The following section from Day on Torts Leading Cases in Tennessee Tort Law​​​ is out of date and should not be used. It remains a part of this site for historical purposes only. An updated version of the book is available by subscription at (Additional information below.)

§47.15 Duty, Non-Delegable

The Case: Scott v. Ashland Heathcare Center , 49 S.W.3d 281 (Tenn. 2001).

The Basic Facts: Plaintiff brought a wrongful death suit against nursing home operator, nursing home builder, and wholly-owned subsidiary of builder on behalf of the beneficiaries of resident at a nursing home who died while in the nursing home's care.

The Bottom Line:

  • "We granted review of this case to determine whether the holder of a certificate of need may be held liable for the healthcare facility operator's tortious acts. We hold that the Tennessee statutes and rules governing certificates of need impliedly impose a non-delegable duty upon the certificate of need holder to initiate operation of the healthcare facility." 49 S.W.3d at 282.
  • "Ms. Scott's position is that the Tennessee health care facility regulatory scheme imposes a non-delegable duty on the owner of the facility and certificate of need holder to initiate operation of the facility. After carefully reviewing the applicable statutes and rules, we agree." Id. at 285.
  • "To legally construct and open a nursing home for operation in Tennessee, it is necessary to obtain both a certificate of need and a license. Tenn. Code Ann. §§ 68‑11‑106(a)(1) and 68‑11‑204(a). Section 68‑11‑106(a)(1) specifically requires issuance of a certificate of need for '[t]he construction, development, or other establishment of any type of health care institution.' 'Health care institution' is defined to include a nursing home. Tenn. Code Ann. § 68‑11‑102(4)(A). In 1988, when Medical Holdings applied for and was granted its certificate of need for the Oakland facility, § 68‑11‑106(d)(2) addressed the criteria for certification as follows:
    No certificate of need shall be granted unless the action proposed in the application for such certificate is necessary to provide needed health care in the area to be served, can be economically accomplished and maintained, and will contribute to the orderly development of adequate and effective health care facilities and/or services. Specific criteria for certification of need shall be prescribed by rules of the commission."
    Id .
  • "We find that the Health Facilities Commission's certificate of need screening procedures indicate an intent that the certificate of need holder be responsible for initiating the operation of the health care facility. The application process would not require investigation of the projected operation of the facility if it were not assumed that the certificate of need applicant would, in fact, operate the facility." Id.
  • "Moreover, the certificate of need application filed by Medical Holdings stated that approval was sought for the construction and operation of the facility. The Health Facilities Commission relied upon the representations of Medical Holdings in the application when the Health Facilities Commission approved the project. We find that Medical Holdings received its certificate of need on the premise that it would both construct and operate the Oakmont facility." Id.
  • "Section 68‑11‑204 requires that an entity obtain a license to 'establish, conduct, operate or maintain' a nursing home in Tennessee. 'No agency of the state . . . shall . . . issue any license to, a health care institution for any portion or activity thereof which is established, modified, relocated, changed, or resumed, or which constitutes a covered health care service, in a manner in violation of the provisions of this part.' Tenn. Code Ann. § 68‑11‑106(c). In other words, no license for operation of a health care facility may be issued to an entity that does not hold a certificate of need. Ann Dodd, who handles licensing of nursing homes and hospitals for the Tennessee State Department of Health, testified in her deposition that an initial facility license could only be issued to the owner listed on the certificate of need. We find that the licensing scheme requiring that the same entity obtain both the certificate of need and the license for operation impliedly imposes a duty upon the certificate of need holder to initiate operation of the health care facility." Id. at 286.
  • "Construction of the certification and licensing statutes and rules in this case requires finding that the certificate of need holder is responsible for both the construction and initial operation of the health care facility. To hold otherwise would not give effect to the legislature's strategy for ensuring adequate, orderly, and economical health care for the citizens of Tennessee. The certificate of need and licensing procedure would be rendered meaningless. We cannot endorse such circumvention of Tennessee law." Id.
  • "The lack of transferability of both the certificate of need and the license is evidence that the legislature intended the certificate of need holder's duty to operate the health care facility to be non-delegable. This conclusion is supported by Attorney General Opinion No. 85-154. 'Although opinions of the Attorney General are not binding on courts, government officials rely upon them for guidance; therefore, this opinion is entitled to considerable deference.' State v. Black, 897 S.W.2d 680, 683 (Tenn. 1995). In Opinion No. 85-154, the Attorney General reviewed the rules and regulations governing the issuance of certificates of need to determine whether a certificate of need could be transferred from one entity to another before construction and operation of the facility. The Attorney General pointed to the specific criteria that a certificate of need applicant must meet for approval. The Attorney General opined that allowing the sale of a certificate of need before construction and operation would remove control over the criteria mandated by federal and state law, allowing abuse of the law by the health care industry to the detriment of the public. We agree with the reasoning of the Attorney General. Public policy dictates that the duty imposed upon a certificate of need holder to initiate operation of a health care facility may not be transferred to another entity." Id. at 287.
  • "We hold that the Tennessee statutes and rules governing certificates of need and licenses impliedly impose a duty upon the certificate of need holder to initiate operation of the healthcare facility. Any change in ownership or operation of the facility after it has begun operations must comply with all applicable regulations of the Health Facilities Commission and the Licensing Board. Public policy and common sense interpretation of the statutory certification and licensing scheme require that this duty be non-delegable." Id.

Recent Cases: Wicks v. The Vanderbilt University , No. M2006-00613-COA-R3-CV, 2007 WL 858780 (Tenn. Ct. App. Mar. 21, 2007) (reversing dismissal of negligent supervision claim against hospital).

After an accident, many injury victims and their families want more information on the accident and their legal rights. Consequently, many of them have found their way to these pages. While we are happy you are here, please understand Day on Torts: Leading Cases in Tennessee Tort Law was written to be a quick, invaluable reference for Tennessee tort lawyers. While the book provides the leading case for more than 300 tort law subjects and thousands of related case citations, it is not a substitute for personalized legal advice from a qualified lawyer.

Rather than researching these legal issues alone, we urge you to contact one of our award-winning lawyers who can sit down with you, review your case, answer your questions and clearly explain your rights and your options in a no-cost, no-obligation consultation. Our experienced attorneys handle all personal injury and wrongful death cases on a contingency basis, so we only get paid if we win. If for any reason you are unable to come to our office, we will gladly come to you.

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The foregoing is an excerpt from Day on Torts: Leading Cases in Tennessee Tort Law, published by John A. Day, Civil Trial Specialist, Fellow in the American College of Trial Lawyers, recipient of Best Lawyers in America recognition, Martindale-Hubbell AV® Preeminent™ rated attorney, and Top 100 Tennessee Mid-South Super Lawyers designee. Read John’s full bio here.

The book is now available electronically by subscription at The new format allows us to keep the book current as new opinions are released. BirdDog Law also has John's Tennessee Law of Civil Trial and Compendium of Tennessee Tort Reform Statutes available by subscription, as well as multiple free resources to help Tennessee lawyers serve their clients

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