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Cobb Hospital, Inc. v. Department of Community Health

Supreme Court of Georgia

December 23, 2019

COBB HOSPITAL, INC. d/b/a WELLSTAR COBB HOSPITAL et al.
v.
DEPARTMENT OF COMMUNITY HEALTH et al.

          PER CURIAM.

         In Division 2 of its opinion in this case, the Court of Appeals erred by holding that the constitutional due process claim enumerated by petitioners Cobb Hospital, Inc. and Kennestone Hospital, Inc. (collectively, "Wellstar") was not preserved for appellate review because it was not ruled on during the administrative proceeding that led to the filing of this case in the trial court. See Cobb Hospital, Inc. v. Department of Community Health, 349 Ga.App. 452, 465 (825 S.E.2d 886) (2019). We grant Wellstar's petition for a writ of certiorari to address that issue, reverse that division of the Court of Appeals's opinion, and remand for that court to reconsider Wellstar's constitutional claim.[1]

         1. This case involves Wellstar's challenge to the decision by the Georgia Department of Community Health ("DCH") to grant Emory University Hospital Smyrna ("Emory") a new certificate of need ("CON") to renovate a hospital that Emory had recently acquired. After DCH made an initial decision granting the CON, Wellstar appealed to the CON Appeal Panel. The panel's hearing officer affirmed the decision, ruling that as a matter of law he could not consider Wellstar's arguments regarding the validity of Emory's existing CON, and that he would not allow Wellstar to present evidence related to those arguments. Wellstar then appealed the hearing officer's decision to the DCH Commissioner, allegedly arguing among other things that the decision violated Wellstar's constitutional right to due process. The Commissioner affirmed the hearing officer's decision without ruling on the constitutional claim.

         Wellstar then filed a petition for judicial review in the Cobb County Superior Court ("trial court"). In its petition, Wellstar raised its constitutional claim as its second enumeration of error, arguing that the hearing officer's decision violated Wellstar's right to due process because the decision prevented Wellstar from presenting evidence that Emory's existing CON was invalid. Wellstar claimed that the administrative decision was thus "made upon unlawful procedures." In its order denying Wellstar's petition, the trial court ruled that the DCH decision "does not violate constitutional or statutory provisions . . . [and] was not made upon unlawful procedures," and the court "reject[ed] Wellstar's argument" made in its second enumeration.

         Wellstar then filed an application for discretionary appeal in the Court of Appeals, which that court granted. In their briefs in the Court of Appeals, DCH argued that Wellstar did not adequately raise its constitutional claim during the administrative process and Emory addressed Wellstar's due process claim on the merits. Neither DCH nor Emory argued that the CON Appeal Panel's hearing officer or the DCH Commissioner was required to rule on Wellstar's claim to preserve it for appellate review (nor did DCH or Emory argue that the trial court failed to rule on the claim).

         In Division 2 of its opinion, the Court of Appeals pretermitted whether Wellstar properly raised its due process claim before the CON Appeal Panel and held that Wellstar had not preserved the claim for appellate review because "a review of the decisions by the panel hearing officer and the DCH commissioner reveals that neither official ruled on that distinct issue." Cobb Hospital, Inc., 349 Ga.App. at 465. In support of this holding, the Court of Appeals cited two cases that both hold that appellate courts may decide a constitutional claim only if it was ruled on by the trial court. See id. (citing Singleton v. Dept. of Human Resources, 263 Ga.App. 653, 654 (825 S.E.2d 886) (2003), and John Hardy Group, Inc. v. Cayo Largo Hotel Assoc., 286 Ga.App. 588, 589 (649 S.E.2d 826) (2007)). The Court of Appeals rejected Wellstar's several other claims, and it affirmed the trial court's judgment. See id. at 456-465.

         Wellstar petitioned for a writ of certiorari, arguing among other things that the Court of Appeals erred in holding that Wellstar's constitutional claim was not preserved because it was not ruled on during the administrative proceeding. We agree.

         2. During an ongoing administrative proceeding, a party generally must raise its constitutional claims in order to exhaust administrative remedies and preserve the claims for judicial review, even though administrative agencies generally have no authority to rule on those claims. See Dept. of Human Services v. Addison, 304 Ga. 425, 431-433 (819 S.E.2d 20) (2018) ("Although an administrative agency cannot declare laws to be unconstitutional, the agency may take account of constitutional considerations in deciding whether and how to enforce challenged statutes and rules and what the parties' rights are under them, and if the challenger remains aggrieved after the agency renders its final decision, judicial review is then normally available."). See also State Health Planning Agency v. Coastal Empire Rehab. Hosp., 261 Ga. 832, 832 & n.1 (412 S.E.2d 532) (1992); OCGA § 50-13-19 (a); Ga. Comp. R. & Regs. r. 616-1-2-.22 (3). So long as the party properly raises its constitutional claims during the administrative process, the claims may later be raised in and reviewed by the trial court. See Coastal Empire Rehab. Hosp., 261 Ga. at 832; OCGA § 50-13-19 (h). To then preserve constitutional claims for review by an appellate court, the party must raise the claims before the trial court and the trial court must distinctly rule on the claims. See Advanced Disposal Services Middle Georgia, LLC v. Deep South Sanitation, LLC, 296 Ga. 103, 108 (765 S.E.2d 364) (2014); East Georgia Land and Development Co., LLC v. Baker, 286 Ga. 551, 555-556 (690 S.E.2d 145) (2010).

         In holding that Wellstar's constitutional claim was not preserved for appellate review because it was not ruled on during the administrative proceeding, the Court of Appeals appears to have confused the requirement that a constitutional claim be raised during the administrative proceeding to preserve it for review by the trial court with the separate requirement that the trial court distinctly rule on the claim to preserve it for review on appeal. Because administrative agencies generally cannot rule on constitutional claims, the Court of Appeals's holding was erroneous.[2]

         Accordingly, we grant Wellstar's petition for a writ of certiorari with regard to the constitutional claim preservation issue, reverse Division 2 of the Court of Appeals's opinion, and remand the case for that court to reconsider the constitutional claim, including DCH's argument that Wellstar did not properly raise its constitutional claim during the administrative process. We express no opinion on that argument or the merits of the claim.

         Petition for writ of certiorari granted in part, judgment reversed in part, and case remanded with direction.

          All the Justices concur, except Warren and Bethel, JJ., not participating, and Ellington, J., disqualified.

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