II. Constitutional Constraints on Adjudication: Procedural Due Process. 2
III. APA Framework for Adjudication:3
IV. APA Constraints: Formal Adjudication:4
V. APA Constraints: INFORMAL Adjudication:5
VI. PDP Constraints on Formal Rulemaking:6
VII. APA Constraints on Formal Rulemaking:6
VIII. APA Constraints on INFORMAL Rulemaking:7
IX. The Adjudicating Rulemaking Choice:10
X. Congressional and Presidential Control:13
XI. Judicial Review:18
Congress can’t delegate away its legislative power. The legislature must at least make the fundamental policy choices, leaving the agency to decide the more precise questions.
Source: Art. I §1.
Meaning: Current doctrine: “congress must articulate an intelligible principle of law” Mistreta. Congress can delegate rulemaking authority to an agency, but its grant of authority cannot be an unjustifiably indeterminate.
H.L.A. Hart: everything is indeterminate, but there are pros/cons for indeterminacy:
i. Pro Indeterminacy:
1. Agency expertise
2. Allows for case-by-case decisionmaking
3. Legislative “capture” – dominated by special interest groups – takes power away from Congress
4. Agency flexibility (Congress, on the other hand, would have to amend statute)
5. More presidential control (more democratic)
1. Agency “capture” to special interest
2. Congressional Control—may be more democratic?
3. Congressional expertise?
4. Notice to affected parties
Application: Congress can delegate rulemaking/adjudicatory power to agency/private individual, but the indeterminacy in the delegation cannot be unjustifiably high; to tell this, weigh the above factors.
NB: this is dead letter law.
Cases: Schecter (1973), Mistretta.
II. Constitutional Constraints on Adjudication: Procedural Due Process
Adjudication: agency process that results in order—formal particular legal directive/statement addressed to particular individual.
Procedural Due Process:
Goldberg v. Kelly: DP requires some things of Friendly’s list(316) where π would suffer a grievous loss from a deprivation (Supplanted by Matthews). Raises Q’s of what DP requires and what is a lib/prop interest.
Trigger: You need a legitimate claim of entitlement: Is there a liberty/property right?
i. Government must infringe some interest created by the DP clause/Const. itself: so there must be coerce, prohibit, stigma (attached to the fired person in Roth, e.g.)
1. Look to the Constitution for DP liberty rights, not the statute that generated them. Loudermill. DP is an independent judicial Q.
2. Rejects the “bitter w/ the sweet approach” of Arnett.
ii. The right to have a common job is a liberty interest.
i. Grounded in non-Constitutional law (state law, statutes, admin rules, CL, K agency unwritten practice, judicial precedent).
1. Perry – unwritten practice of rehiring was enough
ii. Reliance interest:
1. Generated from specificity of statute (but see HLA HART) sufficient to generate reliance.
2. Look for mandatory words like “shall, not, may”
How Much Process is Due? (Matthews v. Eldridge)
i. 3 Factor Moral Balancing Approach:
1. Private interest
2. Government interest (cost)
3. Risk of erroneous deprivation
a. This tells you which of Friendly’s list you incorporate.
Reasons for limitation:
i. Language of DP clause; don’t want to open floodgates, concerns about judicial activism/values.
i. Find a DP interest, either property (reliance from statute etc.) or liberty interest (const.)
1. See if prop interest is sufficient and the reliance is generated from specific and mandatory statute
ii. Matthews balancing test after mentioning reasons for limiting.
III. APA Framework for Adjudication:
Formal Adjudication governed by §§ 554, 556, 557.
APA Framework for adjudication:
§554 – Triggers formal adjudication
i. §554(a): triggering provision to determine whether formal or informal (“hearing” or “hearing on the record”)
ii. §554(b): notice to parties, settlement
iii. §554(c): opportunity for pre-hearing submissions
1. if no settlement, jump to formal procedures of §556-57.
iv. §554(d)(2): ALJ must be separate from enforcement staff, cannot be supervised by investigating/prosecution group (but doesn’t apply to agency).
i. §556(b): presiding officer at hearing (evidence gathering process)
1. must be impartial
2. separate from enforcement
ii. §556(d): provision for oral hearing: party can submit oral evidence, submit rebuttals and conduct cross-examination as required for full and true disclosure of the facts – not unlimited!!!
1. Can adopt written hearing if other party not prejudiced
iii. 556(e): exclusive record: hearing process is a process of building a record which à exclusive record of decision
i. 557(b): decision maker: where ALJ presides, need not issue a decision, can just certify the record to the agency for decision
ii. 557(c): decision must include (i) statement of findings/conclusion; (ii) and reasons.
iii. 557(d): no ex parte contacts w/ person outside agency
1. communication w/ president could be problematic depending whether he is inside or outside the agency (Adler says outside is OK).
2. EO prob ok because public?
Informal Adjudication: not too many guarantees
§555(b): can be represented by counsel, interested person may appear before agency for determination of an issue in connection w/ agency function.
§555(d): right to subpoena
§555(e): prompt notice of denial.
But – Overton park requires a de facto administrative record (not formal public record).
PDP – probably don’t want EO interfering unless it’s very rule-like.
IV. APA Constraints: Formal Adjudication:
Seacoast Anti-Pollution League v. Costle (1st Cir.) Is APA formal adjudication applicable?
i. The word “Public Hearing” is sufficient to trigger formal adjudication (i.e., not “hearing on the record”).
Compare with U.S. v. Florida East Coast:
Was no cross-examination OK?
i. Agency allowed written submission to respond to PSCO’s backflushing.
ii. YES, OK: Only have a presumptive right to cross-examine under §556(d), and only when it’s required for a full and true disclosure of the facts.
1. àRemanded to see if cross-exam necessary.
Was admin seeking add’l evidence from in-house technical panel OK?
i. Not outside of the agency so within §557(d), ALJ CAN’T consult a person or party but the agency CAN
iii. Constitution (PDP) – not really applicable to rulemaking (Bi-Metallic)
iv. Arbitrary and Capricious (706(2)(A)).
Londoner v. Denver
Denver assesses tax for one district for road work. Notice by publication, and opportunity to present written evidence. No hearing.
No hearing violates PDP. Significantly affects landowner’s interest.
i. “a relatively small number of persons was concerned, who were exceptionally affected … upon individual grounds.”
Compare with Bi-Metallic v. Colo.:
Colo. raised property taxes for Denver only by 40%. Π argues violation of PDP
No PDP violation. Hearing not required.
i. When rule applies to more than a few people, impractical that everyone should have voice. Those rights are protected in the political process.
PDP does not apply except if there’s a Londoner “small class” exception, then it is treated like an order for purposes of PDP. There needs to be both a small number of people affected and the rule must rest on specific, as opposed to general facts.
 Goldberg v. Kelly: π’s welfare benefits terminated before oral hearing.
 Roth: π, teacher, wasn’t rehired and there was no reason and no review
 Loudermill: π, security guard lies on application, fired w/o pre-termination hearing.
 Perry v. Sinderman: Property interest generated implicitly from rehiring practice of teachers that wasn’t done here.
 Matthews v. Eldridge: disability recipient had benefits terminated; only post-termination hearing allowed, pre-term written submission is okay.
 PSCO operates nuclear power plant, wants permit from EPA; π claims violations of APA. EPA: “APA doesn’t apply.” EPA Admin requested add’l info from PSCO about backflushing, gave other parties the opportunity to on PSCO’s submission, and stated that he would hold another hearing if requested. A hearing was requested and denied. The Administrator made a final decision following the technical panel’s recommendations and, with the additional information submitted, reversed the Regional Administrator’s decision.
 Richardson v. Perales: SSA denies benefits to disabled truck driver using substantial evidence standard, based on written medical reports in the face of opposing oral testimony. SC holds written medical reports are admissible even though hearsay rule. Cross-examination only allowed for full and true disclosure. DP not implicated when π failed to request subpoenas.
 Pension Benefit v. LTV: LTV could no longer fund its pension, so PBGC terminated and took on these plans, at a lower level. LTV then negotiated and made some “follow-on” plans that made up the difference. PBGC hates these follow-on plans and finds them to be an abuse. PBGC issued to LTV that it was restoring the pension plans because of LTV’s changed circumstances (i.e., pulling out of financial trouble). LTV Refused to comply. PBGC did not have any real procedures: it didn’t apprise LTV of the material on which it was to base its decision, didn’t give LTV adequate opportunity to offer contrary evidence, nor did it provide statement showing its reasoning