The Basics of Administrative Law

THE BASICS OF ADMINISTRATIVE LAW

Introduction:

Administrative law is the area of law that relates to the legal principles governing the administration and regulation of federal and state government agencies. It is considered a branch of public law and commonly called “regulatory law.” Decision making in the daily activities of various federal and state agencies is governed by administrative law and the areas covered range from protection of the environment to protection of worker’s rights and privileges. As the size of both federal and state governments expanded, the matters subsumed within administrative law expanded equally to the point where of us, whether in our personal lives or business lives, are subject to the decisions and tribunals of administrative agencies on a constant basis.

Consider: every licensing agency; all environmental laws; all building departments and consumer protection agencies; all zoning, land use, and control of media, news outlets, immigration, worker safety, etc. are all essentially run by administrative agencies subject to administrative law. As one elderly administrator once told the author, “Everyone looks at the courts as setting standards and the rules. Nope. Almost all the time it’s us, the people in the administrative agencies.”

And to know how they operate and what legal restrictions exist upon them is essential for anyone living, working, or running a business in the United States. That is the subject of this article.

The Basic Laws that Apply:

Most government agencies in the United States are established under the executive branch of government. The executive branch is led by the president and it controls the federal executive departments, which are led by secretaries who are members of the President’s Cabinet. Even though many of the important independent agencies of the federal government created by statutes enacted by Congress exist outside of the federal executive departments, they remain part of the executive branch of the government. Administrative law provides the legal basis as to the functioning of these agencies and departments and seeks to establish efficient procedures and methods.

Usually, administrative agencies adjudicate minor and complex disputes more quickly with less procedural complications than courts. The hope is that adjudication by administrative agencies helps to preserve judicial resources and promote quicker resolutions. This is questionable. As part of an agencies’ adjudicative function it can obtain relevant information by way of subpoena, inspection or by compelling the filing of reports and testimony.

On the State level, administrative agencies act for the governor or, at times, the mayor and perform essentially the same functions as the federal agencies, but on a state or local level.

1. INVESTIGATION BY AGENCY

An administrative investigation is an attempt to develop information to identify facts, or to determine an appropriate course of action within requirements established by laws, and regulations. The basic purpose of an investigation is to gather data, evidence, facts, and statement to assist in determining whether an incident occurred or did not occur as alleged or whether a problem is unique or requires alteration of methods.

Three main ways to obtain information in an administrative investigation are:

1. Subpoena

An administrative subpoena is an official order which requires an individual or entity to provide an administrative agency documents or information. Statutes provide administrative agency power to issue subpoena. Often, surprisingly, agencies have no power to enforce subpoenas. Courts alone can enforce subpoenas. So, agencies file court actions for enforcement of subpoenas issued by an administrative agency. Some states granting subpoena power to administrations indicate that penalty for disobeying a subpoena is a misdemeanor, and some states provide that disobeying a subpoena is punishable as contempt of district court. If a statute granting subpoena power does not specify a penalty for violation, the general rule is that it is contempt of court to violate a lawful subpoena and may subject the violator to judicial punishment or fine.

When an administrative agency subpoenas corporate books or records, the fourth amendment of the constitution (as to reasonable search and seizure) requires that the subpoena be of limited scope, relevant in purpose, and specific in directive. Compliance of subpoena should not be unreasonably burdensome. Donovan v. Lone Steer, 464 U.S. 408 (U.S. 1984).

2. Compel Filing of Reports

An administrative agency can compel parties to file reports. Complainants file petitions to compel another party to file reports on issues connected with the dispute.

When a party does not produce some documents claiming a privilege or fails to comply with an order of administrative agency to produce certain reports, the administrative agency can compel the party to produce the reports before the agency.

Administrative agencies can compel report filing when information sought can be reasonably obtained only from opposite party, and the opposite party has refused to provide the information voluntarily. However, the information sought should have probative value in the matter of dispute.

3. Inspection

An administrative inspection is inspection of business or other premises conducted by authorities for obtaining information. In the Federal context, administrative inspection is initiated and conducted only by federal agency officials. A party can submit a request to authorities to inspect for discovery of information related to the dispute. However, the administrative agencies only conducts the inspection if it is satisfied that the information required can only be obtained through inspection by the authorities.

The fourth amendment to the United States Constitution protects individuals against “unreasonable searches and seizures.” That amendment specifically requires searches to be sanctioned by judiciary and supported by reasonable cause. The fourth amendment’s restrictions on unreasonable searches and seizures are not limited to criminal investigations but also apply to administrative inspections. Donovan v. Dewey, 452 U.S. 594 (U.S. 1981). However, legislative processes authorizing warrantless administrative searches of commercial property do not automatically violate the fourth amendment.

 

THE COURTS AND THE AGENCIES.

Administrative law is a body of law that controls administrative activities of government agencies. An administrative agency is a permanent or semi-permanent branch of the government that is responsible for management and administration of specific functions.

Note that an administrative agency is not a part of the United States judicial system though they may7 be subject in various circumstances to judicial review. Courts and administrative agencies are independent. Their functions also differ. Statutes have delegated administrative agencies executive power to administer legislative authority. The primary function of administrative agencies is to exercise the executive power delegated to them by statute.

The administrative scheme should achieve “rational process flow through which results are determined.” In Harrison v. Ginsberg, 169 W. Va. 162 (W. Va. 1982) it was held that every final judgment provided by an agency in a case shall be in writing or stated in record, and shall be accompanied by well reasoned fact findings and conclusions of law.

Note that the administrative system substitutes administrative agencies for courts in making many decisions in the federal agencies. Such administrative agencies also determine definition of individual rights in administrative systems. However, there can be Court review of administrative decisions. For example, in Benedict v. Bd. of Police Pension Fund Comm’Rs, 35 Wn.2d 465 (Wash. 1950), a police officer’s 12-year-old son found the officer’s gun and pointed it at him while the officer was sitting at his kitchen table. On seeing his wife’s face, the officer turned around when his son discharged the gun, and killed him. The officer’s widow filed an application for a pension. The Board denied the application on grounds that husband was not actually engaged in performance of his duties as a police officer when he was shot. The officer’s widow requested an appeal to the court from the board. The court observed that in determining a question the board should have considered all available information and facts. The board was not limited to the widow’s testimony, but could consider the entire record and draw conclusions from all the evidence before it. The court concluded that the officer was performing his duty as a police officer in preventing his son from firing, and hence, his widow was eligible for pension.

Generally, administrative procedures are less complex and legalistic than judicial procedure. Such proceedings, however, are bound by basic evidentiary limits. Ruffin v. Clinton, 849 S.W.2d 108 (Mo. Ct. App. 1993). Note that strict rules of evidence do not necessarily apply to administrative proceedings while they must in a court of law.

According to the Seventh Amendment of the US Constitution, in lawsuits where the value in controversy exceeds a specified amount the parties are entitled to demand a jury trial in an action for damages. Curtis v. Loether, 415 U.S. 189 (U.S. 1974). However, the right preserved by the Seventh Amendment is not applicable in administrative proceedings.

Administrative agencies can either be agents of the executive or independent agencies. Administrative agencies cannot be considered courts but can act as quasi-judicial bodies when the statute permits.

The Administrative Procedures Act of 1946 (APA) 5 U.S.C.A. § 551 [1982] sets standards for the quasi-judicial power of the administrative agencies. The APA also provides authority to Administrative Law Judges (ALJs) in exercising the decision-making power. This quasi-judicial power of the administrative agencies encourages quick decision makings in relatively minor or exceedingly complex disputes.

The decisions of administrative agencies can be reviewed by the state or federal courts if the administrative agency does not comply with the required due processes, if the parties involved are not given the opportunity for full and fair hearing or, if there is any abuse of discretion. Usually, before suing in civil court, the parties must exhaust all appeals within the agency.

Courts will also determine if the administrative agency exceeded its law making or judicial power and for this purpose the court will examine the agency’s records. This type of judicial reviewing by the courts tends to eliminate the flexibility of the administrative agencies in resolving actions and in disputes. Therefore, to avoid this difficulty, most of the enabling statutes for administrative agencies are worded broadly to enable the administrative agencies to exercise wide discretion in decision making. In Delta Found. v. United States, 303 F.3d 551, 560 (5th Cir. Miss. 2002), the United States Court of Appeals for the Fifth Circuit held that there are wide differences between administrative agencies and courts thus it is difficult to determine if they can be compared to the relation between upper and lower courts.

THE ADMINISTRATIVE PROCEDURE ACTS:

FEDERAL:

Administrative Procedure Acts are legislation designed to give uniformity to the rule making and adjudicative proceedings of the administrative agencies both in federal and state level. The federal government passed the Federal Administrative Procedure Act (APA) act in 1946, in response to increasing resentment of the agencies’ scope in matters that affects the rights of individuals. Following the federal lead, most of the states also passed similar statutes during the late 1940s and early 1950s.

The APA embodies a comprehensive regulatory scheme that governs aspects such as investigations, adjudications (5 USCS § 554), rulemaking (5 USCS § 553ii), and licensing, open meeting and disclosure requirements of federal agencies. The Act also guarantees the right of judicial review to any person suffering legal wrong because of any agency action. Under the APA, all agency action is either rulemaking or adjudication. Its emphasis on transparency, fairness, and access to the courts has resulted in the accountability, efficiency, and acceptability of the decision making of government.

The APA embodies comprehensive regulatory scheme that governs aspects such as investigations, adjudications, (5 USCS § 554) rulemaking (5 USCS § 553ii), and licensing, open meeting and disclosure requirements of federal agencies. The Act also guarantees the right of judicial review to any person suffering legal wrong because of any agency action.

The basic purposes of the APA are:

• to require agencies to make the public informed about their organization, procedures and rules;
• to provide public participation in the rule making process;
• to establish uniform standards for the conduct of formal rulemaking and adjudication;
• to define the scope of judicial review.

Generally, statutes enacted after the Act cannot supersede or modify its provisions. However, an agency has the discretion to afford parties with procedure that is more than required by the Act. The provisions of the Act are not violative of the Fourteenth Amendment to the United States Constitution.

CALIFORNIA:

The California Administrative Procedure Act (“Act”) is found in Title 2, Division 3, Part 1, Chapter 3.5, 4, 4.5 and 5 of the Government Code of California. The Act established the office of administrative law (“office”) in the state government. The direction and control of the office will be on an executive officer called the director. The director will be appointed by the governor subject to the confirmation of the Senate. The director will have the same qualification as that of a hearing officer.

Cal Gov Code § 11340.6 provides that if not restricted by a statute, any interested person can petition a state agency for adoption, amendment or repeal of a regulation. The petition must clearly state the substance and nature of requested action, reason for the request and authority of the state agency to take the action requested. Within 30 days of the receipt of the request, the agency can grant or deny the petition in part, can grant any other relief or take any other action.

According to Cal Gov Code § 11342.1, an agency can adopt, administer or enforce a regulation only if it is within the scope of authority conferred on it by other provisions of law. No regulation is valid unless it is consistent and not in conflict with the statute conferring authority to the agency.

Cal Gov Code § 11343 provides that every agency must file a copy of regulation adopted, amended or order for repeal of a regulation with the secretary of state. A regulation or order of repeal will become effective on the 30^th day after the date of filing. It can become effective on another date if the regulation is adopted pursuant to a statute and the statute specifically mentions another date. If the agency prescribes another date in the instrument filed together with the regulation or order of repeal or makes a written request to the office for an earlier date demonstrating a good cause, then also effective date can be changed.

According to Cal Gov Code § 11344, the office must provide for official compilation, printing and publishing of the adoption, amendment or repeal of regulations. This compilation is known as the California Code of Regulations or California Administrative Code. The publication containing the weekly updates and the amendments in the California Code of Regulations is called the California Code of Regulations Supplement or California Administrative Code Supplement or California Regulatory Code Supplement. The office must also provide for the publication of California Regulatory Notice Register or California Administrative Notice Register, which will be an official publication of the State of California which will contain notice of proposed action and summary of all regulations filed with the secretary of state.

Cal Gov Code § 11346.4 every agency must give notice of the proposed action to persons who have filed request for notice at least 45 days prior to the date of public hearing. After the action is completed and approved by the office, no further adoption, amendment, or repeal to the noticed regulation can be made without giving a subsequent notice. The notice of the proposed action must include the following:

1. Details of time, place, and nature of proceedings for the proposed action;
2. Indication as to the authority under which the regulation is proposed;
3. A reference to the code, sections or other provisions of law that are being implemented, interpreted, or made specific;
4. An informative digest drafted in plain English in a format like the Legislative Counsel’s digest on legislative bills.

Every agency must keep rule-making records on all of agency’s pending rule-making actions, in which notice is published in the California Regulatory Notice Register. The office must review all regulations adopted, amended, or repealed and submitted to it for publication in the California Code of Regulations Supplement and for transmittal to the Secretary of State. The determinations of the office will depend on necessity, authority, clarity, consistency, reference and non-duplication.

The agency must make a written request for review of the decision of the office with the Governor’s Legal Affairs Secretary within 10 days of receipt of the written opinion provided by the office. The request must also contain a statement as to why the agency feels that the decision is incorrect.

According to Cal Gov Code § 11349.7, the office, can initiate a priority review of any regulation, group of regulations, or series of regulations that the committee believes does not meet the standards set forth in the Act. This can be done at the request of any standing, selected, or joint committee of the Legislature.

Cal Gov Code § 11350 provides that any interested person in accordance with the Code of Civil Procedure, can seek judicial declaration as to the validity of any regulation by bringing an action for declaratory relief in the superior court. Further, any interested person can obtain a judicial declaration as to the validity of a regulation or order of repeal which is disapproved by the office or of a regulation that has been ordered repealed. The person can obtain judicial declaration by bringing an action for declaratory relief in the superior court in accordance with the Code of Civil Procedure. The court can declare the regulation valid if it determines that the regulation meets the standards set forth in the Act and that the agency has complied with the procedures. In that case, the court can order the office to immediately file the regulation with the Secretary of State.

According to Cal Gov Code § 11415.60, pursuant to an agreement of the parties, an agency can formulate and issue a decision by settlement, without conducting an adjudicative proceeding. If there is consent of the parties, the agency can also refer the dispute for resolution by mediation or arbitration.

Cal Gov Code § 11445.20 provides that an agency can use informal hearing procedure, if in the concerned circumstance, use of informal hearing does not violate another statute or the federal or state Constitution. An informal hearing can be used in the following proceedings:

1. If there is no disputed issue of material fact;
2. If there is disputed issue of material fact but the monetary amount is not more than thousand dollars ($ 1000);
3. A disciplinary sanction against a student that does not involve expulsion from an academic institution or suspension for more than 10 days;
4. A disciplinary sanction against an employee that does not involve discharge from employment, demotion, or suspension for more than 5 days;
5. A disciplinary sanction against a licensee that does not involve an actual revocation of a license or an actual suspension of a license for more than five days;
6. If the agency is authorized by a regulation to use informal hearing in a proceeding; or
7. A proceeding where an evidentiary hearing for determination of facts is not required by statute but required by the federal or state Constitution.

According to Cal Gov Code § 11460.20, an agency can issue an emergency decision for temporary, interim relief, if the agency has adopted a regulation that provides that the agency can use the emergency procedure under the Act. An emergency decision can be issued only if there is imminent danger to public health, safety and welfare. The agency can take only that decision which is necessary to avoid the immediate danger and justifies the issuance of an emergency decision.

Cal Gov Code § 11465.10 provides that an agency can also conduct an adjudicative proceeding under the declaratory decision procedure provided under the Act. A person can apply for a declaratory decision regarding the applicability to specified circumstances of a statute, regulation, or decision within the primary jurisdiction of the agency. The agency in its discretion can issue a declaratory decision in response to the application. But if the issuance of the decision would be contrary to a regulation adopted under the Act, then the agency cannot issue a declaratory decision. If the declaratory decision would substantially prejudice the rights of a person who would be a necessary party and does not give written consent to settle the matter by a declaratory decision proceeding or if the decision involves a matter that is the subject of pending administrative or judicial proceedings, then also agency cannot issue a declaratory decision.

If a state statute or federal regulation applicable to an agency or decision is conflicts with any provision of the Act, then that state statute or federal regulation prevails over the Act. A person can waive a right conferred on him/her by the administrative adjudication provisions of the Act.

Conclusion:

As the size of the Federal and State governments increased both in terms of duties undertaken and size of the budget and staff, the growth of administrative agencies and the law pertaining to them also increased.  While the Courts have sought to keep due process requirements in force within the Agencies, and while the legislature does impose some restrictions on their actions, a remarkable amount of regulations and requirements exist that derive from these institutions. Any person seeking to understand the likely restrictions that may be imposed by the government or who seeks permission to perform various actions will soon encounter the need to master the knowledge as to what agencies control the area and what law is applicable to them.