United States v. First Georgia Bank, Civ. A. No. C81-846A.
Decision Date | 04 January 1982 |
Docket Number | Civ. A. No. C81-846A. |
Parties | UNITED STATES of America, Plaintiff, v. FIRST GEORGIA BANK and Beverly Enterprises, Inc., Defendants. |
Court | U.S. District Court — Northern District of Georgia |
Barbara A. Harris, Asst. U. S. Atty., F. Richard Waitsman, Asst. Reg. Atty., U. S. Dept. of HHS, Atlanta, Ga., for plaintiff.
Herbert D. Shellhouse, Troutman, Sanders, Lockerman & Ashmore, Atlanta, Ga., for defendants.
The United States brings this action, under the "Hill-Burton Act," 42 U.S.C. § 291, et seq., (the Act),1 to recover a portion of the value of a nursing home built with Federal funds provided pursuant to the Act. Plaintiff contends that some $250,000.00 of Hill-Burton monies were granted for construction of a nursing home owned by Georgian Villa, Inc. Allegedly, this facility was transferred to defendant, First Georgia Bank, and subsequently to defendant, Beverly Enterprises, Inc. The case is now before the Court on defendants' motion to dismiss without prejudice or in the alternative for a stay.
Plaintiff's action as well as defendants' motion call for the Court's interpretation of 42 U.S.C. § 291i which reads as follows:
Defendants assert that this action is premature because the Secretary has not determined, pursuant to subsection 291i(b), whether to release defendants of their liability for good cause shown. The Court finds, as discussed below, that this action is properly before the Court and DENIES defendants' motion to dismiss or alternatively for a stay.
The Court finds that the statutory provision for waiver of liability in 42 U.S.C. § 291i(b) applies only to liability founded upon 42 U.S.C. 291i(b). The Government here seeks return of these monies pursuant to 42 U.S.C. § 291i(a) for the transfer of the said nursing home to entities which are not qualified to file an application as provided under subsection 291i(a). The statute unambiguously places the waiver provision in subsection (b) and this subsection makes no reference to liability based on subsection (a). Defendants argue that a secretarial waiver applies to both subsections because subsection (b)'s reference to the waiver of liability for "the applicant ..." must refer to persons in subsection (a) situations. This is an incorrect reading of the statute. "Applicant" refers to the individual who first obtained the grant and not to an individual who "is not qualified to file an application under section 605 or ... not approved as a transferee by the state agency ..." Id. at § 291i(a).
Furthermore, the regulation, 42 C.F.R. § 53.135, promulgated by the Secretary, pursuant to 42 U.S.C. § 291i(b), makes clear that the waiver provision applies only to subsection (b) situations where the facility "has ceased to be a health center ..." Id. 42 C.F.R. § 53.135 provides as follows:
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...defendant may request a waiver of liability from the Secretary of Health and Human Services under § 291i(b). In United States v. First Georgia Bank, 529 F.Supp. 384 (N.D.Ga.1982) the defendant in a similar recovery action argued that the waiver provisions found in § 291i(b) applied to § 291......
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