Select Page

Administrative Law
Penn State School of Law
Mathews, Jud

Administrative Law, Spring 2014
Professor Judd Matthews
The Penn State University, Dickinson School of Law
Text Book: Federal Administrative Law Cases and Materials, Hickman and Pierce Jr. (Foundation Press 2010)

I. Introduction
A.     Theory of Administrative Law
1. Three forms of scholarly inquiry into administrative law
a.       Constitutional relationship
i.        How is agency action consistent with democracy and the constitutional balance of power?
ii.      Administrative state is the fourth branch of government
b.      Process and procedures (rulemaking and adjudication)
i.        How are administrative agencies structured?
(A)  Software of governance (where agencys fit):
(1)   Agency decides policy issues – this is an area of congressional power that is broad and congress was delegated (through the constitution) freedom to decide policy issues
(B)  Hardware of governance:
(1)   Process by which congress can take action is not malleable
(2)   Congress cannot change the hardware of governmental action
c.       Judicial oversight of agencies
i.        Due process concerns
ii.      Not deciding if agency action was right decision to make
iii.    Deciding if the agency acted within its power or if it acted arbitrarily/capriciously

2. Historical Perspective of Administrative Law
a.       Delegation of Power to an agency was part of the original intent within the constitution
i.        Prevents tyranny by dispersing power to many instead of keeping power with a few individuals
b.      1800s – agencies were largely out of judicial review
i.        sole cause of action was at common law against an employee
c.       First half of the 20th century/early 1900s
i.        Transmission belt theory: agency applies legislative command to individual facts and circumstances, courts police the agency to make sure they follow orders
d.      1887 and the Progressive Era/New Deal Expansion of Agencies
i.        1887 congress established interstate commerce commission (ICC) – the first independent agency
ii.      During the New Deal Era/Progressive Era agencies are viewed favorably because they were seen as
(A)  Neutral (outside of the political arena)
(B)  Made up of third parties
(C)  Made of a body of experts who know more about this subject than the average politician (agency officials are more equipped to make this type of decision)
(D) The agency is more likely to act in the public interest because they are not motivated by the political process
e.       1946 and the Administrative Procedure Act (APA)
i.        1st enacted after the new deal to respond to the need for structure and uniformity in growly field of administrative agencies
ii.      Decade of debate concerning the APA
iii.    Original intent:
(A)  Uniform procedures
(B)  Uniformity surrounding agency and court relationship
iv.     Debate over giving broad powers to agencies or if the APA should start to limit already granted powers
v.       WWII promotes compromise within congress (there needs to be agency reform and it needs to happen in the wake of an economic crisis/war)
(A)  1946 congress unanimously passes the APA after the drafters adopt broader language to appease the many interests at stake
(B)  APA is the default statute and the agency’s organic statute can overrule/supplement APA
f.        1960s -1970s
i.        Agency Upheval
ii.      General ides about agencies change:
(A)  Skepticism
(B)  Agency is acting in alignment with industry they are meant to regulate
iii.    Skepticism gives rise to:
(A)  Broader plaintiff standing
(B)  Presumption in favor of judicial review of agency action (need to have a greater check and balance system to make sure the agency is not married to the industry)
(C)  Expanding due process requirements to protect individuals from agency power
iv.     Agencies start to shift to promulgating regulations and move away from case-by-case enforcement
(A)  Want to move away from retroactive rulemaking and move toward prospective rulemaking
g.       Modern era
i.        Key issues related to admin law:
(A)  Does congress have the power to delegate power o solve policy issues of our nation?
(B)  What to do with independent agencies?
(C)  Do agencies have the power to adjudicate (should they have both legislative and judicial powers? Doesn’t this seem unfair?)
ii.      Newer standards or judicial review look at these issues
h.      Two theories surrounding agency and administrative law:
i.        Public Interest Theory
(A)  Agencies are independent of politics and therefore they will do what is best for the common good
(B)  Agencies are made up of experts who are better able to make decisions utilizing their intelligence and expertise
ii.      Public Choice Theory
(A)  Agency members are rational actors in the political process
(B)  Agency members are acting with their own interests in mind (ie: what is best for their professional career)
i.        Critique of the Administrative State
i.        Agencies have concentrated influence over policy efforts and the cost of this concentrated influence is distributed
ii.      The actors with the most to lose will take the most action
(A)  Not every actor will take the same amount of action or invest the same amount of resources in an effort to self advocate
iii.    Agency and industry are married “in bed together”
(A)  Agency is removed from politics and this takes away presidential power to check the agency or support the agency when it takes an action against the industry’s interest
(B)  Without political process support the agency is bullied by the industry it is set up to regulate

3. How to identify an administrative agency
a.       APA broad negative definition (define what an agency is by stating what an agency is not)
i.        §551 – agency is each authority of the government of the US (regardless of being subjected to review by another agency). But agency does not include:
(A)  Congress
(B)  Courts
(C)  SCOTUS in Franklin v Mass added that the president is not an agency
ii.      Within §551 – non-agencies are split into two categories:
(A)  §551 A – D agencies that are totally exempt from APA
(B)  §551 E- H agencies that are not exempt from §552 Freedom of information Act (“FOIA”)

b.      TEST: Is this an Agency?
i.        Step 1: Is this an agency under §551?
(A)  Ie: is this an AUTHORITY that is not the president, congress, or the courts?
ii.      Step 2: Is the agency wholly excluded from APA or is the agency modified-exclusion from APA?
(A)  Ie: is this an agency listed in §551 a-d (excluded) or §551 e-h (modified)
iii.    Step 3: If the agency is a modified exclusion agency then:
(A)  Is the office representing US governmental authority?
(1)   If yes: agency covered under APA
(2)   If no: not an agency covered under APA

c.       Agencies have two main activities
i.        Adjudication – judges are federal employees (Administrative Law Judge)
(A)  Two types of adjudications
(1)   Formal adjudications (this is what we will focus on in the class)
(2)   Informal adjudications (won’t cover this in the class)
ii.      Rulemaking
(A)  Agencies pass between 500 and 700 significant rules each year
(B)  Legislature passes a few significant statutes p

ocuses on authorities and organizations that have no authority are plainly excluded from the APA and FOIA mandates
(2)   How to determine if an agency has substantial independent authority:
a(a)Substantial Independent Authority
(i)     Evaluate scientific research programs – initiate and fund research, and award scholarships = substantial independent authority
(i)     Duty to prepare federal budget = substantial independent authority
b(a)                        No Substantial Independent Authority
(i)     Cannot fund projects
(i)     Cannot issue regulations
(i)     Cannot direct executive branch officials
(i)     Cannot issue guidelines or directives
(i)     Offer operational and administrative support only (ie: the cleaning staff at the white house do not have substantial independent authority even though the assist the president)

B.     Agencies and the American Government – When Due Process applies
1. Due process claims against the government for individual claims
a.       Only certain types of government acts raise due process issues
b.      The governmental act must deprive a person of:
i.        Life – very rarely do individual claims of due process violations of life arise
ii.      Liberty
iii.    Property
c.       Due process requirements attach to agency adjudications and do not attach to agency rulemaking
i.        In order to figure out if an agency has taken action through rulemaking or adjudication courts rely on the following:
(A)  APA definition of adjudication/rulemaking are broad so this is often not very helpful in identifying if something is an adjudication vs. a rulemaking
(B)  Courts rely on lonodner and bi metallic to distinguish adjudication and rulemaking – SCOTUS decisions from the early 1900s
d.      Judicial structure and review is built on the distinction between adjudicative agency actions (Londoner) and rulemaking agency action (BiMetallic)

2. Londoner v. Denver 1908
a.       Background information:
i.        Courts are wrestling with question of how to deal with the emerging field of agency law and what role the courts should play
ii.      Justice moody wrote the opinion of Londoner v. Denver
(A)  nominated by Theodore Roosevelt (republican)
(B)  Harvard Law graduate
(C)  Prosecutor in the Lizzie Borden Case (a female axe murderer case)
(D) Served as the Secretary of the Navy Attorney General
(E)  Confirmed an associate justice of SCOTUS in 1906 (this decision was written in 1908 – he’s a new justice)
(F)   1909 leaves the bench – death
(G) Political philosophy: favors enhanced federal powers
b.      Procedural History:
i.        Colorado state court: π wants relief of tax payments, says that his due process rights were violated when the City of Denver assessed the cost of taxes – trial court grants relief
ii.      Supreme Court of Colorado reversed and grants judgment for ∆
iii.    SCOTUS grants cert – reversed