2. Chapter #6- Agency Adjudication

3. When Agencies Make Decisions - Adjudications How is an adjudication different from a rule? –Rules apply to everyone in the affected class. –Adjudications decide questions in individual cases and only bind those parties. Parties to an adjudication are entitled to be heard. –Adjudications may include oral hearings. –Some adjudications are done on written documents only.

4. Adjudication should have some basic procedures (some but not all of below are required by US Sct.] 1.Timely & adequate notice; 2.Confronting adverse witnesses; 3.Oral presentation of arguments; 4.Oral presentation of evidence; 5.Cross-examination of adverse witnesses; 6.Disclosure to the claimant of opposing evidence 7.The right to retain an attorney; 8.A determination on the record of the hearing; 9.A statement of reasons for the determination & an indication of the evidence relied on; and 10.An impartial decision maker Informal Adjud. Does Not Require Many of These At all. Dictated by the US Sct. Case Goldberg

5. Informal Rulemaking Degrees of Formalities If APA is not pre-empted by certain enabling legislations of an agency (ie. APA rules are replaced with more specific ones), then APA Rule 553 “Rulemaking” rules apply to agency rulemaking procedures. Lets Review

6. If a court decides that an agency action falls in the rulemaking category, then, under Bi-Metallic’s reasoning, the Due Process Clause (5 th and 14 th amendments) DOES NOT come into play. An agency may, as far as the Constitution goes, simply announce rules following whatever discretionary informal procedure they wish!

7. If on the other hand…. If a court feels an agency action has some qualities of adjudication—that it speaks to a relatively manageable group of people whose participation might improve the quality of the decision making process— the courts say Due Process requires agencies to do something to insure fairness too the person or people affected.

8. The Legislature has the 1 st say… If an agency’s enabling legislation requires a formal hearing for either rulemaking or adjudication, then its this way or the highway! (ie. the administrative agency has no say in this matter) and the agency must follow the specific procedures in the APA (if not pre-empted by their specific enabling legislation) US Sct. Goldberg’s elements start to apply to gauge the adequacy of formality of adjudication…

9. 1. Timely & Adequate Notice APA provisions insure citizens learn the mechanics of the hearing in their case— when and where they will be heard. The essence of fair notice has to do with substance, the terms of the proposed rule and the matters of fact and law asserted in adjudication.

10. 2 nd, 5 th & 6th Goldberg items (Disclosure of Opposing Evidence & Opportunity to Confront and Cross Examine Adverse Witnesses All deal with proof of wrongdoing. The APA section 556(d) “A party is entitled to present his case or defense by oral or documentary evidence, to submit rebuttal evidence, and to conduct such cross-examination as may be required for a full and true disclosure of the facts.” Liberally interpreted by most ALJs.

11. 3 rd & 4 th Oral presentation of Arguments and/or Evidence APA does not necessarily permit claimants to present their position orally before an agency. Some formal hearings rules for agencies do allow for oral presentations if the parties’ insist. However, many allow the agency or ALJ to decide if there will be written or verbal testimony. Why can’t we all have oral hearings?

12. 7 th Right to an attorney Under “Miranda” the US Supreme Court interpreted the US Constitution to afford legal counsel if they were indigent in CRIMINAL CASES—BUT NOT CIVIL OR ADMINISTRATIVE CASES! Thus, usually there is a right to counsel, but not one that is provided to you free of charge—you have a right to hire (and pay) for your own in administrative proceedings! Attnys fees only Recoverable by Statute.. (American Rule)

13. 8 th & 9 th –Determination on the Record of the Hearing & Statement of Reasons and Material Evidence In formal trial-type hearings, agencies must satisfy courts that they have reached any given result on the basis of information formally presented on the record. (not from outside, off-record sources). The findings and decisions must pass muster under the “substantial evidence test” –by appeals courts reviewing ALJ/Commission members’ rulings. It is a test of reasonableness. This test requires LESS proof then “beyond a reasonable doubt” or “preponderance of the evidence”.

14. 10 th Impartial Decision Maker Generally a neutral, detached decision maker should be the ALJ or decision makers. However, most ALJs and decision makers are part of the agency and/or head it up! Dangers of impartiality also include pre-judgment and improper interest in the result.

15. JUDGE JUDY READY TO RULE---- Case: GIBSON VS. BERRYHILL Group of affected optometrists felt that The administrative decision making board was made up of private practice Optometrists interested in furthering the rule that prevented optometrists to work for Private companies and thus the entire board was prejudicial to their case (and this Same agency sought an injunction against the respondents in court b/f administrative Hearing. Thus, petitioners claim no neutral decision makers—violates Due Process Yes, Administrative Board made up of other Optometrists who would Benefit in the upholding of the Rule and charges, is Biased and this is a Violation of Due Process

16. JUDGE JUDY READY TO RULE---- Case: VENTURA V. SHALALA Petitioner for social security Disability benefits was denied benefits. Claimant feels this is due to the ALJ being prejudiced against him and his attorney and thus they Never had a fair hearing in violation of Due Process Denied Due Process. Yes, ALJ through His comments shows Disrespect to Claimant & Claimant’s Attorney And is not impartial

17. Pressures on ALJs Civil service protections –Can be fired –Can have salary lowered, but hard to do this –Can set work standards and discipline How are the pressures different than those on an Article III judge?

18. Protections for ALJs Civil Service protections Cannot be assigned subordinate duties and/or reduced responsibilities - Nash v. Bown, 869 F2d 675 (Cir2 1989) –Can have performance goals –Cannot have decisional quotas What if quality control guidelines are biased toward supporting the agency position?

19. Let’s Review! If authorizing statues call for a full hearing before a rule/regulation is passed by an agency, then the agency must follow the formal hearing requirements discussed in chapter 7. If a statute calls for something more than notice and comment but less than a formal hearing, as does the legislation governing the FTC, then the agency must do whatever the statute requires. If the authorizing statute is silent, then the agency must follow the APA section 533 notice and comment requirements unless one of the exceptions applies.

20. Its All About Due Process! 5 th Amendment vs. 14 th Amendment Substantive vs. Procedural Administrative vs. Judicial No Juries in Administration Proceedings! Less Formal Rules of Evidence In an Admin. Hearing