Court Opinion

ID: 4946727
Source: CourtListenerOpinion
Date Created: 2021-09-24 12:25:03.884906+00
Date Added: 2024-06-11T08:15:07.462400
License: Public Domain

VIOLETTE, Justice,
with whom NICHOLS, Justice, joins, dissenting.
I respectfully dissent. I do not agree that the “de-authorization” decision of the Director of the Bureau on July 17, 1980, is not reviewable agency action within the meaning of the Maine Administrative Procedure Act (APA). 5 M.R.S.A. § 11001(1) (1979). It is my opinion that the decision constituted final agency action entitling plaintiffs to judicial review.
The Superior Court, in dismissing plaintiffs’ action, said in pertinent part:
The action taken by the defendant on July 17,1980, is not “final agency action” as defined in 5 M.R.S.A. § 8002(4). While it is true that a plaintiff need not prove that the decision of the agency was adjudicatory in nature, see Brown v. State, Department of Manpower Affairs, Me., 426 A.2d 880, 883 (1981), he must show nonetheless that the action was “dispositive” and that “no further recourse” exists. See 5 M.R.S.A. 8002(4). Here, the plaintiff’s substantial rights remain undetermined and the agency has stated that it cannot at present work with the plaintiff. Thus, even though the letter of July 17,1980 could be considered an informal final determination, see 2 Am.Jur.2d Administrative Law § 585 (1962), the Court concludes that it is only a pronouncement of the defendant’s intention to cease working with the plaintiff until all differences are resolved. (Emphasis in original).
This Court affirms the trial court’s dismissal for lack of final agency action, but for a different reason. It grounds its decision on a finding that plaintiffs have failed to exhaust their administrative remedies. It is my judgment that both the trial court and this Court are wrong.
I.
The APA defines “final agency action” as “a decision by an agency which affects the legal rights, duties, or privileges of specific persons, which is dispositive of all issues, legal and factual, and for which no further *412recourse, appeal or review is provided within the agency.” 5 M.R.S.A. § 8002(4) (1979). “Final agency action” is not limited to strictly adjudicative proceedings, but includes all decisions affecting one’s legal rights, duties or privileges. Brown v. Department of Manpower Affairs, 426 A.2d 880, 883 (Me.1981); see Me.Leg.Doc. No. 1768, 108th Leg., 1st Sess., commentary to § 8002(4) (1977) (scope of judicial review exceeds adjudicatory proceedings). While the Court cautioned that, because of the constitutional doctrine of separation of powers, some executive actions are not reviewable by their very nature, Brown, 426 A.2d at 884, the agency action in this case is clearly not of the nature that would fall within such prohibition.
The facts of the case are important to the determination of this appeal. The Bureau letter of January 8, 1980, written by the Manager of the Community Resources Unit (CRU), officially authorized plaintiff NOE to be utilized as a facility by the Bureau for referrals of vocational rehabilitation clients. The rate of compensation was therein set. Because the Bureau believed NOE’s program did not meet its standards in five specific areas, the letter stated that continued authorization required NOE to submit a compliance timetable within three months. It further provided for the submission within six months of a timetable for compliance with an Affirmative Action Plan. Referrals by the Bureau to NOE then followed. On July 17, 1980, the Director of the Bureau informed NOE that it would no longer be authorized to provide referral service to Bureau clients.1 The letter cited difficulty in cooperation between NOE and the Bureau, and claimed that NOE did not share in case planning, did not issue progress reports, and did not comply with the condition of the January 8, 1980 authorization letter. The testimony of the Director of Field Operations indicated that the primary reason for the “deauthorization” was not the alleged failure to comply with the January 18,1980 letter but was the inability of NOE to establish a viable working relationship with the Bureau. The parties disagreed as to the proper rates for services. NOE charged the Bureau with unfairness. The Bureau charged NOE with not properly servicing clients. Notwithstanding these charges, it is clear that the deauthorization was not a direct result of a failure of NOE to meet the minimal Bureau standards for authorization.
II.
The Superior Court found no “final agency action” as defined in 5 M.R.S.A. § 8002(4). The court observed that the evidence neither indicated that defendant had formally declared NOE ineligible nor showed that the Bureau would never again refer clients to NOE. It found the “deau-thorization” letter to be a mere pronouncement of the Bureau’s intention to cease working with NOE until all differences were resolved. The court made no finding *413as to the propriety of the Bureau’s termination of its authorization to NOE.
I believe the trial court committed error in its determination of no “final agency action” and, therefore, erroneously dismissed plaintiffs’ complaint.
The complaint raised only one issue and only that issue was before the trial court. The complaint alleged that NOE, on January 8, 1980, was authorized or qualified to receive referrals from the Bureau; that on July 17, 1980, the Bureau rescinded that authorization, effective August 1, 1980; that such action was unwarranted, capricious, arbitrary and unreasonable; and prayed for relief.
It is my judgment that defendant’s decision on July 17, 1980, to deauthorize plaintiff to provide any services after August 1, 1980, effectively disposed of all issues, legal or factual, as required by the APA as a prerequisite for judicial review. 5 M.R.S.A. § 11001(1) (1979). Although the Bureau may decide at some future date to again authorize NOE to receive referrals, this possibility does not lessen NOE’s present injury from the loss of clients and thus income. The discretionary power of an agency to review and alter a decision does not render an otherwise final decision nonfinal. Motorola,, Inc. v. Illinois Fair Employment Practices Commission, 34 Ill.2d 266, 272, 215 N.E.2d 286, 288, 290 (1966); Seidner v. Town of Colonie, 79 A.D.2d 751, 752, 434 N.Y.S.2d 800, 801 (1980); see also Fidelity Television, Inc. v. F.C.C., 502 F.2d 443, 448 (D.C.Cir.1974) (principle of finality is governed by nature and effect of order, not by whether order is necessarily last in chain of administrative orders).
If the July 17,1980 letter to NOE did not constitute “final agency action,” it is difficult to envision an action the Bureau might take which would. Applying the rationale of the Superior Court, neither “reauthorization” nor a second “deauthorization” would give rise to the right of judicial review, regardless of the reasons for any of the Bureau’s actions. The cycle could go on ad infinitum, the plaintiffs never receiving judicial review.
The Illinois case of Pearce Hospital v. Illinois Public Aid Commission, 15 I11.2d 301, 154 N.E.2d 691 (1958) bears a striking similarity to this case. In Pearce, plaintiff, the owner of a private hospital that was on the lists of physicians and hospitals permitted to participate in the commission’s medical aid program, was informed by the commission that the average admission rate and length of stay at the hospital was well above the state average, and that the plaintiff should take corrective measures within six months. Unsatisfied with plaintiff’s effort to comply with the request, the defendant subsequently sent plaintiff a letter informing him that the state was dropping the hospital from its medical aid program rolls. Id. at 303, 154 N.E.2d at 693. The court found that although the decision was informal in nature, it was nonetheless a final disposition of plaintiff’s rights and privileges with respect to participation in the tax-supported medical program, and was sufficient to support an action for review under the Illinois Administrative Review Act. Id. at 306, 154 N.E.2d at 694. Similarly in this case, the Bureau’s letter of July 17, 1980, was a final disposition of NOE’s rights and privileges to participate in the Bureau’s rehabilitation program.
III.
The Court affirms the dismissal of plaintiffs’ action, on a finding that there was no final agency action, but for a reason totally different from that given by the Superior Court. It holds that plaintiffs have not exhausted their administrative remedies, an issue not raised at trial, and neither briefed nor argued. It is interesting to note that defendant, in its brief and at oral argument, agreed with plaintiffs that the July 17th letter of “deauthorization” constituted “final agency action.” Defendant’s argument to affirm the Superior Court dismissal is that, on the evidence presented to the trial court, defendant was entitled to an *414affirmance of the Bureau’s decision on the merits.
I consider the Court’s conclusion of failure to exhaust administrative remedies to be mistaken. I fully concur with the Court’s declaration that a party must exhaust his administrative remedies before he can turn to the courts for relief. But such is not the issue here.
Initially, it is important to note that the Rehabilitation Act, 22 M.R.S.A. §§ 3051-3067 (1980), provides for a fair hearing before the commissioner of human services and judicial review only for individuals applying for or receiving rehabilitation under the Act. Id. at § 3061. There are no provisions for hearings and judicial review for providers of facility services, such as NOE.
The Court grounds its determination of failure to exhaust administrative remedies on Step # 5, Facility Use Approval (set forth in part in the opinion) of the Bureau’s casework manual. I submit that this part of the regulation has no application to the case before the Court.
Step # 5 is a part of the Bureau’s casework manual, dated June, 1979, entitled “Procedure for Initiating BR Use of Rehabilitation Facility Services.” After setting down five criteria for determining approval of a rehabilitation facility for VR use, the procedure sets forth six steps, entitled as follows:
Step # 1 — Identification of Need for Facility Services
Step # 2 — Verification of Facility’s Intent to Provide VR Services
Step # 3 — Analysis of Facility Data Pri- or to On-Site Visit
Step # 4 — On-Site Facility Visit
Step # 5 — Facility Use Approval
Step # 6 — Facility Monitoring
It is readily apparent from reading all the steps, and particularly Step # 5, that the appeal to the Director relied upon by the Court applies only to the approval of the facility and not to a deauthorization of approval, which is the case before the Court. Step # 5(A) states that “[t]he Manager of CRU, with consultation from the BR Regional Director, shall decide whether or not to approve BR use of each of the programs or services which the facility offers.” The appeal to the Director provided in Step # 5(C) refers directly to a disagreement on any of the three categories contained at Step # 5(B), none of which is involved here. In short, Step # 5(C) provides no appeal or hearing to the Director or to anyone else within the agency from a “deauthorization” decision.
Step # 6 — Facility Monitoring, is the only part of the regulation which addresses the discontinuance of the approved use of the facility (deauthorization).2 Subsection
(B) of Step # 6 sets forth the procedure the Manager of the CRU will follow once he has held the meeting set forth in subsection (A), in reporting his decision to continue or discontinue the approved use of the facility. Step # 6 makes no provision for any appeal or hearing from a decision to discontinue authorized use of a facility.
While it can be argued that, if the Manager of CRU decided to continue the approved use of a facility under Step # 6(B) but set conditions for the continued use, the facility could appeal the decision to the Bureau Director under Step # 5(B)(3) & (C), no argument can be made that Step *415# 5 provides a facility, either specifically or by inference, with an appeal to the Director from a decision to discontinue approval of the use of a facility. Further, no appeal or hearing is authorized by any other Bureau rule or regulation.
It seems to me eminently clear that plaintiffs are provided with no further recourse, appeal or review within the agency from the deauthorization decision of the Bureau. Thus, they have exhausted all their administrative remedies; in fact, they have none to exhaust. Additionally, where as in this case, there are no provisions for hearing before the agency and, therefore, no opportunity to make a record, section 11006 of the APA provides for the taking of the necessary evidence by the reviewing court. This appears to be what the trial court did here, but it failed to decide the case.
I would accordingly vacate the judgment of the Superior Court and remand for further proceedings consistent with this opinion.

. The letter stated in pertinent part:
July 17, 1980
Charles O. Tingley, Jr., Ph.D.
Northeast Occupational Exchange
183 Harlow Street
Bangor, Maine 04401
Dear Doctor Tingley:
This is to advise you that, after August 1, 1980, Maine’s Bureau of Rehabilitation will no longer authorize your agency to provide any services to our clients. We will be making alternative arrangements for the clients who are needful of this range of service. We have made every effort to work cooperatively with you on behalf of clients, but we have not been able to do so and we continue not to share in case planning for our clients, to receive progress reports, or to know of their strengths and weaknesses upon discharge. We have repeatedly requested that you adhere to the requirements set forth in the January 8, 1980 letter from Richard Tripp, Manager of the Community Resources Unit; but, to date, you have not provided us with the materials needed.
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We sincerely regret that we have been unable to resolve those differences in our philosophy and practice which have created barriers to communication for our staff and hardships for our clients.
Sincerely,
C. Owen Pollard
Director, Bureau of Rehabilitation

. Step # 6 — Facility Monitoring provides in pertinent part:
A. Within one year of the decision to utilize the facility’s services on behalf of BR clients and applicants, the Manager of CRU will convene a meeting of himself, the appropriate BR Regional Director(s), and the facility representative in order to determine the appropriateness of continued use of the facility.
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B. The Manager of CRU will, within one month of this meeting, forward a written report to the appropriate BR Regional Director(s) and the facility representative. This report will indicate:
1. The decision of the Manager of CRU to continue or discontinue the approved use of the facility.
2. The basis for this decision.
3. Any requirements or recommendations for continued use of the facility.