Document Type

Article

Publication Date

April 2009

Abstract

Section 554(a) of the Administrative Procedure Act provides that if a statute requires an agency an adjudicatory decision “to be determined on the record after opportunity for agency hearing,” that hearing will be subject to various requirements, including the use of an independent Administrative Law Judge, separation of the functions of investigation/prosecution and decision, and a prohibition on ex parte contacts. The courts of appeals have reached three distinct positions with respect to the question of when a statutory hearing requirement triggers § 554(a) of the APA. First, the First Circuit articulated a presumption that, for adjudications, a statutory hearing provision requires APA formal adjudication unless Congress has indicated the contrary. Second, the Seventh Circuit articulated the opposite presumption. Third, the D.C. Circuit and the First Circuit held that an agency’s interpretation of such a hearing provision qualifies for Chevron deference.

Professor Jordan argues that Chevron deference should not apply to these decisions because Congress would not have intended the courts to defer to an agency’s decision to avoid the requirements of formal adjudication. He suggests that the courts should recognize a presumption that Chevron deference does not apply to an agency’s decision applying § 554(a) to a particular statutory hearing requirement.

After the necessary background, his argument proceeds in two steps. First, he examines precisely what is at stake in the § 554(a) trigger decision. He demonstrates that courts, agencies, and commentators have been trapped in an analogy that treats APA hearings like civil trials, creating much concern about the burdens, delays, and costs of such proceedings. Professor Jordan shows that these concerns have been vastly overstated. APA §§ 554, 556, and 557 do not require trial-type procedure. They require the use of an independent ALJ and prohibit ex parte contacts and combination of functions. Beyond those essentials, the agency has vast discretion to control the mechanics of the hearing, from authorizing trial-type litigation to requiring much more informal and efficient process, subject to the requirement to allow cross-examination only “as may be required for a full and true disclosure of the facts.” Thus, what is truly at stake in deciding whether formal adjudication requirements have been triggered is whether the legitimacy and fairness of the proceeding will be protected by the three core limitations on agency power.

Second, Professor Jordan demonstrates that the APA Congress would not have intended judicial deference to this crucial procedural decision. He first establishes that the availability of Chevron deference depends upon congressional intent in the particular circumstances. He then traces the history of the struggle over agency power from 1929 to 1946, showing that the one thing all sides agreed upon was the need for independence, impartiality, and fairness as ultimately embodied in §§ 554, 556, and 557 of the APA. In § 554(a), Congress left the actual decision about the nature and availability of a particular hearing to a later enactment, but Congress would not have intended judicial deference to an agency’s decision that it was not bound by the core legitimizing provisions of the APA. Post-APA developments support that conclusion.

Publication Title

Administrative Law Review

First Page

249

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