Sunset Cay v. SCDHEC

THIS OPINION HAS NO PRECEDENTIAL VALUE. IT SHOULD NOT BE
CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING
EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Sunset Cay, LLC, Appellant,

v.

South Carolina Department of Health and Environmental
Control, Respondent.

Appellate Case No. 2017-000161

Appeal From The Administrative Law Court
John D. McLeod, Administrative Law Judge

Unpublished Opinion No. 2020-UP-030
Submitted May 8, 2019 – Filed January 29, 2020

AFFIRMED

Thomas R. Goldstein, of Belk, Cobb, Infinger &
Goldstein, P.A., of Charleston, for Appellant.

General Counsel Bradley David Churdar, of S.C.
Department of Health and Environmental Control, of
Charleston, for Respondent.

PER CURIAM: Sunset Cay, LLC appeals the Administrative Law Court's (ALC)
dismissal of its claims against the South Carolina Department of Health and
Environmental Control (DHEC), arguing the ALC erred in (1) dismissing its
request for the ALC to review the declaration issued by DHEC (the Declaration)
on the ground that the appeal was premature and (2) dismissing with prejudice
Sunset Cay's appeal. We affirm.

1. We find the ALC properly dismissed Sunset Cay's request for it to review
the Declaration because the ALC did not have subject matter jurisdiction over
Sunset Cay's claim. See Original Blue Ribbon Taxi Corp. v. S.C. Dep't of Motor
Vehicles, 380 S.C. 600, 604, 670 S.E.2d 674, 676 (Ct. App. 2008) ("In an appeal
from the decision of an administrative agency, the Administrative Procedures Act
[(APA)] provides the appropriate standard of review."); Amisub of S.C., Inc. v. S.C.
Dep't of Health and Envtl. Control, 403 S.C. 576, 585, 743 S.E.2d 786, 791 (2013)
("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."); S.C. Code Ann. § 1-23-500 (Supp. 2019) (creating the ALC); S.C. Dep't
of Consumer Affairs v. Foreclosure Specialists, 390 S.C. 182, 186, 700 S.E.2d 468,
470 (Ct. App. 2010) (observing the ALC does not have the authority to exceed its
statutorily granted powers); Berry v. S.C. Dep't of Health and Envtl. Control, 402
S.C. 358, 364, 742 S.E.2d 2, 5 (2013) ("Under the APA, persons aggrieved by an
agency decision are entitled to seek review of the decision by means of a contested
case hearing before the ALC."); Amisub, 403 S.C. at 585, 743 S.E.2d at 791 ("By
statute, the General Assembly has authorized the ALC to preside over 'contested
case' proceedings." (citing S.C. Code Ann. § 1-23-600(A) (Supp. 2019))); S.C.
Code Ann. § 44-1-60(G) (2018) (allowing applicants, permittees, licensees, or
affected persons to file a request for a contested case hearing with the ALC in
accordance with the statute); S.C. Code Ann. § 1-23-505(3) (Supp. 2019)
("'Contested case' means a proceeding including, but not restricted to, ratemaking,
price fixing, and licensing, in which the legal rights, duties, or privileges of a party
are required by law or by Article I, Section 22, Constitution of the State of South
Carolina, 1895, to be determined by an agency or the [ALC] after an opportunity
for hearing." (emphasis added)); S.C. Const. art. I, § 22 ("No person shall be
finally bound by a judicial or quasi-judicial decision of an administrative agency
affecting private rights except on due notice and an opportunity to be heard; nor
shall he be subject to the same person for both prosecution and adjudication; nor
shall he be deprived of liberty or property unless by a mode of procedure
prescribed by the General Assembly, and he shall have in all such instances the
right to judicial review." (emphasis added)); S.C. Dep't of Revenue v. Club Rio,
392 S.C. 636, 642, 709 S.E.2d 690, 694 (Ct. App. 2011) ("The statutory scheme
confers on the ALC subject matter jurisdiction over [DHEC's] contested cases.");
S.C. Code Ann. Regs. 30-9(D) (2011) ("Interested persons may petition to [DHEC]
for declaratory rulings.").
Neither the South Carolina Code nor the South Carolina Code of Regulations
provide a manner in which an interested party may appeal a declaration issued by
DHEC, and Sunset Cay conceded it has not obtained a final decision in a contested
case. See Foreclosure Specialists, 390 S.C. at 186, 700 S.E.2d at 470 (observing
the ALC does not have the authority to exceed its statutorily granted powers);
Amisub, 403 S.C. at 585, 743 S.E.2d at 791 ("By statute, the General Assembly has
authorized the ALC to preside over 'contested case' proceedings." (citing
§ 1-23-600(A))). Furthermore, although DHEC's response to the Declaration
indicated Sunset Cay's proposed uses were not water-dependent, Sunset Cay still
has the opportunity to apply for an amendment to its permit. Thus, Sunset Cay is
not finally bound by the Declaration such that its private rights are affected. If
DHEC were to deny any application for an amendment submitted by Sunset Cay,
Sunset Cay would then be able to pursue a contested case by following the
procedures set forth in section 44-1-60. See S.C. Const. art. I, § 22 ("No person
shall be finally bound by a judicial or quasi-judicial decision of an administrative
agency affecting private rights except on due notice and an opportunity to be heard
. . . ." (emphasis added)). Therefore, we find the ALC did not err in dismissing
Sunset Cay's request for it to review the Declaration for lack of subject matter
jurisdiction.
2. We find the ALC properly dismissed Sunset Cay's appeal of a cease and desist
directive (the Directive) sent to Sunset Cay by DHEC's Office of Ocean and
Coastal Management with prejudice because Sunset Cay failed to exhaust
administrative remedies and an amendment to Sunset Cay's complaint would be
futile. See Stiles v. Ontario, 318 S.C. 297, 300, 457 S.E.2d 601, 602 (1995) ("The
ruling on a Rule 12(b)(6)[, SCRCP,] motion to dismiss must be based solely upon
the allegations set forth on the face of the complaint."); id. at 300, 457 S.E.2d at
602–03 ("A Rule 12(b)(6) motion may not be sustained if facts alleged and
inferences reasonably deducible therefrom would entitle the plaintiff to any relief
on any theory of the case."); Spence v. Spence, 368 S.C. 106, 129, 628 S.E.2d 869,
881 (2006) ("When a complaint is dismissed under Rule 12(b)(6) for failure to
state facts sufficient to constitute a cause of action, the dismissal generally is
without prejudice."); id. ("The plaintiff in most cases should be given an
opportunity to file and serve an amended complaint."); id. ("[A] complaint is not
subject to dismissal with prejudice unless it appears to a certainty that no relief can
be granted under any set of facts that can be proved in support of its allegations."
(citing Giuliani v. Chuck, 620 P.2d 733, 737 (Haw. Ct. App. 1980))); Skydive
Myrtle Beach, Inc. v. Horry County, 426 S.C. 175, 190, 826 S.E.2d 585, 593
(2019) (indicating that Spence found "an appellate court must find the dismissal
was without prejudice and remand for the filing of an amended complaint unless
the court concludes any amendment would be clearly futile" (citing Spence, 368
S.C. at 130, 628 S.E.2d at 881–82)); Berry, 402 S.C. at 364, 742 S.E.2d at 5
("Under the APA, persons aggrieved by an agency decision are entitled to seek
review of the decision by means of a contested case hearing before the ALC."); id.
("The ALC sits as the adjudicatory body in all contested cases involving DHEC.");
§ 1-23-600(A) ("An administrative law judge shall preside over all hearings of
contested cases . . . ."); Hyde v. S.C. Dep't. of Mental Health, 314 S.C. 207, 208,
442 S.E.2d 582, 582–83 (1994) ("Whether administrative remedies must be
exhausted is a matter within the [ALC's] sound discretion and [its] decision will
not be disturbed on appeal absent an abuse thereof."); id. at 208, 442 S.E.2d at 583
("The general rule is that administrative remedies must be exhausted absent
circumstances supporting an exception to application of the general rule."); S.C.
Code Ann. § 44-1-60(C) (2018) ("The initial decision involving the issuance,
denial, renewal, suspension, or revocation of permits, licenses, or other action of
the department shall be a staff decision."); S.C. Code Ann. § 44-1-60(E)(2) (2018)
("[A] staff decision becomes a final agency decision fifteen calendar days after
notice of the staff decision has been mailed to the applicant, unless a written
request for final review accompanied by a filing fee is filed with [DHEC] by the
applicant, permittee, licensee, or affected person." (emphasis added));
§ 44-1-60(G) ("An applicant, permittee, licensee, or affected person may file a
request with the [ALC] for a contested case hearing within thirty calendar days
after: (1) notice is mailed to the applicant, permittee, licensee, and affected persons
that the board declined to hold a final review conference; or (2) the sixty calendar
day deadline to hold the final review conference lapses and no conference has been
held; or (3) the final agency decision resulting from the final review conference is
received by the parties." (emphasis added)).

AFFIRMED. 1

WILLIAMS, GEATHERS, and HILL, JJ., concur.

1
We decide this case without oral argument pursuant to Rule 215, SCACR.