© 2010 pearson education, inc., publishing as prentice-hall 1 administrative law and regulatory...

© 2010 Pearson Education, Inc., publishing as Prentice-Hall© 2010 Pearson Education, Inc., publishing as Prentice-Hall 1

ADMINISTRATIVE LAW AND REGULATORY

AGENCIES

© 2010 Pearson Education, Inc., publishing as Prentice-Hall© 2010 Pearson Education, Inc., publishing as Prentice-Hall

CHAPTER 43 CHAPTER 43


Administrative Agencies

• Created by legislative and executive branches of federal, state, and local governments to assist in implementing and enforcing law.– E.g., federal SEC, state Environmental

Protection Agency, local zoning board.• Operation of agencies governed by

administrative law.


General Government Regulation

• Applies to businesses and industries

collectively.– E.g., NLRB oversees labor union and

management activity, – OSHA regulates safety and health

standards for workers,– Consumer Product Safety Commission

mandates safety standards for all products sold.


Specific Government Regulation

• Many industries are subject to specific regulation that regulates companies in that industry.– Banking (Federal Reserve)– Television (FCC)– Railroads (FRA)– Commercial airlines (FAA)– Food and drug companies (FDA)


Administrative Law

• Combination of substantive and procedural law.– Substantive law is the law that the agency enforces.

E.g., the Clean Air Act.– Procedural law establishes the rules that agency

must follow in enforcing the substantive law. E.g., notice, hearing requirements for issuing pollutant discharge permits.


Administrative Procedure Act

• Establishes certain administrative procedures that federal administrative agencies must follow.– E.g., notice and hearing requirements,– rules for conducting agency adjudicative actions,– procedures for rulemaking.

• Most states have enacted administrative procedural acts to govern state administrative agencies.


Administrative Law Judge (ALJ)

• Employee of the agency.• Presides over administrative proceedings.– Decides questions of law and fact.– No jury.– Issues decision in form of an order.– Any appeal of order goes first to agency for

review, then to appropriate court.


Delegation of Powers

• When agency is created, it is delegated certain powers (“delegation doctrine”).– Legislative powers– Executive powers– Judicial powers

• Unconstitutional for agency to act outside the scope of its delegated powers.


Delegated Legislative Powers

• Substantive rule making

• Interpretive rule making

• Issuing policy statements

• Granting licenses


Rule Making

• Federal agencies may issue substantive rules.– Have force of law.– Must be adhered to by covered persons and

businesses.– Violators may be held civilly or criminally

liable.– All substantive rules are subject to judicial

review.


Substantive Rule Making

• Must follow APA procedures:– Notice of proposed rules published in

Federal Register.– Interested parties given opportunity to

participate.• Informal rule making: Notice-and-comment.• Formal rule making: Agency conducts trial-like

hearing.

– Agency then announces final rule making.


Interpretive Rules

• Rules issued by administrative agencies that interpret existing statutory language.

• These rules do not establish new laws.

• Neither public notice nor public participation is required.


Statements of Policy

• Statement announcing proposed course of action that agency intends to follow in the future.

• These statements do not have the force of law.• Public notice and participation not required.


Licensing Power

• Statutes may require government license before a person can enter certain types of industries or professions.– E.g., banking, medicine.

• Agencies have power to determine whether to grant licenses to applicants; power to suspend or revoke licenses.

• Agency decisions subject to court review, but courts usually defer to agency’s expertise.


Judicial Power

• Authority to adjudicate cases through an administrative proceeding.

• Initiated when agency serves a complaint on a party for violation of a statute, administrative rule, or order.

• Must give procedural due process.– Proper and timely notice.– Opportunity to present evidence.


Executive Power

• Investigation and prosecution of possible violations of statutes, administrative rules, and administrative orders.

• May obtain information voluntarily or via administrative subpoena.– Can seek judicial enforcement if party fails to

comply.


Administrative Searches

• Agency may not conduct unreasonable search and seizure.

• Search is reasonable if:• Party voluntarily agrees, or• Agency has valid search warrant, or• Business or industry covered by warrantless

searches provisions.– E.g., liquor sales, firearms sales, coal mines.

• Evidence from unreasonable search and seizure is inadmissible in court.


Judicial Review of Agency Actions

• Decisions of federal agencies appealed to appropriate federal court.

• Decisions of state agencies appealed to appropriate state court.

• Party appealing agency decision is petitioner.


Appeal of Federal Agency Rule, Order, or Decision

AdministrativeAdministrative Law JudgeLaw Judge

(ALJ)(ALJ)

Federal Federal Administrative Administrative

AgencyAgency

U.S. District U.S. District CourtCourt

U.S. Court of U.S. Court of AppealsAppeals

U.S. U.S. Supreme Supreme

CourtCourt

Whether the appeal from the Federal Whether the appeal from the Federal Administrative Agency is to the U.S. Administrative Agency is to the U.S. District Court or the U.S. Court of District Court or the U.S. Court of Appeals is determined by the federal Appeals is determined by the federal law in question.law in question.


Disclosure of Administrative Agency Actions

• Public concern over possible secret agency actions induced Congress to pass several statutes that:– Promote public disclosure.– Protect parties from overly abusive agency

actions.


Freedom of Information Act

• Requires that most documents of federal administrative agencies be available to the public.

• Requires agencies to publish their proceedings, rules, regulations, and other information in the Federal Register.

• Specifies time periods for agency response to information requests, sets limits on copying charges, and provides for disciplinary action against employees who refuse to honor requests.


Freedom of Information Act (continued)

• Documents exempt from disclosure:– Those classified as in the interest of national

security.– Those that are statutorily prohibited.– Records whose disclosures would interfere with

law enforcement proceedings.– Medical, personnel, and similar information.– Papers containing trade secrets, confidential, or

privileged information.• All decisions not to disclose requested

documents are subject to judicial review.


Government in the Sunshine Act

• Requires that most meetings of federal administrative agencies be open to the public.

• Exceptions include meetings:– Where a person is accused of a crime.– Concerning an agency’s issuance of a subpoena.– Where public attendance would frustrate the

implementation of an agency action.– Concerning daily operations.

• All decisions not to close a meeting to the public are subject to judicial review.


Equal Access to Justice Act

• Protects private parties from harassment by federal administrative agencies.– Party subject to an unjustified federal

administrative agency action has right to sue. – May recover attorneys’ fees and costs.– Agency action complained of must be

outrageous to justify award.


Privacy Act

– Requires that federal administrative agencies maintain only information that is relevant and necessary.

– Must be needed to accomplish a legitimate agency purpose.

– Gives individuals access to records concerning them, and a right to correct these records.