THE STATE OF SOUTH CAROLINA

In The Court of Appeals

Trident Medical Center, LLC, d/b/a Trident Medical 

Center, Respondent,

v.

South Carolina Department of Health and Environmental 

Control and Medical University Hospital Authority d/b/a 

MUSC Radiation Therapy Center - Berkeley County, 

Respondents,

Of Which, Medical University Hospital Authority d/b/a 

MUSC Radiation Therapy Center - Berkeley County is 

the Appellant.

Appellate Case No. 2019-001159

Appeal From The Administrative Law Court

Harold W. Funderburk, Jr., Administrative Law Judge

Opinion No. 5956

Heard October 5, 2022 – Filed December 14, 2022

REVERSED

Daniel J. Westbrook, William C. Wood, Jr., Travis 

Dayhuff, and Allen Mattison Bogan, all of Nelson 

Mullins Riley & Scarborough, LLP, of Columbia, for 

Appellant.

David Beam Summer, Jr., and William R. Thomas, both 

of Parker Poe Adams & Bernstein, LLP, of Columbia, for 

Respondent Trident Medical Center, LLC.
Ashley Caroline Biggers and Vito Michael Wicevic, both

of Columbia, for Respondent South Carolina Department 

of Health & Environmental Control.

Robert L. Widener, Celeste T. Jones, and Jane W. 

Trinkley, all of Burr & Forman, of Columbia, for Amici 

Curiae Medical University of South Carolina and MUSC 

Strategic Ventures.

THOMAS, J: Trident Medical Center, LLC, d/b/a Trident Medical Center 

(Trident), filed this action in the Administrative Law Court (ALC) against the 

South Carolina Department of Health and Environmental Control (DHEC) and 

Medical University Hospital Authority, d/b/a MUSC Radiation Therapy Center –

Berkeley County (MUHA). The action contested DHEC's approval of MUHA's 

Certificate of Need (CON) application for a new radiation therapy center in 

Berkeley County. After a contested case hearing, the ALC reversed DHEC's 

approval and denied the application. MUHA appeals, arguing, inter alia, the ALC 

erred in exceeding its statutory authority by ruling on the validity and 

constitutionality of MUSC Strategic Ventures (MSV) and MUSC Health Center 

Cancer Care Network, LLC (the Network) when DHEC had neither considered nor 

addressed the issues. We reverse.

FACTS

In May of 2017, MUHA filed a CON application requesting approval of a radiation 

therapy center in Berkeley County. MUHA was identified as the licensee, and the 

Network1 was identified as the management company. The CON application 

identified the owners as follows: Alliance2 "is the majority owner of [the 

Network] with a 51% membership interest. [MSV] is the minority owner . . . with 

a 49% membership interest." The application proposed to "increase the capacity of 

MUSC Health's radiation therapy by adding a sixth linear accelerator." By letter 

dated June 7, 2017, Trident notified DHEC it was an affected person with respect 

to MUHA's application, and it opposed the approval of the application. On 

November 22, 2017, DHEC granted the CON to MUHA. DHEC's findings 

 

1 The Network was formed in January 2016, is authorized to do business in SC, 

and is owned 51% by Alliance Oncology, LLC, and 49% by MSV. 2 A for-profit Delaware company headquartered in California.
indicate it considered the South Carolina Health Plan and the various regulations 

regarding community need, medically underserved groups, and financial 

feasibility. There is no indication DHEC considered the validity and/or the 

constitutionality of MSV or the Network.3

 The DHEC Board declined Trident's 

request for a review. 

Trident filed a petition for a contested case with the ALC, arguing DHEC's 

decision to grant the application was arbitrary, capricious, and affected by other 

error of law or fact. In its opening statement at the contested hearing before the 

ALC, Trident also argued the proposed project did not comply with the South 

Carolina Health Plan; MUHA did not meet the requirements of community need, 

medically underserved groups, and accessibility; the project did not meet the 

financial feasibility requirements; and Trident would be adversely impacted by the 

project. DHEC opened, arguing in part that although the hearing before the ALC 

was de novo, the ALC could not consider issues not raised to or considered by the 

agency.

Trident offered numerous witnesses in support of its position during the five-dayslong hearing. DHEC called one witness, Margaret Murdock, the DHEC attorney 

who reviewed the MUHA application. Murdock was asked if DHEC was 

concerned "that a company called Alliance [was]" the manager of the project rather 

than MUHA. MUHA objected on several grounds, including that the issue was not 

raised to DHEC. Counsel for Trident stated, "Thankfully it was in the CON 

application, so we know that it was considered." When asked what she knew about 

the entity Alliance, Murdock answered, "I don't recall specifically sitting here 

today." 

At the end of all testimony, Trident argued it was entitled to judgment as a matter 

of law. Trident argued DHEC was not aware of the ownership of the joint venture. 

Trident acknowledged the operating agreement explaining the ownership was not 

before DHEC, asserting it was not revealed until discovery for the ALC hearing. 

Trident argued the ownership structure violated the statutory mandates governing 

MUSC. The ALC accepted Trident's written motion and adjourned to give MUHA 

time to respond.

 

3 DHEC acknowledges in its brief that nothing in the CON Act, Regulations, or 

South Carolina Health Plan authorizes it to rule on the constitutionality of a legal 

entity listed in a CON application.
The ALC granted Trident judgment as a matter of law. The ALC found "[d]espite

the fact that The Network or Alliance is clearly funding the project . . . , the 

Application identifies The Network as only the management company engaged by 

the licensee to manage or operate the facility." The ALC found that although the 

application provided various answers regarding the ownership and/or control of the 

facility, the "answers provide[d] a somewhat murky picture of the overall 

organizational structure of the proposed project" and DHEC was not aware of the 

ownership until the ALC hearing. The ALC found neither MUSC nor MUHA had 

the authority to create a joint venture with a private, for-profit company. The ALC 

concluded MUSC violated the constitutional prohibition against joint ownership 

and the Network was an unconstitutional and, therefore, an illegal or ultra vires

entity. Finally, the ALC found Alliance, rather than MUHA, was the actual 

licensee of the proposed project; thus, the CON previously issued was void.

Accordingly, the ALC denied the CON for MUHA's proposed project. The ALC 

summarily denied MUHA's motion to reconsider. This appeal followed. 

STANDARD OF REVIEW

"The ALC presides over the hearing of a contested case from DHEC's decision on 

a CON application and serves as the finder of fact." Spartanburg Reg'l Med. Ctr. 

v. Oncology & Hematology Assocs. of S.C., LLC, 387 S.C. 79, 89, 690 S.E.2d 783, 

788 (2010). In reviewing the appeal of a contested CON case, the Administrative 

Procedures Act (APA) establishes the standard of review. See id. at 89–90, 690 

S.E.2d at 788–89 (applying the APA to the appeal of a contested case from 

DHEC's decision on a CON application). 

The APA provides that an appellate court 

may affirm the decision or remand the case for further 

proceedings; or, it may reverse or modify the decision if 

the substantive rights of the petitioner have been 

prejudiced because the finding, conclusion, or decision 

is:

(a) in violation of constitutional or statutory provisions;

(b) in excess of the statutory authority of the agency;

(c) made upon unlawful procedure;

(d) affected by other error of law;
(e) clearly erroneous in view of the reliable, probative, 

and substantial evidence on the whole record; or

(f) arbitrary or capricious or characterized by abuse of 

discretion or clearly unwarranted exercise of discretion.

S.C. Code Ann. § 1-23-610(B) (Supp. 2022). 

LAW/ANALYSIS

MUHA and DHEC argue the ALC erred in ruling on the validity and 

constitutionality of MSV and the Network because (1) such a ruling exceeded the 

statutory authority of the ALC and (2) the issues were not presented to or 

considered by DHEC. We agree. 

A. Statutory Authority

We first find the ALC did not have the statutory authority to rule on the 

constitutionality of MSV and the Network. The General Assembly created the 

ALC as "an agency and a court of record within the executive branch of the 

government of this State." S.C. Code Ann. § 1-23-500 (Supp. 2022). "The 

General Assembly has the authority to limit the subject matter jurisdiction of a 

court it has created; therefore, it can prescribe the parameters of the ALC's

powers." Amisub of S.C., Inc. v. S.C. Dep't of Health & Envtl. Control, 403 S.C. 

576, 585, 743 S.E.2d 786, 791 (2013). "An administrative agency has only such 

powers as have been conferred upon it by law and must act within the granted 

authority for an authorized purpose. It may not validly act in excess of its powers . 

. . ." S.C. Tax Comm'n v. S.C. Tax Bd. of Rev., 278 S.C. 556, 560, 299 S.E.2d 489, 

491 (1983) (quoting 2 Am. Jur. 2d, Admin. Law, § 188, at 21); see generally

Travelscape, LLC v. S.C. Dep't of Revenue, 391 S.C. 89, 108, 705 S.E.2d 28, 38 

(2011) ("It is well settled in this State that ALCs, as part of the executive branch, 

are without power to pass on the constitutional validity of a statute or regulation."). 

MUHA relies on SGM-Moonglo, Inc. v. South Carolina Department of Revenue, 

378 S.C. 293, 662 S.E.2d 487 (Ct. App. 2008). In SGM-Moonglo, this court 

reviewed the ALC's approval of an off-premises beer and wine permit. 378 S.C. at 

294, 662 S.E.2d at 488. "The ALC held it did not have jurisdiction to enforce a 

restrictive covenant because its jurisdiction was limited to whether a proposed 

location meets the criteria established by statute and case law." Id. This court 

stated:
An administrative agency has only the powers conferred 

on it by law and must act within the authority created for 

that purpose. Pursuant to [the] . . . South Carolina 

Code[,] . . . the ALC must determine whether a proposed 

location is proper and suitable prior to granting an offpremises beer and wine permit. Restrictions in the chain 

of title of a proposed location, however, are not a 

legitimate concern of the ALC in determining whether 

the location is suitable. Accordingly, the ALC did not err 

in refusing to consider the existence of the restrictive 

covenant.

Id. at 295, 662 S.E.2d at 488 (internal footnotes omitted); see Be Mi, Inc. v. S.C. 

Dep't of Revenue, 408 S.C. 290, 299, 758 S.E.2d 737, 741–42 (Ct. App. 2014) 

(finding the ALC could not resolve the issue of compliance with a master deed in a 

contested liquor license case because such an issue had to be resolved by the 

circuit court). Trident argues SGM-Moonglo is distinguishable because the issue in 

SGM-Moonglo concerned an unrelated private contract right, whereas in this case, 

the purpose of the CON Act, to "guide the establishment of health facilities and 

services which will best serve public needs," is at issue. See S.C. Code Ann. § 44-

7-120 (2018).

However, we find nothing in the CON Act authorizes the ALC to rule on the 

constitutionality of a legal entity listed in a CON application. See MRI at Belfair, 

LLC v. S.C. Dep't of Health & Env't Control, 392 S.C. 314, 319, 709 S.E.2d 626, 

628–29 (2011) ("The express purposes of the CON Act are 'to promote cost 

containment, prevent unnecessary duplication of health care facilities and services, 

guide the establishment of health facilities and services which will best serve 

public needs, and ensure that high quality services are provided in health facilities 

in this State." (quoting S.C. Code Ann. § 44-7-120 (2002))). DHEC must deny a 

Certificate of Need if an application does not comply with the South Carolina

Health Plan. S.C. Code Ann. § 44-7-210(B) (2018). Under the applicable South 

Carolina Health Plan, the project review criteria included compliance with the need 

standards, community need documentation, accessibility, projected revenues, 

projected expenses, financial feasibility, and cost containment. Like the court in 
SGM-Moonglo, we find the ALC's jurisdiction was limited to whether the 

application met the criteria established by the governing law.4

B. Contested Cases Before the ALC

We also find the ALC erred in ruling on an issue not presented to or considered by 

DHEC.

A party in a contested case regarding an agency decision is required to file a notice 

including "the legal authority and jurisdiction under which the hearing is to be 

held; . . . reference to the particular sections of the statutes and rules involved; [and 

a] . . . short and plain statement of the matters asserted." S.C. Code Ann. § 1-23-

320 (B) (Supp. 2022). The ALC has the authority to hear contested cases and is 

allowed to conduct de novo hearings. S.C. Code Ann. §§ 1-23-380, -505(3), & -

600 (Supp. 2022). Although the ALC conducts de novo hearings, under the CON 

Act, "[t]he issues considered at the contested case hearing considering a 

Certificate of Need are limited to those presented or considered during the staff 

review." S.C. Code Ann. § 44-7-210(E) (2018) (emphasis added); see SCALC 

Rule 21(B) ("Discovery in Certificate of Need (CON) contested cases is limited to 

the issues presented or considered during the staff review.") (emphasis added).

"Findings of fact must be based exclusively on the evidence and on matters 

officially noticed." S.C. Code Ann. § 1-23-320(I) (Supp. 2022) (emphasis added).

DHEC reviews an application to determine compliance "with the South Carolina 

Health Plan, Project Review Criteria, and other regulations." § 44-7-210(B). 

DHEC's review includes, but is not limited to "the application, comments from 

affected persons . . . concerning the application, data, studies, literature and other 

information available to the Department . . . ." S.C. Code Ann. Regs. 61-15 § 308 

(Supp. 2022). The regulations require the "Name and address of licensee or 

prospective licensee[, who is] . . . defined as the legal entity who, or whose 

governing body, has the ultimate responsibility and authority for the conduct of the 

facility or service; the owner of the business." S.C. Code Ann. Regs. 61-15 § 

202(2)(b)(8)(b) (Supp. 2022).

 

4 DHEC acknowledges in its brief that nothing in the CON Act, governing 

regulations, or South Carolina Health Plan authorizes it to rule on the 

constitutionality of a legal entity listed in a CON application. 
We find the issues of the constitutionality and validity of MSV and the Network 

were neither raised by Trident in its request for final review to DHEC nor 

presented to or considered by DHEC during its staff review. See S.C. Code Ann. § 

44-7-210(E) (2018) (stating the ALC's review under the CON Act is limited to 

issues "presented or considered during the staff review"); § 44-7-210(C) (stating "a 

person may not file a request for final review in opposition to the staff decision on 

a Certificate of Need unless the person provided written notice to the department 

during the staff review that he is an affected person and specifically states his 

opposition to the application under review" (emphasis added)). On this matter, we 

find the ALC's reliance on Marlboro Park Hospital v. South Carolina Department 

of Health & Environmental Control, 358 S.C. 573, 595 S.E.2d 851 (Ct. App. 2004) 

is misplaced. The ALC correctly read the holding in Marlboro Park, interpreting 

section 44-7-210(E) as limiting a contested case hearing to the issues presented or 

considered by DHEC, but permitting evidence to be presented that was not 

presented to DHEC. 358 S.C. at 579, 595 S.E.2d at 854. However, the ALC did 

more than merely allow evidence to be heard that was not before DHEC by ruling 

on the legality and constitutionality of MSV and the Network where the ownership 

issue was not presented to or considered by DHEC. 

CONCLUSION

For the foregoing reasons, the ALC's order is

REVERSED.

HILL, J., and LOCKEMY, A.J., concur.