86
Admin 2004
Administrative Law Outline
Professor Andrew Popper
Spring, 2004
Assignments
The assigned cases must be read. There will be discussion regarding each case. Readings between cases are not required (except as specified during the course of the semester) but are useful. Readings per class: Stay five cases ahead for each class.
1/12/04
Class Notes
Idea: Want gov’t to be less, but want services to be more . . .
· About governance – about how the US is governed
· Final Exam: 3 1/2 hour. Popper provides case outline for class, but exam is closed-book.
o Things that are statutorily mandated are not open for discretion by the agency or the courts
o
o E-Rulemaking à significance of being able to file comments electronically.
o Popper Contact Info
o phone: (202)274-4233 (office); Rm: 404
o home: (301)897-5636
- Entitled to judicial review except
o when specifically prohibited by statute
o ???
- Law School is a good example of administrative law – good example of the power of agencies
Historically – Administrative Procedure Act (APA)
- built around APA – the organizing statutory vehicle for admin law – Title V (begins at § 551 of Title V)
- includes lots of legislation w/ which we are familiar, i.e., FOIA and E-FOIA, Gov’t in Sunshine & Privacy Laws, Regulatory Flexibility Act, Regulatory Negotiation Act
- Notably not in the APA are the rules for privatization of gov’t function and the world of gov’t contracts.
- Privatization of Gov’t Function
o Specific review of the courts engaged in review of agency action (court rules have own section NOT in the APA)
o Major movement – privatization – shift of gov’t function from the gov’t to private contractors
o I.E. – Dept. of Defense has active full-time employees 10,000 on specific regulatory tasks, but has 100,000 contractors doing similar functions. So, the idea of privatizing is a dominant force and dominant problem in admin law b/c when you give to private entities by contract gov’t jobs – raise lots of problems of due process, etc. b/c private does not have agency structure or experience.
o So, privatization is located w/in the domain of gov’t contracts
o Governs the transfer to private parties is Contract Law and lawyers are the people who govern this.
o Lawyers draft contracts, implement the private gov’t
§ i.e., medicare governed by lawyers and often by contract.
§ Disputes over contract are often resolved by ADR and not administrative adjudication.
§ Basic protections – rulemaking & adjudication that apply to agencies to NOT apply to private contractors that are implementing the gov’ts will.
§ Moral Hazards: w/ the limited mechanisms are great; poss for conflict of interest is great.
§ Private must be profit maximizing whereas gov’t entities need not be profit maximizing.
§ Agencies can implement a policy that may not be popular at the time is implemented – i.e., certain civil law
§ Supreme Ct. decided in Shepard Poultry that giving gov’t responsibility to private entities is unC. Said congress can delegate responsibility to agencies, but not to private entities. BUT – this is not considered good law, b/c have been delegating gov’t resp.
- So, APA does not subsume the biggest piece of regulatory action – privatized activity
- base APA structure is simple
o §551 of APA defines the basic terms of ad law (rule, law, license, etc.)
o §553 of APA sets out in simple terms rulemaking
§ Rulemaking à is the process whereby agencies make rules
§ Gov’t agencies when obligated to do so, or when chose to do so, have the responsibility of producing regulations
§ Congress does not regulate – agencies do
§ Congress does not govern – agencies do
§ Contrary to the non-delegation doctrine – agencies are the tactile source of gov’t
§ President does not govern domestic policy – the goal of the President is to lead, not to govern (establish agenda). President’s power is limited and he governs not thru the white house but thru agencies
o §554 of APA – basic statute for process of Adjudication
§ rulemaking
§ resolution of disputes – adjudication
· licensing is an adjudicatory decision
· all independent judgments by agencies are adjudicatory judgment (ie, parking ticket)
· formal adj – trial by hearing
· informal – everything else that is not rulemaking
o §556 – sets out the rules for formal hearings
§ Most rulemaking is informal– notice-and-comment rulemaking
§ Formal – rule must come from a trial-like process, ie, labor, employment, discrimination fields)
· burden of proof: substantial evidence (higher than preponderance) – closer to clear and convincing evidence.
· Reliable, probative and substantial to support a decision. But does not include the term “competent”. Competent means supported by testimony that is NOT hearsay. In agency life, hearsay is admissible.
· BIG DIFFERENCE – hearsay is admissible in admin hearings.
o §701-706 of APA set out basic ideas for judicial review
§ 2 Exceptions:
· Congress decides non-reviewable
· Committed to the discretion of the agency, then no judicial review
Administrative Litigation
- What is ad lit like?
- What is unique about the correlation requirements between evidence & outcome. (i.e., when you try a case, that the evidence needs to be important to deciding the outcome – shouldn’t be a surprise.) This is true in ad to an extent
o Consider à putting a stepping station for Pepco and will be buying bulk power. Pepco proposes a new station. Who gets involved?
§ Pepco – as an applicant has the burden of proof
§ Staff from public utility commission of DC, Virginia, & MD
§ FDRC
§ EPA
§ State Dept. Protective agencies
§ Citizens Groups – favor environmental protection that don’t want the station built; favor cheaper power (disgusted w/ Pepco prices); Save the Woodchuck Foundation, Chamber of Commerce that needs power
§ licensing is adjudicatory – but have 10 parties involved. Although Pepco has the burden of proof, have evidence that will come in from 10 parties.
§ CASE – 10 parties, that have standing, that can intervene, clear interest, and all the want to present evidence – so cannot use prepon of evidence standard.
§ How does this work? How does the decision-maker decide?
· Unique – correlation – how can you use the legal process to regulate all of this information? Title V requires that you establish a basis for what you are doing when you establish a rule, but that does not mean that the agency must
· Rulemaking – correlation is next to impossible – b/c goal is to produce a rule that carries out the intent of Congress.
o fair & just rule – so agency must be educated
o people submit comments to the agency – which represents their viewpoint, and the agency educates itself. The mission is to educate.
o The rule that the agency chooses to pick does not necessarily have to meet the interests of any of the groups.
§ Conflict: Between best possible & Fairness
· Fairness – preponderance of evidence
· Statutory – best information wins
- When does the action of an agency become a rule?
- Stare decises, when dealing w/ agencies
o basic idea that there is no stare decisis when dealing w/ ad law
o on the otherhand, agency accountability & credibility is the dominant issue faced by govts at every level – so having no stare decises does nothing for gov’t.
- What happens when in Pepco HYPO – the agency decides that it is going to grant the license, but sets out some limitations. Has the agency issued a rule? NO – issued an order granting a license. But, what if the conditions are such that other stations have not implemented in the past. When does the agency action become a rule? Are agency decisions precedent?
Who Governs?
- Separation of Powers
o Congress establishes policy
o Agencies implement that power
o Executive guides agencies by the appointment process
- So what happens when a Court overrules the power of an agency?
o What happens to the classical constructs of power? The court is then making public policy.
o Every judicial decision that sets aside the decision of an agency is a violation of sep of powers b/c the courts are making public policy.
o Chevron à says that the lower cts must think thru sep of power – if an agency has done something thru a rule, an interpretation, something that is rule-like in nature, that complies w/ what Congress says, and if reasonable in the way they have done it, court cannot overturn it – Deference. If a ct is required to defer to the decision of an agency – locking in the functions constitutionally of the courts and the agencies.
o Since Chevron, a number of decisions that have begun to chip away at Chevron.
§ What kinds of decisions fall under Chevron?
§ Judicial Activism – cts make public policy, don’t care about sep of power
§ Judicial Restraint – not just conservative, but constitutional mandate. When are the courts obligated to interfere and when are they obligated to stay away?
· Agencies need space in order to function – difficult to be an agency, difficult to govern. Need to be able to make decisions. Which means that agencies need courts to defer to their decisions . . .
- How are the rights of those subject to regulatory actions, then how are private people protected?
- Whether/How To Regulate
o Historical bases for Regulation
§ Go thru significant changes to the extent we accept regulation
§ Most common variable affecting the extent of regulation is the power of the president
§ 1968 – 1973 – Nixon – explosion for regulation
§ Carter – deregulation.
§ Reagan – see programs put into place.
o Current bases for reg
o Why do we regulate
o Public Perceptions of Reg
1. Introduction
A. Read Ch. 1 in Bonfield [Read for 1/14]
· Administrative Agencies are units of gov’t other than the legislature and the courts
o Agencies typically have legal power to affect the rights or duties of individuals and entities outside the gov’t
o Agencies administer or execute law under powers delegated to them by statutes.
o May be headed by a single official or by several officials
o May be called a department, commission, board, or other name
o Most agencies are part of the executive branch but others are independent of the executive.
o Most agency heads are appointed by the chief executive, in some states, agency heads are elected
o Agencies vary in size, number of determinations made each year
o Regulatory Agencies– they enforce a mandatory scheme of prohibition or obligations (such as environmental protection).
o Benefactory Agencies – disburse benefits, such as Social Security
· Administrative Law deals w/ the legal principles common to all administrative agencies, including the procedures that agencies use to carry out their functions and the rules relating to judicial review of agency actions.
o Admin Law also defines the role of the courts, the legislature, and the chief executive, vis-à-vis agencies.
o It does NOT deal with the substantive law enforced by agencies.
o Procedural law, NOT substantive
· Administrative Procedure Acts (APAs) –
o General, meaning that they apply to all or most agencies rather than to just one or a few.
o Comprehensive, meaning that they deal w/ the main problems in admin law: public access to agency info, agency rulemaking procedure, agency adjudication procedure, and judicial review.
o Enacted in 1946, the APA established the fundamental relationship bwn regulatory agencies and those whom they regulate – between government, on the one hand, and private citizens, business, and the economy, on the other hand.
o The balance that the APA struck between promoting individuals’ rights and maintaining agencies’ policy-making flexibility has continued in force, with only minor modifications, until the present.
1/14/04 Class Notes
Example: When an agency set of decisions for a particular market will provide a better, more efficient system than an open market.
Administrative law is a question about capitalism.
- Answer by Pres. à in best of situations no regulation at all – if each trade choice is a ballot, then the balloting of the open market will create a result that is more indicative of the public desire than any regulatory body could produce. But, this is rhetoric, an ideology.
- Current Trend: Market Forces over Regulation
- But, the historical mission à contemplates the existence of a regulatory state and that the purpose of gov’t is to limit itself. Gov’t will exist and then the challenge is how small can we make it while still maintaining the important
- Why don’t open market forces always produce what is best for our society? Answer: Not everything that we want is consistent with majoritarian will. Not everything we need is how we would vote if given the chance.
- People purchase things based on self-interest
- If you make the assumption that individuals will act the way which is best for them individually à so profit maximizes and efficiency seekers – BUT we have greater over-arching values which must be protected
o public health
o protection of intellectual property
o freedom of information
o Constitutional goals à free speech
o But, our individual choices may not be consistent with maintaining these programs
- So, regulation is necessary
- But, must be careful about the reasons for regulation
History of DeRegulation
- 19th Century à debate over the size of gov’t
o size of the bank
o development of interstate commerce
- 20th Century
o series of failures in the workplace
§ devastating accidents – death
§ no workplace safety
§ a consequence of market force
- Modern Revolution of the Regulatory State
o Regulation means executive power
- Are federal administrative agencies part of the executive or legislative branches?
o don’t really know
- It is impossible to see an agency as part of Congress, but it is definitely connected to it.
- Conflict à Desire for less gov’t vs. Need for public services
- Carter à announced that he would clean up the regulatory system (blamed the economic recession on this)
o Deregulation – to abolish regulatory lag (make agencies more efficient). Thought this would reduce costs and put the US back in bounds economically
o This turned into aborition of regulation itself. Instead of making agencies more efficient, the actors made some agencies non-existent.
- Enter the ‘80s with an aggressive program in place by Carter
- Implemented by Reagan.
This tension is always there à there has never been a period of complete contentment.
Why have regulation at all?
- 1. Why not let Congress implement them by passing laws that they exist – letting the Courts enforce?