St. Francis Mem. Hosp. v. CA Dept. of Pub.Health ( 2018 )

Filed 5/23/18; pub. order 6/15/18 (see end of opn.)
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION ONE
SAINT FRANCIS MEMORIAL
HOSPITAL,
Plaintiff and Appellant, A150545
v. (San Mateo County
CALIFORNIA DEPARTMENT OF Super. Ct. No. CIV 537118)
PUBLIC HEALTH,
Defendant and Respondent.
Saint Francis Memorial Hospital (Saint Francis) petitioned for a writ of
administrative mandate after being fined by the California Department of Public Health
(Department). The trial court sustained the Department’s demurrer based on the statute
of limitations, and judgment was entered in the Department’s favor. On appeal, Saint
Francis argues that the court erred by sustaining the demurrer because the petition was
timely under the applicable statutes, the limitations period was equitably tolled, and the
Department is equitably estopped from claiming the petition was filed late. We affirm.
I.
FACTUAL AND PROCEDURAL
BACKGROUND
This case arose after surgical staff at Saint Francis left a sponge in a patient during
the patient’s back surgery in 2010. The patient was required to endure a second surgery
and be treated with powerful intravenous antibiotics. As a result of this incident, the
Department imposed a $50,000 fine on Saint Francis for not having appropriate sponge-
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count policies and for not effectively training on, and ensuring compliance with, such
policies. Saint Francis challenged the fine, and a hearing was held before an
Administrative Law Judge (ALJ). The ALJ issued a proposed decision finding no basis
for the fine because Saint Francis had adequate policies and procedures to guard against
the mistakes that led to the incident.
On December 15, 2015, after receiving further briefing and evidence, the
Department issued a final decision that rejected the ALJ’s proposed decision, determined
that Saint Francis had not implemented an appropriate sponge-count policy, and affirmed
the fine. The decision was “effective immediately,” and it was served on Saint Francis
by certified mail the next day, December 16.
On December 30, 2015, Saint Francis submitted a request for reconsideration.
The Department answered the request without “notif[ying Saint Francis] that the request
. . . was void or otherwise invalid,” and then denied it on January 14, 2016. Also on
January 14, apparently not knowing that the request for reconsideration had been or was
being denied, counsel for Saint Francis e-mailed a Department attorney that Saint Francis
intended to file a writ petition. In the e-mail, St. Francis’s counsel also stated, “As I read
the statute [the Department] has until today to accept or reject the request [for
reconsideration]. If no action is taken it is deemed denied. I think the additional five
days for mailing arguably applies; do you agree? This would extend to next Tuesday to
decide the request.” The Department attorney responded by e-mail, “I believe you are
correct.”
Saint Francis filed its writ petition in the trial court on January 26, 2016. The
Department demurred on the basis that the petition was not timely. The court sustained
the demurrer with “leave to amend to allege additional facts necessary to assert the
equitable tolling of the statute of limitations.”
Saint Francis then filed an amended petition, to which the Department also
demurred. The trial court again sustained the demurrer, this time without leave to amend.
It found that the Department’s decision “was effective immediately and was thus not
subject to a Request for Reconsideration” and that the subsequent writ petition “was not
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filed within the thirty days required by Government Code section 11521.”1 The court
also found that Saint Francis’s “mistake was as to law, not facts. A mistake not caused
by the [Department] is not a sufficient basis to excuse [a] late filing.”
II.
DISCUSSION
A. The Request for Reconsideration Did Not Extend the Deadline to File a
Writ Petition.
We begin with an overview of the statutes governing the timing for filing a request
to reconsider an agency decision and for filing a petition for a writ of administrative
mandate challenging an agency’s final decision. Section 11521 sets forth the time period
governing a party’s request to reconsider an agency decision. It states, “The power to
order a reconsideration shall expire 30 days after the delivery or mailing of a decision to a
respondent, or on the date set by the agency itself as the effective date of the decision if
that date occurs prior to the expiration of the 30-day period.” (§ 11521, subd. (a); see
also § 11519, subd. (a).) Thus, when an agency makes its decision effective immediately,
as the Department did here, it “eliminat[es] the 30-day period for reconsideration.” (De
Cordoba v. Governing Board (1977) 71 Cal.App.3d 155, 158.)
Section 11523 sets forth the limitations period that applies to a writ petition to
challenge an agency’s final decision. It requires the petition to “be filed within 30 days
after the last day on which reconsideration can be ordered.” (§ 11523.) Where, as here,
reconsideration is unavailable, “the earliest date upon which an . . . agency’s decision can
become effective, thereby commencing the limitations period of section 11523, is the
date on which the decision is mailed or delivered.” (Koons v. Placer Hills Union Sch.
Dist. (1976) 61 Cal.App.3d 484, 490.) We review de novo whether a trial court has
properly sustained a demurrer on the basis of the statute of limitations. (Ramirez v.
Tulare County Dist. Attorney’s Office (2017) 9 Cal.App.5th 911, 924; E-Fab, Inc. v.
Accountants, Inc. Services (2007) 153 Cal.App.4th 1308, 1315.)
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All subsequent statutory references are to the Government Code.
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Here, the Department’s decision was issued on December 15, 2015, and it was
mailed to the parties the next day. Because the decision stated it was effective
immediately, there was no period in which to file a request for reconsideration, and the
30-day period for filing a writ petition started to run on the day the decision was mailed,
December 16. The last day to file any such petition was therefore January 15, 2016.
Saint Francis insists that January 15, 2016, was not the deadline for filing the writ
petition because it filed its request for reconsideration. It contends that under
section 11518.5, “the service of a request for reconsideration extends the time to file a
Petition for Administrative Mandamus by 15 days.” We are not persuaded. The statute
provides that “[w]ithin 15 days after service of a copy of the decision on a party, but not
later than the effective date of the decision, the party may apply to the agency for
correction of a mistake or clerical error in the decision.” (§ 11518.5, subd. (a).) This
provision is plainly inapplicable. Not only did Saint Francis request reconsideration
“later than” the effective date of the Department’s decision, it sought substantive
changes, not correction of a mistake or clerical error.
Rather, the provision authorizing a request for reconsideration of the merits of an
agency’s decision is section 11521, which, as we have explained, establishes that the time
to request reconsideration expires “on the date set by the agency itself as the effective
date of the decision.” (§ 11521, subd. (a).) Since the effective date of the Department’s
decision here was December 15, and since the decision was served on the parties the next
day, there was effectively no period in which to seek reconsideration.2 The deadline for
filing a writ petition was therefore 30 days from the date the decision was served, making
the deadline January 15, 2016. Saint Francis’s petition filed 11 days after that deadline
was untimely under the applicable statutes.
2
Saint Francis claims the Department waived the argument that reconsideration
was unavailable by failing to say so when it answered the request for reconsideration.
Saint Francis cites no authority in support of its position, and we therefore do not
consider it. (See Badie v. Bank of America (1998) 67 Cal.App.4th 779, 784-785.)
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B. The Trial Court Properly Rejected Saint Francis’s Claims that Equitable
Tolling and Equitable Estoppel Apply.
Saint Francis next argues that it is entitled to a tolling of the 30-day time period to
file its writ petition or to equitably estop the Department from claiming that the petition
was untimely. These arguments present closer questions, but we conclude that they are
ultimately unavailing.
1. Saint Francis is not entitled to a tolling of the 30-day period.
Saint Francis’s first equitable argument is that it is entitled to a tolling of the 30-
day period because there was “an underlying mistake, which led to the running of the
[period].” We accept that there was an underlying mistake, but we disagree that it
justifies a tolling of the 30-day period. “The Administrative Procedure Act (Gov. Code,
§ 11500 et seq.) sets strict time deadlines for judicial challenges to administrative
decisions.” (Hansen v. Board of Registered Nursing (2012) 208 Cal.App.4th 664, 669
(Hansen).) “ ‘As with any other cause of action, a proceeding for writ of mandamus is
barred if not commenced within the prescribed limitation period. [Citations.] Statutes of
limitation “are, of necessity, adamant rather than flexible in nature” and are “upheld and
enforced regardless of personal hardship.” ’ ” (California Standardbred Sires Stakes
Com., Inc. v. California Horse Racing Bd. (1991) 231 Cal.App.3d 751, 756.)
The doctrine of equitable tolling applies “ ‘ “[w]hen an injured person has several
legal remedies and, reasonably and in good faith, pursues one.” ’’ ” (McDonald v.
Antelope Valley Community College Dist. (2008) 45 Cal.4th 88, 99-100; see also Addison
v. State of California (1978) 21 Cal.3d 313, 317; California Standardbred Sires Stakes
Com., Inc. v. California Horse Racing Bd., supra, 231 Cal.App.3d at p. 759.) As do the
parties, we look to Hansen for guidance on whether that doctrine applies here.
In Hansen, the Court of Appeal rejected a claim that section 11523’s 30-day
period was tolled based on an untimely request for reconsideration. (Hansen, supra,
208 Cal.App.4th at pp. 672-673.) In that case, the Board of Registered Nursing revoked
the license of a nurse by default after issuing an accusation to which she did not respond.
(Id. at pp. 667-668.) About three months after the Board’s decision, the nurse requested
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reconsideration of the revocation because, due to an address change, she had not received
either the accusation or the decision. (Ibid.) Months later, the Board denied her request
because the revocation was already final, and she then filed a writ petition within 30 days
of the denial of her request. (Id. at p. 668.) The trial court denied the petition as
untimely, and the Court of Appeal affirmed. (Id. at p. 667.)
Hansen concluded that “[t]he Board’s delay in responding to [the petitioner’s]
reconsideration request did not toll the 30-day limitations period of . . . section 11523.”
(Hansen, supra, 208 Cal.App.4th at p. 672.) The appellate court ruled that the Board
“had no obligation to notify [the petitioner] it had denied her motion for reconsideration,”
and the Board’s notice of its denial “did not extend the reconsideration period.” (Id. at
p. 673.) The court explained that equitable tolling applies when “a party with multiple
available remedies pursues one in a timely manner,” and the petitioner “did not seek
relief from the Board [i.e., reconsideration] until it was too late.” (Id. at pp. 672-673.)
Similarly, we conclude that Saint Francis’s request for reconsideration did not constitute
the timely pursuit of an available remedy since reconsideration was unavailable, and the
Department’s failure to indicate that reconsideration was unavailable in answering the
request did not toll the deadline for filing a writ petition.
Saint Francis attempts to distinguish Hansen on various grounds. First, it points
out that the Board’s decision in Hansen was the result of a default, while the
Department’s decision here came after a two-day hearing followed by the submission of
additional briefing and evidence. We see no reason, however, why it would matter for
purposes of tolling the 30-day period whether an agency’s decision was the result of a
default as opposed to active litigation: if anything, the position of the Hansen petitioner
was stronger because she did not have actual notice of the proceedings until it was too
late to file a request for reconsideration. Second, Saint Francis claims that, unlike the
request for reconsideration in Hansen, its request for reconsideration was timely. But as
we have already discussed, reconsideration was simply unavailable, as the Department’s
decision was effective immediately. Finally, Saint Francis maintains that it acted in good
faith and that, unlike the Board in Hansen, the Department was notified “that there would
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be a writ petition pursued.” We accept that Saint Francis’s mistake about the availability
of reconsideration was made in good faith, and we agree that Saint Francis notified the
Department of its intent to file a writ petition, but these circumstances are insufficient to
toll the running of the 30-day period.
2. The Department was not equitably estopped from claiming the petition was
untimely.
Saint Francis’s second equitable argument is that the trial court erred in refusing to
equitably estop the Department from claiming that the petition was untimely. Again, we
are not persuaded.
There are four basic elements of equitable estoppel: (1) the party to be estopped
must have known the facts; (2) the party to be estopped must have intended that its
conduct would be acted upon, or it must have acted so as to have given the party asserting
estoppel the right to believe that it was so intended; (3) the party asserting estoppel must
have been ignorant of the true state of facts; and (4) the party asserting estoppel must
have relied on the conduct to its injury. (Schafer v. City of Los Angeles (2015)
237 Cal.App.4th 1250, 1261.) An additional element is required when estoppel is sought
against the government. “In such a case, the court must weigh the policy concerns to
determine whether the avoidance of injustice in the particular case justifies any adverse
impact on public policy or the public interest.” (Ibid.) While the parties agree that these
five elements apply, they disagree on their application.
Saint Francis insists that the Department “lulled [it] into a false sense of security”
by not promptly informing it that its reconsideration request was untimely. But this
argument ignores Saint Francis’s own responsibility for its mistaken conclusion that
reconsideration was available. True enough, the Department seems to have also been
confused about its authority, demonstrated by both its attorney’s response to Saint
Francis’s counsel’s e-mail and its answering the reconsideration request without
mentioning that the request was “void or otherwise invalid.” But this is not the type of
conduct upon which estoppel may be based.
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To begin with, the Department made no affirmative representations to incite Saint
Francis’s mistaken understanding of the law. (See Elliott v. Contractors’ State License
Bd. (1990) 224 Cal.App.3d 1048, 1053 [“Some affirmative misleading conduct on the
part of the agency appears necessary to support a finding of estoppel”].) Not correcting
another party’s legal misunderstanding due to one’s own confusion is different from
inducing the misunderstanding in the first place. Furthermore, it was not the
Department’s responsibility to ensure that counsel for Saint Francis understood the
procedural rules, and any reliance by Saint Francis on the Department’s failure to correct
Saint Francis’s misunderstanding was unreasonable. (See La Canada Flintridge
Development Corp. v. Department of Transportation (1985) 166 Cal.App.3d 206, 222
[reliance “based on an erroneous interpretation of the law is not reasonable reliance”].)
Lastly, not correcting another’s legal misunderstanding falls short of the kind of conduct
required to apply estoppel against the government. Such an application ordinarily lies
only “ ‘in unusual instances when necessary to avoid grave injustice and when the result
will not defeat a strong public policy.’ ” (Steinhart v. County of Los Angeles (2010)
47 Cal.4th 1298, 1315.) The dismissal of Saint Francis’s petition, while not the result
Saint Francis sought, caused no such grave injustice, and estopping the Department from
claiming that the petition was untimely would defeat the oft-repeated public policy of
strictly construing the filing period for challenging an agency’s final decision. (Hansen,
supra, 208 Cal.App.4th at pp. 669, 675.) In sum, although we are sympathetic to Saint
Francis’s position, we can find no basis for overturning the trial court’s ruling.
III.
DISPOSITION
The judgment is affirmed. Respondent is awarded its costs on appeal.
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_________________________
Humes, P.J.
We concur:
_________________________
Dondero, J.
_________________________
Banke, J.
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Filed 6/15/18
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION ONE
SAINT FRANCIS MEMORIAL
HOSPITAL, A150545
Plaintiff and Appellant,
(San Mateo County
v. Super. Ct. No. CIV 537118)
CALIFORNIA DEPARTMENT OF
PUBLIC HEALTH, ORDER CERTIFYING OPINION
FOR PUBLICATION
Defendant and Respondent. [NO CHANGE IN JUDGMENT]
THE COURT:
The opinion in the above-entitled matter filed on May 23, 2018, was not certified
for publication in the Official Reports. After the court’s review of a request under
California Rules of Court, rule 8.1120, and good cause established under rule 8.1105, it is
hereby ordered that the opinion should be published in the Official Reports.
Dated:
___________________________
Humes, P.J.
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Trial Court:
Superior Court of the County of San Mateo
Trial Judge:
Hon. George A Miram
Counsel for Plaintiff and Appellant:
Cyrus A. Tabari; Sheuerman, Martini, Tabari, Zenere & Garvin
Counsel for Defendant and Respondent:
Xavier Becerra, Attorney General
Susan M. Carson, Supervising Deputy Attorney General
Gregory D. Brown, Deputy Attorney General
Nimrod P. Elias, Deputy Attorney General
Saint Francis Memorial Hospital v. California Department of Public Health A150545
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