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Doctors Hospital of Augusta, LLC v. Georgia Department of Community Health

Court of Appeals of Georgia, Fifth Division

February 14, 2018

DOCTORS HOSPITAL OF AUGUSTA, LLC
v.
GEORGIA DEPARTMENT OF COMMUNITY HEALTH, et al.

          McFADDEN, P. J., RAY, and SELF, JJ.

          Self, Judge.

         Doctors Hospital of Augusta, LLC appeals from a superior court's order dismissing its petition for judicial review challenging the Georgia Department of Community Health's decision to grant a Certificate of Need ("CON") to MCG Health, Inc. d/b/a Georgia Regents Medical Center ("Georgia Regents").[1] Doctors Hospital asserts that the trial court erred for numerous alternative reasons when it relied upon the prior pending action doctrine to dismiss its case. For the reasons explained below, we reverse.

          We conduct a de novo review of a trial court's order dismissing a case based upon the prior pending action doctrine. Brock v. C & M Motors, 337 Ga.App. 288, 290 (1) (787 S.E.2d 259) (2016). Two portions of the Civil Practice Act are implicated in this doctrine that "are closely related in effect and are to be considered and applied together." (Citation and punctuation omitted.) Id. OCGA § 9-2-5 (a) provides:

No plaintiff may prosecute two actions in the courts at the same time for the same cause of action and against the same party. If two such actions are commenced simultaneously, the defendant may require the plaintiff to elect which he will prosecute. If two such actions are commenced at different times, the pendency of the former shall be a good defense to the latter.

OCGA § 9-2-44 (a) states:

A former recovery or the pendency of a former action for the same cause of action between the same parties in the same or any other court having jurisdiction shall be a good cause of abatement. However, if the first action is so defective that no recovery can possibly be had, the pendency of a former action shall not abate the latter.

         The purpose of the doctrine embodied in these statutes "is to ensure judicial economy, to avoid inconsistent judgments, and to prevent harassment of the parties through multiple proceedings." (Citations and punctuation omitted.) Brock, 337 Ga.App. at 290 (1). But it can only be applied where the causes of action and the parties are the same. Oskouei v. Orthopaedic & Spine Surgery of Atlanta, 340 Ga.App. 67, 69 (796 S.E.2d 299) (2017). Additionally, the rule does not apply "[i]f it appears from the face of the pleadings in the first-filed case that the court therein does not have jurisdiction to resolve the pending claims on the merits, then the . . . later-filed suit may proceed forward." (Citations omitted.) Bhindi Brothers v. Patel, 275 Ga.App. 143, 146 (619 S.E.2d 814) (2005). With these principles in mind, we turn to the procedural history of this case.

         On November 26, 2014, the Department of Community Health granted a CON to Georgia Regents. Doctors Hospital, which had applied and competed for the same CON, appealed the grant of the CON to the CON Appeal Panel.

         On May 1, 2015, before the appeal panel could conduct a de novo evidentiary hearing, Doctors Hospital and two physicians practice groups filed a petition in Fulton County Superior Court seeking: (1) a declaratory judgment that a "county-financed exception" regulation created by the Department of Community Health was invalid; and (2) a writ of mandamus compelling the Commissioner of the Department of Community Health to deny Georgia Regent's CON application. The petition states that Doctors Hospital had appealed the grant of the CON and that an administrative hearing was scheduled to begin on June 22, 2015. In the mandamus portion of the petition, Doctors Hospital alleged that "[t]he administrative review does not provide an equally convenient, complete and beneficial relief to Doctors Hospital, as it cannot consider the impact on Doctors Hospital as a property owner in Columbia County."

         On June 10, 2015, the Department of Community Health and its Commissioner moved to dismiss the petition based upon a lack of subject matter jurisdiction, arguing in their supporting briefs that the superior court lacked subject matter jurisdiction because no exception to the administrative exhaustion requirement, a condition precedent to suit, applied. They submitted no evidence in support of their legal argument that a declaratory judgment action was improper while administrative proceedings were in progress, and asserted that if "Doctors Hospital is aggrieved by the administrative decision, it may petition for judicial review."

         On September 21, 2015, the superior court heard oral argument on the motion to dismiss. On October 13, 2015, the superior court dismissed the declaratory judgment action because it lacked subject matter jurisdiction based upon Doctors Hospital's failure to exhaust its administrative remedies and its lack of standing. On November 12, 2015, Doctors Hospital filed a notice of direct appeal. This Court dismissed the appeal on June 15, 2016, based upon Doctors Hospital's failure to follow the discretionary appeal procedures, and the Supreme Court denied Doctors Hospital's petition for a writ of certiorari on February 27, 2017.

         Before the superior court entered its ruling on the motion to dismiss the declaratory judgment action, the hearing officer in the administrative action issued a decision on September 24, 2015, upholding the grant of a CON to Georgia Regents. On November 23, 2015, the Department of Community Health adopted the findings of the hearing officer and issued a final decision awarding the CON to Georgia Regents.

         On December 23, 2015, Doctor's Hospital filed a second action in superior court - a petition for judicial review of the final agency decision granting the CON. In its enumerations of errors, it raised the same objections to the county-financed exception it had raised in the declaratory judgment action, but also asserted that the final decision was arbitrary and capricious, contained legal ...


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