Sample Answers to Final Exam
Spring - 1996
Prof. A. Michael Froomkin
The threshold fact to determine is whether this is a rule or can this action be interpreted to be an adjudication due to the tailoring of the application (see Vermont Yankee p. 508 quoting from Londoner v. Denver). I believe that this is a rule and not an adjudication because it is applicable to many people tourist, campers, tour operators, etc. and it is applicable equally to all of those similarly situated (see Bi-Metallic).
The next question to address is what does the enabling statute provide as to rule-making in terms of formal or informal procedures. In this regard we find that the statute has § 4(2) which requires that regulations be made after an opportunity for a hearing. This requirement in the statute it may be argued as being enough to trigger a formal hearing under the APA §§ 553 & 556. Ideally the statute would have stated that the rule be made "on the record after opportunity for a hearing." These requirements are elaborated in § 556 & 557.
An initial ground for attack would therefore be on whether the agency followed the proper procedure in passing the rule by complying with the APA requirements for formal rule-making. It seems from the facts given in the question that the formal hearing requirements were not followed in that there was no opportunity to conduct cross-examination and/or submit rebuttal evidence, etc.
The agency can argue that formal rule-making was not required by the statute citing U.S. v. Fla East Coast Railway that there is a strong presumption for informal rule-making. The agency is likely to prevail on this point.
There are other grounds for attack of this rule. First we will address the question of judicial review in light of the apparent limitation in §5. Is this a § 701(a) exception to judicial review. According to § 5 judicial review is available only when the rule is "nationwide in scope." The agency would argue that since the rule only applies to Oregon and Washington that there exists no judicial review. In Abbott Laboratories the Supreme Court expressed the "presumption of reviewability" of agency action. Congressional intent to preclude review has to be demonstrated by clear and convincing evidence. The statute specifically provides for judicial review of nationwide rules but is not clear and explicit in prohibiting review of rules which are not nationwide. In light of the presumption for reviewability § 5 would not preclude review in accordance with APA § 701 or common law principles.
The basis for review here will be that the agency acted beyond the scope of its authority in enacting the proposed rule. This would fall within APA § 706(2) (C). The actions the agency took in this regard are (1) redefining certain species of large mammals to the larger mammals of each species and; (2) redefining "take" to mean "giving, or attempting to give food." The argument will be that the court would review the rule because the agency has violated the statute in redefining the animals that will be covered and the broadening the scope of the statute to the feeding of animals (citing Overton Park).
This argument is that the agency is mis-interpreting the statute. In such cases we must analyze the agency's interpretation of the statute under the Chevron test. With regard to the first step the statute has not really addressed the issue of what is a large mammal so then we look to whether the agency's interpretation of what is a large mammal is "reasonable." Based on the deference principal of Chevron this part of the regulation is likely to pass the test.
The agency's interpretation of the "take" provision of the statute is another matter. The statute seems to have spoken clearly on what it means to "take" and thus this portion of the regulations seems to fail step 1 of the Chevron test. Our argument has to be then that the part of the regulations expanding the definition of "take" is impermissible by the statute. We will cite INS v. Cardoza-Fonseca for the proposition that the question of whether Congress intended for "take" to include "feeding or giving food" is a pure question of statutory constructions for the courts to decide. "The judiciary is the final authority on issues of statutory construction" Cardoza-Fonseca quoting Chevron p.731.
In my opinion we may be successful in defeating the rule which broadens the definition of "take" beyond that which is in the statute. My opinion is reinforced because of the imprisonment penalty provision of the statute. It would seem to me that only the congress can enact criminal laws and that the delegation of this power to the agency would be an unpermissible delegation.
Additional comments:
(1) The fact that the statute was re-passed in 1983 does not save the changes now proposed because it involves no acquiescence from Congress on these changes. Also if the statute is unconstitutional Congress' acquiescence is immaterial (see Chadha).
(2) With regards to the improper delegation of power and no clear standards specified in the statute, my opinion is that the court will read in reasonableness under the Amalgamated meat doctrine.
The action taken by the agency in each of these three circumstances was an informal adjudication. The Act does not require a hearing on the record so the adjudication is informal. The APA has no rules for informal adjudication (see page 335). Whether Alice, Bob and Carol have no right to a hearing must be determined on the basis of "due process" standard.
The fifth and fourteenth amendments provide that no person shall be deprived of life, liberty, or property `be preceded by notice and opportunity for hearing appropriate to the nature of the case.'" Cleveland Bd. of Education v. Loudermill quoting with approval Mullane v. Central Hanover Bank & Trust p. 321.
This due process standard requires "some kind of hearing" the form of hearing required is determined from a balancing of the competing interests at stake. The three part test is the (1) the interest of the claimant adjusted by, (2) the increased accuracy and (3) the increased burden or cost of the safeguard. In the language of Matthews v. Eldridge: (1) the private interest that will be affected by the official action, (2) the risk of an erroneous deprivation of such interest through the procedures used, and (3) the government's interest including the fiscal and administrative burdens that additional or substitute safeguards will entail.
The first step to take to balance the interests is to determine what kind of interest each of these individuals have. To have a property interest in a benefit, a person must have a legitimate claim of entitlement to it or a legitimate expectation of receiving such benefit. Board of Regents v. Roth. In each of the cases of Alice, Bob and Carol it seems that each of them have a legitimate claim of entitlement to the benefit so they meet the first criteria. We must next then determine "how much process is due". In the cases of Alice and Carol the interest involves life or death and thus triggers a pre-termination hearing Goldberg. Bob's case also involves life or death but since he was never allowed the benefits the hearing cannot be pre-termination. Nonetheless a hearing should be afforded within a reasonable time.
The provisions of § 46 of the Act which provides for a hearing at the sole discretion of the Secretary seems inadequate due to the interest here involved. This provision does not lead to a more objectively reasonable action and thus does not save the process or preclude the need for a hearing. Certainly the hearing required needs to be suitable for the determination to be in conformity with fundamental principles of justice. In this case Alice should be able to examine and rebut the evidence that she had non-disclosed additional income and whether that income put her over the maximum allowed. In Alice's case she probably is entitled to a trial-type hearing in order to be able to confront the evidence presented against her and test its credibility. Bob would have the opportunity to challenge the conclusion that he is not ill and that Frumious Malady is not an acute grievous and life threatening illness. This proof could, however, be submitted through documentary evidence since it would involve more of scientific conclusion than the challenging of anyone's credibility. Carol similar to Alice should have a trial type hearing to challenge the accusations that she was smoking and drinking and to challenge the credibility of the witnesses.
All three should be entitled to a right to counsel at their own expense and also to an impartial decision maker. This does not necessarily rule out an agency employee as the impartial decision maker unless there is an unacceptable risk of bias. The three are entitled to written statement as to the information and evidence relied upon in the determination.
These provisions will substantially increase the accuracy of the determinations made thus fulfilling the second test. The increased burden of these safeguards do not seem out of line since we are here dealing with the value of three lives.
In all three cases the procedural process must be enough to give a correct resolution to the dispute involved due to the magnitude of the interest (life or death). In short Alice, Bob and Carol should be given an opportunity to challenge the evidence against them during the hearing and be entitled to the full elements of a hearing as elaborated in Goldberg. That is (1) an impartial decision maker, (2) an opportunity to be heard, (3) opportunity to cross-examine, (4) no ex-parte or expostfacto fact finding, decision must be on the record, and (5) a written decision with reasons.
As an additional note this statute may perhaps be challenged on the basis that there are no clear standards and thus an improper delegation. The court using Amalgamate Meat doctrine would read reasonableness into the statute.
I would add a new Section § 554 (f) In any proceeding where an independent fact finder presides over a dispute (i.e. an ALJ) and takes evidence his findings of fact will not be overturned by the agency unless there was no reasonable basis for the findings to be made.
This new section is inserted to correct what I perceive as a problem in administrative law that the agency is given too much deference and reviewability is limited even with regards to findings of fact. This would be to correct the situation created by the application of the Universal Camera doctrine. In that case the court determined that the agency could overturn the hearing officer who had first hand impressions of the witnesses and was an impartial party to the proceedings. The court allowed this reversal and took the burden off the agency. In order to justify it's decision the agency only had to point to some evidence on the record which would support its conclusion. This is a subtly shift against a claimant who has already proven her case to an independent trier of facts.
In my opinion this unfairly reverses the burdens and puts the agency in an advantageous situation by allowing not only close decisions to go its way but by stacking the deck against any opposition to agency action. This is unfair particularly if the agency action is directed by the upper echelons of the agency and who are the ones to have virtually the final word on the appropriateness of the evidence and the case.
This change could possibly be enacted also by adding a new § 557(e) Findings of fact determined by an independent hearing officer will not be overturned unless his findings are determined to not be supported by the evidence.
In sum rather than determining that the agency's hierarchy's review of fact findings are entitled to more deference than that of an independent reviewing office I would change the rules. The burden should be on the agency to defend its findings against a challenge by an independent reviewing officer. The independent trier of fact should be entitled to more deference similar to the jury findings in a civil or criminal case.