not include documentation that the notice of filing has been published in a newspaper of general circulation in the applicable district or subdistrict affected by the proposal in the form specified in paragraph (1)(c) of this rule, shall not be accepted by the department. (Emphasis added)

    
    

20. The respondent interprets the foregoing rule as mandating a rejection of an application, without an omission notice, when it fails to contain documentation that the notice of filing has been published. While the rule could be interpreted in such manner, such interpretation is not reasonable since it is contrary to the provision of the statute it was designed to implement. That statute, Section 381.709(3)(a), Florida Statutes, mandates than an applicant be notified of and given an opportunity to correct any deficiencies prior to such action.

    
    

21. Where, as here, the agency's interpretation of its own rule is clearly erroneous, the usual deference accorded an agency's interpretation of its own rules does not prevail. See City of Miami Beach v. Miller, 122 So.2d 578 (Fla.

    3d DCA 1960). Succinctly, were the agency's interpretation adopted, the rule would be contrary to the provisions of section 381.709(3)(a), Florida statutes, and, as such, could be accorded no force or effect. See Nicholas v. Wainwright,

    152 So.2d 458 (Fla. 1963) and Canal Insurance Co. v. Continental Casualty Co., 489 So.2d 136 (Fla. 2d DCA 1986)

    
    

22. The only reasonable interpretation of the agency's rule, consistent with Section 381.709(3)(a), Florida statute, is that it will not be obliged to accept, as complete, applications with the noted deficiencies. This does not, however, excuse the agency from its statutory obligation to review the application and identify for the applicant those deficiencies or omissions which it contends render the application incomplete or from according the applicant an opportunity to correct those deficiencies before rejecting the application as incomplete.

    
    

23. In light of established law, respondent's rejection of petitioners' application without compliance with Section 381.709(3)(a), Florida statutes, was improper.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered accepting petitioners'

application for review in the June 1, 1988, nursing home cycle.

DONE AND ENTERED in Tallahassee, Leon County, Florida, this 6th day of October, 1988.

WILLIAM J. KENDRICK

Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 6th day of October, 1988.

ENDNOTE

1/ The provisions of Section 381.709(3)(a), Florida Statutes, are similar to the provisions of Section 120.60(2), Florida Statutes, which likewise place the onus on the licensing agency to identify for, and notify the applicant of, any deficiencies or omissions in the application which it considers a basis for rejection of the application. The similarity of the statutes renders the decision in Doheny v. Grove Isle Ltd., supra, persuasive.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 88-3553

Petitioner's proposed findings of fact are addressed as follows:

1. Addressed in paragraphs 1 and 3.

2. Addressed in paragraph 2.

3 & 4. Addressed in paragraphs 11 and 13.

1. Addressed in paragraph 4.

2. Addressed in paragraph 7.

3. Addressed in paragraph 9.

8 & 9. Addressed in paragraphs 11 and 12.

1. Rejected as not supported by competent proof.

2. Addressed in paragraph 14.

Respondent's proposed findings of fact are addressed as follows:

1 & 2. Addressed in paragraph 10.

3. Addressed in paragraphs 11 and 13. 4-10. Addressed in paragraphs 11-13.

11-12. Addressed in paragraphs 7 and 8.

13-14. Addressed in paragraphs 6 and 9.

COPIES FURNISHED:

Robert Newell, Jr., Esquire

102 South Monroe Street Tallahassee, Florida 32301

Theodore Mack, Esquire Department of Health and

Rehabilitative Services Fort Knox Executive Center 2727 Mahan Drive, Suite 309

Tallahassee, Florida 32301

Sam Power, Clerk Department of Health and

Rehabilitative Services 1323 Winewood Boulevard Building One, Room 407

Tallahassee, Florida 32399-0700

Gregory L. Coler, Secretary Department of Health and

Rehabilitative Services 1323 Winewood Boulevard Building One, Room 407

Tallahassee, Florida 32399-0700

John Miller, Esquire Acting General Counsel Department of Health and

Rehabilitative Services Fort Knox Executive Center 2727 Mahan Drive, Suite 309

Tallahassee, Florida 32301

Docket for Case No: 88-003553

Orders for Case No: 88-003553