Administrative Law Spring 2012 — Gedid
I. Introduction
II. The Constitutional Right to a Hearing
a. Hearings and Welfare Termination: Due Process and Mass Justice
i. Administrative Procedure (Balancing Test)
1. Accuracy – does it get it right most of the time, settle factual issues correctly most of the time
2. Efficiency – is it efficient? To bring expertise to the solution of problems in a way that is not as expensive as judicial procedure
3. Fairness – means different things to different people
a. Something that comports with our ideas of due process – there is notice and meaningful timely opportunity to be heard
b. Timey opportunity to be heard can vary from anything from a full trial type hearing to paper hearing
i. Hewitt v. Helms
ii. Goldberg v. Kelly
1. Two Part Test
a. Balancing Test between private individuals v. Government interest
i. Private Individual – brutal actions
ii. Government Interest – keeping costs down and getting the maximum money to eligible recipients
b. Whether there is a deprivation?
i. Is there an interest protected by Due Process?
ii. When do get the hearing?
iii. What are the procedural elements of the hearing?
2. RULE: If the state wants to terminate the benefits, it must provide notice and hearing before doing so
b. Interests Protected by Due Process: Liberty and Property
i. “Liberty” and “Property” as Defined in Roth
1. A liberty interests include the right to enjoy the qualities of life recognized as essential to the pursuit of happiness.
2. Board of Regents v. Roth – entitled to a hearing for the purpose of clearing his name
a. Facts: Non-tenured professor who spoke out regarding the Vietnam War and spoke out against administers. Got terminated by letter.
b.
ii. Refining the Roth Approach to Property and Liberty
c. Timing of Trial-Type Hearings
i. Goldberg determined that a trial-type hearing must be held before termination of benefits.
ii. Mathews determined that an evidentiary hearing must not be held before termination of benefits to disable persons under Title II of the SSA.
d. Elements of a Hearing
e. The Rulemaking-Adjudication Distinction
i. Adjudication – government action that affects specific persons
1. Example: Welfare’s agency’s decision to terminate A’s benefits because A’s income is too high
ii. Rulemaking – government action that affects a class of persons
1. Example: Establishment of a standard for determination of the income of welfare recipients in general (whether by legislation or by administrative rule)
2. PROCEDURAL DUE PROCESS DOES NOT APPLY HERE
III. Administrative Adjudications
a. Statutory Rights to an Adjudicatory Hearing
i. Gateway Problem – determining which agency adjudicatory proceedings are covered by the APA
1. The Federal APA and most state statutes lay out ground rules for formal hearings, but agencies need not use those procedures unless an external source (such as another statute or the state or federal constitution) requires an evidentiary hearing
a. Have to find another statute (other than the APA) that requires the agency to hold on the record hearing (or otherwise makes it clear that Congress intends the formal adjudication section statute of frauds the APA to apply).
b. If there is no such statute, the APA formal adjudication provisions do not apply – then we have informal adjudication and it is not controlled by the APA
2. Formal v. Informal Adjudications
a. Formal Adjudications – Adjudication conducted under the APA ground rules
i. Lay out ground rules for formal hearings, but agencies need not use those procedures unless an external source (such as another statute or the state or federal constitution) requires an evidentiary hearing
b. Informal Adjudications – No external source requires an evidentiary hearing, the agency is usually free to choose its own dispute resolution procedure
ii. Federal Law – Right to a Hearing Under the APA
1. APA §554(a) – “Adjudication required by statute to be determined on the record after opportunity for an agency hearing…”
a. When a federal statute outside the APA calls for an agency hearing that is “on the record” this signals that Congress intends that a formal adjudication section of the APA come into play.
b. Therefore the gateway provision in the Federal APA depends on an external source to trigger the APA’s adjudicatory provisions.
i. The external source MUST either
1. Explicitly state the APA will apply; OR
2. At least use the code words “on the record” or their equivalent
c. “On the record” really means “on the exclusive record” which means that the trier of fact is not allowed to consider any evidence except that which has been admitted at the hearing
i. However, many hearings that are not required to be conducted as APA formal adjudicatory hearings respect the “exclusive record” requirement
ii. So, “on the record” really doesn’t mean anything except to signal the intent of Congress that the APA should apply
2. Dominion Energy Brayton Point, LLC v. Johnson
a. Dominion sought a permit from the EPA to discharge water heated by an electric generating facility into the water. The statute provides that the EPA must provide an “opportunity for public hearing” before granting this permit. The EPA adopted regulations providing that it would conduct only informal rulemaking-type proceedings in water permit cases, not formal APA adjudications as it had done in the past.
b. Does “hearing” or “public record” have to automatically mean that that hearing has to be on the record? No
i. Hold that the word “hearing” is ambiguous and the agency’s interpretation that it does not require APA formal adjudication is reasonable
c. Under the Chevron factors, if a statute is unclear and the agency’s interpretation is reasonable, the court must defer to that interpretation
i. The court found that the agency’s interpretation of phrase “public record” to be reasonable and deferred to its judgment
b. Limiting the Issues to Which Hearing Rights Apply
i. Whether an agency must provide an adjudicatory hearing prescribed by statute if the agency has already addressed the disputed issue in a rule.
ii. In effect, the rule has preempted an area of adjudication by legislatively determining the factual questions in issue – in that situation the agency can deny a hear
iii. Heckler v. Campbell
1. Issue: Whether the Secretary of Health and Human Services may rely on published medical-vocational guidelines to determine a claimant’s right to Social Security disability benefits
2. A statute granted disability benefits only if an individual could not engage in any gainful activity by reason of the disability. The agency by rule adopted a “grid” system that indicated whether a disabled person with particular qualifications could obtain a job. The court held that the applicant was not entitled to a hearing (under the Constitution or the statute) on the issues settled by the rule.
3. Holding: an agency can resolve an issue by adopting a rule and thereby displace an individual’s statutory right to an evidentiary hearing on that issue. By statute, a disability determination must be based on evidence adduced at the hearing, but this case establishes that the determin
hanker, prominent head of a teacher’s union, is an “interested person” with respect to a case involving an illegal strike by a federal employees’ union
6. Remedies for Ex Parte Hearings
a. Disclosure of the communication
b. Requires the violating party to “show cause why his claim or interest in the proceeding should not be dismissed, denied, disregarded, or otherwise adversely affected on the account of [the] violation
c. Whether as a result of improper ex parte communications, the agency’s decisionmaking process was irrevocably tainted so as to make the ultimate judgment of the agency unfair:
i. The gravity of the ex parte communications
ii. Whether the contacts may have influenced the agency’s ultimate decision
iii. Whether the party making the improper contacts benefitted from the agency’s ultimate decision
iv. Whether the contents of the communications were unknown to opposing parties, who therefore had no opportunity to respond
v. Whether vacating the agency’s decision and remand for new proceedings would serve a useful purpose
iv. Agency Adjudication and Legislative Pressure
1. Congressional pressure on agency adjudicators while a case is in the hearing stage may deprive the parties to the adjudication of due process
2. Pillsbury Co. v. FTC
a. An initial FTC decision was severely criticized in a congressional subcommittee hearing. The FTC chairman was closely questioned, and other FTC members were also present. The Chairman then withdrew from further proceedings in the matter, but other who were present and questioned did take part in the final decision against Pillsbury. The court found this congressional intervention unwarranted and a violation of due process. Nevertheless, the FTC was not permanently disqualified from hearing the case because during the 13 years since the case began, there had been sufficient change in personnel so that the matter could be remanded to the FTC for the decision.
v. Separation of Functions and Internal Agency Communications
1. Agency’s usually act as a legislator, investigator, prosecutor, judge, and jury rolled into one
a. The functions are combined primarily for reasons of efficiency and effectiveness
2. When a single agency has combined functions, the issue shifts to whether a single individual within the agency can plan an adversary role in a particular case (as investigator, prosecutor, or advocate), then serve an adjudicatory role (as administrative judge, agency head, or adviser to either of them) in the same case.
a. Example:
3. Most agencies are structured to achieve an internal separation of functions
4. Persons engaged in adversary conduct on the agency’s behalf cannot serve as an administrative decision-maker or furnish off-the-record advice to the decisionmakers in that same case
a. BUT, staff members who did not play adversary roles in a particular case are permitted to furnish off-the-record advice to agency heads in that case.
