Senior Care Resources, Inc. v. OAC Senior Living, LLC Andrew Berry & Orson Berry
2014 Tex. App. LEXIS 2536
Tex. App.2014Background
- DADS administers Texas Medicaid and controls allocation of Medicaid-certified nursing facility beds, including by granting community needs waivers when additional beds are necessary.
- OAC (controlled by Andrew and Orson Berry) applied for a community needs waiver for 120 beds (later approved for 60); application included a demographic/quality study and support letters.
- Senior Care (operator of Royse City Health & Rehabilitation Center) opposed the waiver, submitted opposition letters to DADS, and claimed OAC’s submissions contained false statements about local facilities and occupancy/quality.
- DADS reviewed applicant materials, opposition submissions, and its own data, and granted OAC a waiver; DADS’s rules permit voiding waivers based on false information.
- Senior Care sued OAC and the Berrys for libel and business disparagement and sought a declaratory judgment that the waiver is void; the trial court granted summary judgment for defendants.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether statements to DADS are absolutely privileged (bar libel/disparagement) | Senior Care: communications to DADS are not quasi-judicial and thus not absolutely privileged; privilege inapplicable to informal permit-like process | Appellees: DADS’s waiver review is quasi-judicial; communications related to that proceeding are absolutely privileged | Court: DADS’s waiver review is quasi-judicial; communications to DADS are absolutely privileged — summary judgment affirmed on defamation/disparagement claims |
| Whether truth/other defenses preclude liability | Senior Care: statements were false; disputed issue of fact | Appellees: statements true and other defenses available | Court: Because absolute privilege bars the claims, court did not reach truth/other defenses (defendants prevailed on privilege) |
| Whether contributory negligence or failure to mitigate bars recovery | Senior Care: contributory negligence not a complete bar | Appellees: Senior Care’s conduct contributed to its alleged injury | Court: Not reached — resolved by absolute privilege ruling in favor of defendants |
| Whether trial court had jurisdiction to grant declaratory relief voiding DADS waiver | Senior Care: has right to a declaration that waiver is void because it was procured by false information; not directly challenging rule application | Appellees: Senior Care lacks justiciable interest; relief would require court to substitute judgment for DADS; APA requires suit against agency in Travis County | Court: APA applies; trial court lacked subject-matter jurisdiction over declaratory claim — that portion vacated and dismissed |
Key Cases Cited
- Reagan v. Guardian Life Ins. Co., 166 S.W.2d 909 (Tex. 1942) (defines absolute privilege and its scope)
- Hurlbut v. Gulf Atl. Life Ins. Co., 749 S.W.2d 762 (Tex. 1988) (absolute privilege is immunity tied to occasion, not motive)
- Perdue, Brackett, Flores, Utt & Burns v. Linebarger, Goggan, Blair, Sampson & Meeks, L.L.P., 291 S.W.3d 448 (Tex. App.—Fort Worth 2009) (two-part test for absolute privilege in quasi-judicial context)
- Bird v. W.C.W., 868 S.W.2d 767 (Tex. 1994) (absolute privilege bars claims that are essentially defamation damages)
- Eldercare Props., Inc. v. Tex. Dep’t of Human Servs., 63 S.W.3d 551 (Tex. App.—Austin 2001) (agency rulemaking and bed-allocation context)
- Texas Dep’t of Health v. Texas Health Enters., Inc., 871 S.W.2d 498 (Tex. App.—Dallas 1993) (distinguishes when court may enjoin agency actions rather than challenge rule application)
- Provident Life & Accident Ins. Co. v. Knott, 128 S.W.3d 211 (Tex. 2003) (appellate review of summary judgment without stated grounds)
- Rusk State Hosp. v. Black, 392 S.W.3d 88 (Tex. 2012) (subject-matter jurisdiction and immunity may be raised at any time)
- Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440 (Tex. 1993) (subject-matter jurisdiction is never presumed)