Boca Raton Mausoleum, Inc. v. STATE, DEPT. OF BANKING AND FINANCE

Citations: 511 So. 2d 1060; 12 Fla. L. Weekly 2020Docket: BN-466

Court: District Court of Appeal of Florida; August 18, 1987; Florida; State Appellate Court

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In the case of Boca Raton Mausoleum, Inc. et al. v. State of Florida, Department of Banking and Finance, the appellants sought a formal hearing under Section 120.57(1) of the Florida Statutes to challenge the issuance of a cemetery operating license to Memorial Park of Boca Raton, Inc. The Department had previously dismissed the appellants' petition for lack of standing, concluding that they did not adequately allege facts demonstrating a substantial interest or injury related to the agency action.

The appellants include Boca Raton Mausoleum, which claims potential reduced sales impacting its perpetual care fund, the College of Boca Raton, concerned about traffic and the educational atmosphere, two couples who purchased burial services from Mausoleum, and R. Brady Osborne, a local taxpayer expressing emotional distress over potential financial impacts on Mausoleum. 

The Department adopted the hearing officer's recommendation to dismiss, stating the petitioners failed to identify any legal basis for standing or demonstrate an injury in fact. On appeal, the appellants argue they have a substantial interest in the outcome of the proceedings and should be allowed to participate under the Department's rules. The case cites Agrico Chemical Company v. Department of Environmental Regulation, which defines a "party" in administrative proceedings and emphasizes the necessity of a substantial interest being affected by agency actions.

An individual or entity must demonstrate a substantial interest in a legal proceeding by proving two key elements: 1) an injury-in-fact that is sufficiently immediate to warrant a hearing under section 120.57, and 2) that the injury is of a type that the relevant proceedings, specifically The Florida Cemetery Act, aim to protect. In this case, Boca Raton Mausoleum, Inc. claims it will face economic harm due to reduced sales of burial spaces if a competing cemetery is permitted, which would diminish its perpetual fund. The hearing officer and Department found this claim speculative, but the court disagreed, emphasizing that the agency action itself would directly result in the alleged injury without dependence on intervening factors, unlike past cases where injuries were contingent on third-party actions. The court also noted that while normally a party must prove injury-in-fact, it would not require a fact-finding proceeding due to the appellant's alternative grounds for participation. Lastly, the court concluded that the economic injury claimed by Mausoleum falls within the interests that The Cemetery Act seeks to protect.

In Florida, third-party claims of standing in licensing or permitting proceedings based solely on economic interest are insufficient unless explicitly allowed by the relevant statute. This principle is supported by case law, including *Florida Medical Association v. Department of Professional Regulation* and *Florida Medical Center v. Department of Health and Rehabilitative Services*. The Florida Cemetery Act acknowledges the potential economic harm to purchasers of preneed burial rights if funds are mismanaged, emphasizing the necessity for regulation to protect public welfare while maintaining competitive market conditions. The Act's provisions indicate that the impact of a new licensee on existing cemetery sales and funds falls within its regulatory scope, particularly if the new operation overlaps with existing facilities. Unlike the licensing statute in *Shared Services, Inc. v. Department of Health and Rehabilitative Services*, which mandated a ministerial issuance of licenses without considering economic injury, the Cemetery Act grants the Department evaluative authority, requiring it to assess economic impacts. The interests surrounding the Cemetery Act differ significantly from those in health care certificate of need processes, which focus on cost containment, a concern not applicable to cemetery regulations.

Appellant Mausoleum seeks to participate in Memorial Park's permitting process based on the assertion that the Department's rules grant such a right. Under Florida Statutes Section 120.52(11)(b, c), agency rules can, in certain circumstances, create participation rights. The court reference to Florida Medical Center clarifies that while an agency rule cannot limit standing to only those who are substantially interested parties, it can define who has party status consistent with regulatory purposes. In Gadsden State Bank, the court recognized the standing of a competitor bank with a substantial interest, but it did not imply that any party filing a protest automatically gains standing. The Mausoleum is found to have a right to participate due to its alleged injury being within the protections of The Cemetery Act. Conversely, The College of Boca Raton cannot claim standing as its concerns regarding traffic congestion and educational environment do not align with the injuries the Act protects. The dismissal of The College's participation was thus deemed appropriate. The Miners and Pfaffs, who purchased crypts from Mausoleum, also allege competitive injury similar to Mausoleum's, which falls within the regulatory purpose, allowing them to participate. The Department’s rules facilitate participation for those filing protests, and a lack of immediate injury does not negate standing. However, Brady Osborne, a local taxpayer, does not qualify for participation merely due to community concerns regarding the cemetery, which is a matter for local zoning authorities.

Participation in proceedings related to the regulatory statutory purpose of The Act does not extend to individuals sharing general community concerns. The Department's rules do not confer a right of participation for such parties. The court found the appellants' other arguments unmeritorious, leading to a partial reversal and affirmation of the appealed order, with a remand for further proceedings. The Mausoleum, while exempt from licensing requirements, has established a perpetual fund for maintenance, which is not legally mandated but deemed relevant to its claim of injury-in-fact regarding the impact of a new facility on its operations. The Florida Administrative Code outlines criteria for licensing new cemeteries, emphasizing a need-based assessment that considers the availability of burial spaces in existing facilities. The rules cited by appellants do not challenge existing regulations but rather define the limits of standing within the regulatory purpose. Importantly, "substantial interest" may not always align with the regulatory statutory purpose, though it will always fall within it.