Agency Adjudication under Administrative Law
Agency Adjudication under Administrative Law
1. Introduction
Agency adjudication refers to the process by which administrative agencies resolve disputes, enforce regulations, or decide rights through formal or informal hearings. It is a vital component of administrative law, as agencies often have both rulemaking and adjudicatory powers delegated by the legislature.
Unlike courts, agencies are part of the executive branch but act quasi-judicially when adjudicating disputes.
2. Types of Agency Adjudication
A. Formal Adjudication
Governed by the Administrative Procedure Act (APA) or similar statutes.
Resembles judicial trial procedures.
Requires:
Notice
Opportunity for hearing
Record of proceedings
Findings of fact and conclusions of law
Right to cross-examine witnesses
Used when the statute mandates a formal hearing (e.g., social security disability hearings).
B. Informal Adjudication
Less structured than formal.
May include negotiation, settlement conferences, or informal hearings.
No strict procedural requirements.
Often used in enforcement or licensing actions without explicit statutory formal hearing mandates.
3. Authority and Limits of Agency Adjudication
Agencies act under statutory authority; they cannot exceed this authority.
Decisions must comply with due process guarantees.
Agency adjudications can be reviewed by courts to ensure legality and reasonableness.
4. Key Elements of Agency Adjudication
Notice: The party must be notified of the charges or issues.
Hearing: The party must have a chance to present evidence, arguments, and confront adverse evidence.
Record: Proceedings must be recorded for review.
Decision: The agency must issue a reasoned decision based on the record.
Appeal/Review: There is usually a provision for judicial review of the agency’s decision.
5. Important Case Law
Goldberg v. Kelly, 397 U.S. 254 (1970)
Issue: Whether due process requires a hearing before termination of welfare benefits.
Ruling: The U.S. Supreme Court held that a pre-termination hearing is required, emphasizing the importance of fair procedures in agency adjudications affecting significant interests.
Significance: Established procedural due process requirements in administrative hearings.
Londoner v. City and County of Denver, 210 U.S. 373 (1908)
Issue: Whether a property owner is entitled to a hearing before a special assessment tax is levied.
Ruling: The Court held that when an agency adjudicates individualized interests, due process requires a formal hearing.
Significance: Distinguished between general rulemaking (legislative) and adjudication (individualized decisions).
Bi-Metallic Investment Co. v. State Board of Equalization, 239 U.S. 441 (1915)
Issue: Whether due process requires a hearing when a state agency raises property tax rates affecting many people.
Ruling: The Court held that in cases of general rulemaking affecting a broad class, no individual hearing is required.
Significance: Contrasted with Londoner, drawing the line between adjudication and rulemaking.
SEC v. Chenery Corp., 318 U.S. 80 (1943)
Issue: The basis on which an agency can justify its decision.
Ruling: The Supreme Court held that an agency's decision must be upheld, if at all, on the grounds invoked by the agency itself at the time of decision.
Significance: Reinforced the requirement for agency decisions to be reasoned and supported by the record.
6. Judicial Review of Agency Adjudications
Courts review agency adjudications on grounds such as:
Procedural fairness: Was due process followed?
Substantial evidence: Is the agency’s decision supported by substantial evidence in the record?
Arbitrariness: Was the decision arbitrary or capricious?
Ultra vires: Did the agency exceed its statutory authority?
7. Advantages and Disadvantages
| Advantages | Disadvantages |
|---|---|
| Expertise: Agencies have specialized knowledge. | Risk of bias: Agencies may be partial. |
| Efficiency: Faster resolution than courts. | Limited procedural safeguards in informal adjudication. |
| Flexibility in procedure. | Possible lack of transparency and accountability. |
8. Summary
| Aspect | Description |
|---|---|
| Definition | Process by which agencies resolve disputes and enforce laws |
| Formal Adjudication | Trial-like, governed by APA, with procedural safeguards |
| Informal Adjudication | Less formal, flexible procedures |
| Due Process | Requires notice, hearing, record, and reasoned decision |
| Judicial Review | Ensures agency decisions are lawful and reasonable |
| Landmark Cases | Goldberg v. Kelly; Londoner v. Denver; Bi-Metallic; Chenery |
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