Care facility’s petition for judicial review barred by res judicata

A Merrillville nursing facility’s third petition seeking judicial review of the state Department of Health’s decision to deny a full license to the facility was barred by a previous petition for judicial review of the matter, the Indiana Court of Appeals ruled.

The Department of Health granted three probationary licenses during 2009 to Northlake Nursing and Rehabilitation Center LLC, but after repeatedly not being in compliance with health facility regulations, the health department denied issuing a full license to the facility. It then issued an emergency order for relocation of the residents.

Northlake initiated administrative appeals of these orders and then sought emergency relief by filing a petition for judicial review. However, before a final decision was made, Northlake’s counsel withdrew from the action and the trial court dismissed the petition with prejudice because the facility failed to appear at a Trial Rule 41(E) hearing. The administrative appeal of the notice of non-renewal of license continued, but the administrative law judge dismissed it. The trial court then, in a third petition for judicial review of the denial of the license renewal filed by Northlake, found that the action was barred by res judicata. A second petition for judicial review dealt only with the relocation order.

The Court of Appeals agreed in Northlake Nursing and Rehabilitation Center, L.L.C. d/b/a Northlake Nursing and Rehabilitation Center v. State of Indiana Department of Health, 49A02-1411-PL-813. Four factors must be present for res judicata to apply, and those factors are in play in this case. The judges found the former judgment was rendered by a court of competent jurisdiction; it was rendered on the merits; the matter now in issue was, or could have been, determined in the prior action; and the controversy adjudicated in the former action must have been between the parties to the present suit.