CHAPTER 1: ADMINISTRATIVE LAW PRACTICE
INTRODUCTION
ALWAYS START WITH THE STATUTE!
The agency must always have a statutory grant of power to do what it is doing.
ALWAYS ASK if the agency is within the power granted to them.
Start your discussion always with “The statute says…,” because that statutory grant will mark the limit of the agency’s power.
Must also have explicit power to promulgate regulations.
Typical outcome of administrative agency lawsuits:
Plaintiffs often lose…the court usually defers to the agency or county.
What do agencies do?
regulating private conduct or the conduct of other government bodies
administering entitlements (here, the volume of cases would be so huge that the appellate process must be streamlined and very routine)
everything else (e.g. INS, IRS)
Types of agency action:
Rulemaking (legislative function)
Adjudication (judicial function)
Investigation (executive function)
Types of power to obtain information:
Subpoena
Compel filing of reports by regulated bodies
Inspection
Agencies: § 551(1) definition
· Departments (Treasury, HUD, Interior, Labor)
· Independent Agencies (FCC, FTC, NLRB, SEC)
Independent Agencies:
These agencies have boards rather than sole heads, so they won’t change that much with presidential whims. The board members have fixed terms, and the president can’t remove them except for cause. Should there be this type of limit on presidential power?
Andersen’s Rule of Politics: nothing is ever really finished. The losing party can always seek a new forum tomorrow (go to Congress, appeal, etc.)
APA BASICS (Administrative Procedure Act of 1946)
Definition of RULE: § 551(4) – ignore the “particular applicability” portion (Andersen thinks it’s misleading), and just focus on the “generally applicable” language. General applicability and future effect.
Definition of ORDER: § 551(6) – other than rulemaking…includes licensing (§ 551(a)) and permits (§ 551(8)).
RULEMAKING – § 553
Informal Rulemaking:
Three-step process
Agency must publish a notice of the proposed rule in the FR. § 553(b)
Exceptions: interpretive rules, general statements of policy, or rules of agency organization, procedure, and practice. § 553(A)
Also can bypass notice for “good cause.” § 553(B)
Agency must give interested persons an opportunity to participate by submitting written data or maybe oral presentations at a hearing (at agency’s discretion). § 553(c)
Agency must incorporate in the rules a concise general statement of their basis and purpose (which appears in the FR along with the rule). § 553(c)
Formal Rulemaking:
In formal rulemaking, the agency replaces steps 2 & 3 above with procedures in § 556-557.
§ 553(c) – TEST: Formal RM required when agency’s mandate statute requires the rules to be made on the record after an opportunity for agency hearing.
Hybrid Rulemaking:
Some agencies are required to follow more procedures that are added to the basic floor of informal RM. E.g. FTC must include an informal hearing with oral presentations, and can include witnesses and cross-examination. But doesn’t rise to level of formal RM.
ADJUDICATION – § 554
§ 554(a) – TEST: Formal adjudication required when the agency’s statute requires determination on the record after a hearing. * If so, use § 556-57.
Formal Adjudication:
§ 554 requires the use of procedures typically used at trial.
Notice. § 554(b)
Opportunity to reach a settlement. § 554(c)(1)
Must be conducted in accordance with § 556 and § 557.
§ 556 – Addresses the hearing procedures; authorizes use of ALJs (§ 556(b) – (c)) and places the B/P on the agency. Any decision must be based on the evidence in the record. § 556(d)
§ 557 – Addresses the appeal procedures.
Informal Adjudication:
If agency doesn’t have to conduct a hearing on the record as mandated by their statute, then the APA does not prescribe any procedures for adjudication.
Exception: Agency must follow certain hearing procedures if statute requires some hearing to be held, though not formal adjudication; or if the due process clause applies.
STEP #1: Ask what type of action
§ 552 – Formal rulemaking; publication in FR, FOIA requirements.
§ 553 – Informal rulemaking
§ 554 – Adjudications
o Licensing
o Revocation
o Assessing penalties
§ 556 – Formal hearings for formal rulemaking/adjudication. Very court-like, burdens of proof, evidence, cross-examinations. Subsection (c) talks about transcripts & exhibits, which create the record for decision.
§ 557 – Decision-making. Who is qualified to make the decision? Persons presiding over the § 556 hearings are ALJs (who have some measure of independence b/c pay and tenure is set by another agency).
WAPA: office of administrative hearings is totally separate.
Appeal from the ALJ goes to the agency itself.
Judicial Review
§ 701 – JR may be precluded by §.
§ 702 – Limits πs; must have standing.
§ 704 – final actions only are reviewable.
§ 706 – scope of review (lists several standards of review)
Goals for APA procedures:
Accuracy in fact-finding
Efficiency acts as a constraint.
Acceptability.
ETHICS
Article: Bruce Fein (p. 38)
New Reagan administration – philosophical dispute with agency.
Used New Deal attorneys as an example – should always support the President and try to help his agenda, because he’s the client.
Article: Douglas Letter
Situations where the government attorney had different obligations than the private attorneys (had to be more ethical).
DOJ attorneys: goal is to do justice. Can take a broader position because they don’t represent any particular agency.
Considerations:
Agency is client?
President is client?
Higher duty to “serve justice?”
Pay attention to the Rules of Professional Conduct. In an extreme case, if the RPC does not agree with what your client is asking you to do, your only option might be to quit.
RULEMAKING
INITIATING RULEMAKING
Recall that hideous 1980s movie: “The Rulemakers.”
Initiating the RM process:
What are you asking for?
Repeal
Amendment
To promulgate a new rule?
Where do the ideas come from?
Bottom-up (lower level workers in agency make suggestion to supervisor)
Top-down (political pressure from agency head, Congress, President)
Outside the agency.
Problem: you’re a me
reluctant to force action.
BASIC PROCEDURE(p. 91 – 111)
U.S. v. Allegheny-Ludlum Steel Corp. (p. 92)
ICC set rates for railroad cars using informal rulemaking. Corp. sought JR.
How do we know they were rulemaking? § 551, the definitions: note the emphasis on future rates in the statute.
Since they were rulemaking, they had to choose whether to use informal or formal procedures.
APA § 553 says that if the statute that gives the agency its power requires it, then you use formal. We’d have to look at the ICC act to see if that statute requires agency rules to be made on the record after a hearing.
In this case, there was no requirement that the rules be made “on the record,” (only that it had to be “after hearing”) so §§ 556 /557 did not apply and they properly used the informal process.
APA never requires formal rulemaking…it only gives guidance for when the authorizing statute requires rules to be made on the record after a hearing. CHOICE is left to Congress. The agency may also make their own rules, to add stricter procedures if they choose.
U.S. v. Florida East Coast Railroad Co. (p. 92)
As noted in Allegheny, the ICC language that “after hearing” does not trigger the formal rulemaking procedures. The district court here thought that there were more factors in the statute that indicated formal rulemaking. Court was trying to send Congress the message that they have to use the magic language in order to require formal hearings. Even if there was a formal hearing required, it did not mean you get to have cross-examination or the right to present oral arguments (the exception in 557).
Why the hostility towards formal rulemaking?
RM seems to work best as a legislative process. Injecting too much legal complication makes the process less effective.
If Congress wants formal RM, they have to use the explicit language in the APA, to make clear their intent to have a rule made on the record.
Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, Inc. (p. 94)
Held: absent constitutional constraints or extremely compelling circumstances, agencies should be free to fashion their own rules of procedure and pursue methods of inquiry tailored to their tasks. List of considerations given to support the court’s holding:
importance of predictability of JR
too much second-guessing
misapplication of the standard of review
Court of Appeals wanted to remand the case back to the agency due to inadequate support in the record. Supreme Court said that the court may not add additional procedures to what the statute requires. Just because the Court
