TropiFlora, LLC, as agent for MariJ Agricultural, Inc., and Dennis and Linda Cathcart, d/b/a TropiFlora Nursery v. Florida Department of Health

FIRST DISTRICT COURT OF APPEAL
STATE OF FLORIDA
_____________________________
No. 1D20-1372
_____________________________
TROPIFLORA, LLC, as agent for
MariJ Agricultural, Inc., and
Dennis and Linda Cathcart,
d/b/a TropiFlora Nursery,
Appellant,
v.
FLORIDA DEPARTMENT OF
HEALTH,
Appellee.
_____________________________
On appeal from the Circuit Court for Leon County.
Angela C. Dempsey, Judge.
September 7, 2022
RAY, J.
This appeal arises from a final judgment for the Florida
Department of Health in an action brought by TropiFlora, LLC, as
agent for MariJ Agricultural, Inc. and Dennis and Linda Cathcart
d/b/a TropiFlora Nursery, seeking a declaration that it is entitled
to licensure as a medical marijuana treatment center under
section 381.986(8)(a)2.1., Florida Statutes (2019). For the reasons
below, we affirm.
I.
In July 2015, TropiFlora applied for one of five regional
licenses in the state to cultivate and distribute medical marijuana
as a dispensing organization (“DO”) under the now-repealed
Compassionate Medical Cannabis Act of 2014 (the “2014 Law”).
Only nurseries meeting certain statutory criteria could apply for
DO licensure. § 381.986(5)(b)1., Fla. Stat (2015). As part of the
application process, the nurseries needed to provide certified
financial statements to the Department to show “[t]he financial
ability to maintain operations for the duration of the 2-year
approval cycle.” § 381.986(5)(b)5., Fla. Stat. Through negotiated
rulemaking, the Department established procedures for DO
application, approval, and authorization. Fla. Admin. Code R. 64-
4.001(1), 64-4.002(2)(f)1. (2015). These rules included a warning
that if applicants failed to provide the required documentation,
their application would be denied prior to scoring. Fla. Admin.
Code R. 64-4.002(4).
TropiFlora’s application included a certificate of nursery
registration issued to TropiFlora, but it did not include certified
financial statements for TropiFlora itself. Instead, it relied on
financial statements for MariJ, a separate corporate entity from
TropiFlora. Neither MariJ nor the Cathcarts applied for licensure,
and neither of them satisfies the requirements for licensure.
The Department notified TropiFlora that the company’s
application failed to include the statutorily required financial
statements. Although the Department gave TropiFlora fourteen
days to cure the deficiency, TropiFlora failed to do so. Instead, it
contended that because MariJ was a “shareholder” of TropiFlora,
it believed the financial statements of MariJ were enough to
comply with the statute and rules. In November 2015, the
Department notified TropiFlora that its application was denied for
failure to cure the cited deficiency.
TropiFlora filed a formal written protest under chapter 120,
Florida Statutes, challenging the denial of its license application
(the “2015 Petition”). The Department referred the petition to the
Division of Administrative Hearings, which consolidated
TropiFlora’s proceeding with the proceedings of other challengers
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for the same regional license. But two months before the scheduled
final hearing, TropiFlora instituted the circuit court action at issue
in this appeal and voluntarily dismissed its administrative
petition, abandoning its administrative remedy before the process
was completed.
TropiFlora later filed an amended complaint in circuit court
“as agent for” MariJ and the Cathcarts. Both the complaint and
amended complaint stemmed from chapter 2016-123, Laws of
Florida (the “2016 Law”), a then-recent statutory amendment that
authorized a limited expansion of available DO licenses within the
five regions. In TropiFlora’s view, the 2016 Law allowed an
applicant that was previously denied DO approval to sue in circuit
court and obtain a de novo determination on entitlement to
licensure.
While the amended complaint was pending, the legislature
completely rewrote section 381.986, Florida Statutes (the “2017
Law”), to implement a constitutional amendment approved by the
voters in late 2016. The amendment allows qualifying patients to
access medical marijuana with higher THC content and authorizes
the use of medical marijuana to treat a broader range of medical
conditions than the 2014 Law. See art. X, § 29(b)(1), (b)(4), Fla.
Const.
Relevant to this appeal, the 2017 Law no longer provided for
the licensure of DOs, replacing them with medical marijuana
treatment centers (MMTCs) that have additional requirements.
The 2017 Law provided for the conversion of existing DO licenses
to MMTC licenses and for the Department to issue additional
MMTC licenses to certain former DO applicants whose
applications were “reviewed, evaluated, and scored by the
Department” under the 2014 Law. § 381.986(8)(a)2.a., Fla. Stat.
(2017). The 2017 Law also retained (and moved) the requirement
that applicants submit certified financial statements to the
Department. § 381.986(8)(b)7., Fla. Stat. (2017).
After the 2017 Law went into effect, TropiFlora filed a second
amended complaint, this time seeking a declaratory judgment that
TropiFlora, MariJ, and the Cathcarts, collectively, were entitled to
MMTC licensure under the 2017 Law. TropiFlora contended that
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its application should have been scored by the Department in 2015
and if it were scored by the Department now, TropiFlora would be
entitled to an MMTC license.
Then, in August 2018, while the declaratory judgment action
was still pending, TropiFlora sent a formal request to the
Department for MMTC licensure under the 2017 Law. The
Department denied the request, and TropiFlora filed an
administrative petition contesting that denial (the “2018
Petition”). In short, TropiFlora raised the same argument at issue
in its circuit court action—that “but for” the Department’s
improper refusal to score its 2015 application, TropiFlora would be
entitled to an MMTC license under the 2017 Law.
The Department dismissed TropiFlora’s petition with
prejudice and denied its request for MMTC licensure. The
Department found that TropiFlora did not (and cannot) meet the
criteria for MMTC licensure because its 2015 application was not
“reviewed, evaluated, and scored,” as required for MMTC licensure
under the 2017 Law. The Department also concluded that by
voluntarily dismissing its 2015 Petition, TropiFlora had waived
any challenge to the Department’s decision not to score its
application. Although the final order included the statutorily
required notice advising TropiFlora of its right to judicial review,
TropiFlora let that right expire without filing an appeal.
About nine months later, the circuit court held a bench trial
on TropiFlora’s second amended complaint. In the end, the court
concluded that TropiFlora was not entitled to relief based on five
independent and alternative grounds. First, TropiFlora lacked
standing to bring the action as an agent for MariJ and the
Cathcarts. Second, TropiFlora’s claim is barred by the doctrines of
administrative finality and the exhaustion of administrative
remedies. Third, TropiFlora does not and cannot satisfy the
minimum statutory requirements for MMTC licensure under the
2017 Law. Fourth, the Department did not have to score
incomplete applications. And fifth, the court could not compel the
Department to score TropiFlora’s application under the now-
repealed 2014 Law. This appeal followed.
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II.
Of the five independent and alternative rulings of the trial
court, we conclude that each was sufficient on its own to support
an entry of final judgment in favor of the Department.
A.
We turn first to the issue of standing; that is, whether
TropiFlora could bring this action “as agent for” MariJ and the
Cathcarts. Whether a party has standing is a pure question of law
that we review de novo. McCarty v. Myers, 125 So. 3d 333, 336 (Fla.
1st DCA 2013). “Florida Rule of Civil Procedure 1.210(a), the real
party in interest rule, ‘permits an action to be prosecuted in the
name of someone other than, but acting for, the real party in
interest.’” Robinson v. Nationstar Mortg., LLC, 301 So. 3d 1059,
1062 (Fla. 2d DCA 2019) (quoting Russel v. Aurora Loan Servs.,
LLC, 163 So. 3d 639, 642 (Fla. 2d DCA 2015)). The “real party in
interest” is “the person in whom rests, by substantive law, the
claim sought to be enforced.” Fla. R. Civ. P. 1.210 cmt.
Here, TropiFlora sought to act as a nominal plaintiff, bringing
the declaratory judgment action on behalf of or as the agent for
MariJ and the Cathcarts. But the undisputed evidence showed
that MariJ and the Cathcarts are not the real parties in interest.
TropiFlora was the entity that applied for DO licensure in 2015,
not MariJ or the Cathcarts. Neither MariJ nor the Cathcarts ever
applied for a license. Nor could they, because they did not and
cannot satisfy the requirements for either DO or MMTC licensure.
Thus, individually, MariJ and the Cathcarts have no personal and
individual stake in DO licensure, and the trial court correctly
determined that TropiFlora cannot sue on their behalf. See Reibel
v. Rolling Green Condo. A, Inc., 311 So. 2d 156, 158 (Fla. 3d DCA
1975) (holding that the trial court erred by denying the defendant’s
motion to dismiss when the plaintiffs seeking a declaratory
judgment were not the real parties in interest and thus lacked
standing).
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B.
Even if TropiFlora had standing to sue on behalf of MariJ and
the Cathcarts, we would affirm the order on appeal because
TropiFlora failed to challenge all of the independent, alternative
reasons the trial court relied on for granting final judgment in the
Department’s favor. See B.T. v. Dep’t of Child. & Fams., 300 So. 3d
1273, 1278–79 (Fla. 1st DCA 2020); see also Boggs v. Aetna Cas. &
Sur. Co., 341 So. 2d 1071, 1071 (Fla. 1st DCA 1977) (explaining
“that when an order of the trial court purports to be based upon
several alternative grounds it will not be disturbed on appeal if one
of the grounds is sufficient for the action taken even though
another recited alternative ground is erroneous”).
In particular, TropiFlora failed to challenge the trial court’s
determination that TropiFlora does not satisfy the statutory
requirements for MMTC licensure under the 2017 Law. Nor can it.
The statute expressly limits licensure to those applicants whose
applications were “scored” by the Department. § 381.986(8)(a)2.a.,
Fla. Stat. So regardless of whether TropiFlora’s application should
have been scored when it was submitted in 2015, the fact remains
that it was not. Thus, TropiFlora is ineligible, as a matter of law,
for the MMTC license that it seeks.
C.
We also agree with the trial court that TropiFlora’s complaint
is barred by the doctrines of administrative finality and exhaustion
of administrative remedies. TropiFlora abandoned its first
administrative remedy and let the second one expire.
“The doctrine of decisional finality provides that there must
be a ‘terminal point in every proceeding both administrative and
judicial, at which the parties and the public may rely on a decision
as being final and dispositive of the rights and issues involved
therein.’” Fla. Power Corp. v. Garcia, 780 So. 2d 34, 44 (Fla. 2001).
An issue is precluded from being relitigated between the same
parties when there are common facts and issues presented in
different proceedings and there has not been a significant change
in circumstances. Id.6
The exhaustion of administrative remedies doctrine requires
that “with rare exception relating usually to matters not
cognizable in the circuit court, a party cannot resort to the courts
for a decision until administrative remedies are exhausted.” City
of Sunny Isles Beach v. Publix Super Mkts., Inc., 996 So. 2d 238,
239 (Fla. 3d DCA 2008). “The exhaustion requirement includes
‘pursuing an appeal from an administrative ruling where a method
of appeal is available.’” Agency for Health Care Admin. v. Best Care
Assurance, LLC, 302 So. 3d 1012, 1015 (Fla. 1st DCA 2020)
(quoting Robinson v. Dep’t of Health, 89 So. 3d 1079, 1081 (Fla. 1st
DCA 2012)).
Although in exceptional cases a declaratory judgment action
may be used to collaterally attack a final agency action, this is not
one of those cases. See Baker Cnty. Med. Servs., Inc. v. State, 178
So. 3d 71, 74–75 (Fla. 1st DCA 2015) (recognizing such an
exception if an agency acts in excess of its statutory authority or
without the benefit of any rule); Sch. Bd. of Leon Cnty. v. Mitchell,
346 So. 2d 562, 565–68 (Fla. 1st DCA 1977) (reaffirming that
declaratory judgment actions may not replace established
procedures of administrative appeal or review, except when
agencies act beyond their powers or flagrantly violate the
constitutional or statutory rights of a party).
Here, the Department’s actions were not excessive or
arbitrary. Instead, the Department acted well within its duties
under the rules and enabling statute when it denied TropiFlora’s
application for DO licensure because TropiFlora failed to provide
the required financial information. The Department then provided
TropiFlora with the statutorily required notice and opportunity to
challenge that decision. TropiFlora pursued administrative
review, but later voluntarily dismissed its 2015 Petition and
abandoned its remedy before the administrative process
concluded. When the Department dismissed TropiFlora’s 2018
Petition challenging the denial of its request seeking MMTC
licensure, the company chose not to seek judicial review of that
final order. Thus, TropiFlora cannot use a declaratory judgment
action to collaterally attack those decisions now. See Hollywood
Lakes Section Civic Ass’n, Inc. v. City of Hollywood, 676 So. 2d 500,
501 (Fla. 4th DCA 1996) (“The ‘declaratory decree statute is no
substitute for established procedure for review of final judgments
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or decrees. Nor is it a device for collateral attack upon them.’”
(quoting deMarigny v. deMarigny, 43 So. 2d 442, 445 (Fla. 1949))).
In reaching our decision, we have not overlooked TropiFlora’s
argument that the Department had a non-discretionary duty to
score its application. We simply disagree. The rules and enabling
statute require a nursery to provide certified financial statements
before its application can be considered. Despite several
amendments, section 381.986 has always required an applicant to
provide financial statements as a condition of licensure. Compare
§ 381.986(5)(b)5., Fla. Stat. (2014), with § 381.986(8)(b)7., Fla.
Stat. (2021); and see Fla. Admin. Code R. 64-4.002(2)(f)1., (4)
(requiring an applicant to provide certified financials and warning
that incomplete applications will not be scored). The statute and
rules are in harmony, and they do not contemplate scoring or
approving an incomplete application. The Department gave
TropiFlora a chance to correct the deficiency in its application, but
TropiFlora failed to do so and reasserted its belief that MariJ’s
financial statements were sufficient. Thus, the Department
properly denied TropiFlora’s application for failing to provide the
required documentation.
D.
Finally, the trial court correctly concluded that it could not
compel the Department to score TropiFlora’s application under the
standards in effect in 2015. Even if a declaratory judgment action
could be used to collaterally attack the Department’s decision,
courts must apply the licensure law in effect when the licensing
decision is made, not the law in effect when the application is
submitted. Lavernia v. Dep’t of Pro. Regul., Bd. of Med., 616 So. 2d
53, 53–54 (Fla. 1st DCA 1993) (“Florida follows the general rule
that a change in a licensure statute that occurs during the
pendency of an application for licensure is operative as to the
application, so that the law as changed, rather than as it existed
at the time the application was filed, determines whether the
license should be granted.”).
All previous versions of section 381.986 were repealed in 2017.
See Oldham v. Rooks, 361 So. 2d 140, 143 (Fla. 1978) (“[W]hen the
legislature makes a complete revision of a subject, it serves as an
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implied repeal of earlier acts dealing with the same subject unless
an intent to the contrary is shown.”). The law now authorizes the
licensure of MMTCs, not DOs. TropiFlora’s 2015 application
addressed only the then-existing legal requirements for DO
licensure, not the current requirements for MMTC licensure.
TropiFlora seeks a DO license under a now-repealed law, and
no court or agency can grant the requested relief. See Ocampo v.
Dep’t of Health, 806 So. 2d 633, 634 (Fla. 1st DCA 2002) (“An
administrative agency is a creature of statute” and it “can only do
what it is authorized to do by the Legislature.”); Fla. Ass’n of
Rehab. Facilities, Inc. v. Dep’t of Health & Rehab. Servs., 526 F.3d
685, 690 (11th Cir. 2008) (affirming the dismissal of appellant’s
action for declaratory relief because it was rendered moot by the
repeal of the statute underlying the claim); see also Arick v.
McTague, 292 So. 2d 31, 32 (Fla. 1st DCA 1973) (holding that the
trial court reversibly erred by applying a statute that had been
repealed after the date of an accident but before the entry of
summary judgment).
AFFIRMED.
JAY and TANENBAUM, JJ., concur.
_____________________________
Not final until disposition of any timely and
authorized motion under Fla. R. App. P. 9.330 or
9.331.
_____________________________
Steven R. Andrews of the Law Office of Steven R. Andrews, P.A.,
Tallahassee; and Cynthia A. Myers of the Law Office of Cynthia A.
Myers, P.A., Tallahassee, for Appellant.
Eduardo S. Lombard and Angela D. Miles of the Radey Law Firm,
Tallahassee, for Appellee.
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