General Rules for Agency Adjudications?

This article was authored by Matthew Lee Weiner, Vice Chair and Executive Director of ACUS.

This article first appeared in the Regulatory Review's series on "Improving Agency Procedure" that focuses on the ACUS Recommendations adopted at the June 2018 Plenary Session. Reposted with permission. The original may be found here, and the Regulatory Review's entire series may be found here.

The procedural rules governing civil cases in federal court rest on the principle of trans-substantivity, which holds that uniform rules should govern all types of cases, no matter their subject. That at least is the assumption on which the federal judiciary has generally proceeded in exercising its authority under the Rules Enabling Act to establish procedural rules for the courts.

Should the procedural rules governing agency adjudications also be uniform across agencies and for all types of cases? Could they be? To what end?

Congress has never provided for such uniformity in agency adjudications, and agencies have never made uniformity an objective. The Administrative Procedure Act (APA) does impose a number of important requirements on a small set of so-called formal adjudications—that is, trial-like proceedings whose most noticeable feature is that they must usually be held before an administrative law judge—and an even smaller number of requirements of relatively little consequence on all adjudications.

But the APA establishes nothing approaching a set of rules on the model of, say, the Federal Rules of Civil Procedure or the Federal Rules of Appellate Procedure. Rules governing adjudications have generally been established on an agency-by-agency basis and, within a single agency, often on a program-by-program basis, subject to limited constraints imposed by statute. Judicial review of agencies’ procedural rulemaking is minimal and deferential.

Enter the Administrative Conference of the United States (ACUS). In 1993, a working group commissioned by ACUS issued the Model Adjudication Rules to govern the proceedings in any “trial-type” agency adjudication—not just formal ones—“that offers an opportunity for an oral, fact-finding hearing.” Numerous agencies have used the Rules to design new, or revise existing, adjudicative programs. They include, most recently, the Consumer Financial Protection Bureau.

When ACUS resumed operations in 2010, after a 15-year hiatus, it placed administrative adjudication at the forefront of its agenda. ACUS has since adopted about ten formal recommendations, published numerous reports, and assembled a massive database in partnership with Stanford Law School on the subject. Several new adjudication projects—including one on the selection of administrative law judges and another on agency appellate systems—are underway. Much of this work will soon be featured in a forthcoming ACUS sourcebook written by Professor Michael Asimow, who guided the research for the database.

ACUS’s renewed attention to adjudication prompted it to revisit the 1993 Rules. In 2016, ACUS appointed a working group of a dozen distinguished members—adjudicators, agency lawyers, academics, private practitioners, and an analyst from the Federal Judicial Center steeped in federal rules reform—to review and revise the 1993 Rules. Two years of extensive deliberations and public input followed. Most of the drafting fell to the group’s academic reporter, Kent Barnett of the University of Georgia School of Law, who has done as much as anyone to renew scholarly attention in administrative adjudication.

Last month, the working group released its revised Model Adjudication Rules, which have since been noticed in the Federal Register. Much of the structure of the 1993 Rules remains intact, but they have been thoroughly revised and, thanks, to Barnett, rendered in clear English. The revisions reflect changes in adjudicative practice since 1993, recent amendments to the Federal Rules of Civil Procedure, and especially ACUS’s recommendations, reports, and research since publication of the 1993 Rules. That research was supplemented by agency responses to detailed survey questions.

The revised Rules are intended to govern the proceedings—from initiation to pretrial proceedings to hearing to hearing-level decision to final agency appeal—of any agency adjudication that entails a “trial-type proceeding…that offers an opportunity for fact-finding before an adjudicator, whether or not an administrative law judge.”

That definition by no means covers most agency adjudications. Most adjudications little resemble trial-like proceedings—so much so that many lawyers would probably not recognize them as adjudications at all—even when they adjudicate important interests. (An excellent typology of adjudication, now gaining currency in the academic literature, appears in Asimow’s 2016 report for ACUS and ACUS Recommendation 2016-4.)

But the Rules’s definition of “adjudication” does sweep broadly. It covers both formal  adjudications and a still much larger class of other adjudications (often misleadingly labeled “informal”) under hundreds of programs at hundreds of agencies presided over by well over ten thousand adjudicators who go by at least a dozen different titles other than “administrative law judge.” There are, by contrast, fewer than seven hundred authorized federal district court judgeships.

To return to the questions with which I began: Can the Rules be applied to all of these adjudications? Should they be? And to what end? The reporter’s preface answers “yes” to the first two questions—declaring that the working group “encourages” agencies to adopt the Rules “in toto”—and, as for the third, notes simply that the Rules’ “purposes” are “to simplify and render more consistent agency procedural rules.”

Those statements are qualified, however, by the recognition that agencies could adopt the rules “in toto” only after “accounting for the agency-specific matters” that the Rules comments identify. Some agencies, the preface adds, may “not wish” to or may be “unable” to adopt them “in toto” at all, but rather adopt just “individual rules” or simply use them as “guides.” (The preface does not explain why cross-agency “uniformity” and “consistency” are in themselves desirable ends. I, for my part, am unconvinced that they are.)

Such qualifications are necessary because, despite the aspirations for consistency and uniformity that the preface attributes to the working group, few if any agencies could adopt the rules in their entirety, and few should want to do so—even if, as is often the case, program-specific statutes leave their procedural choices largely unconstrained. The reason, simply put, is that adjudication programs vary too much in important ways, both across agencies and often within a single agency—an obvious, but too often overlooked point, in administrative-law scholarship.

Adjudications vary both in the forms they take—there is and can be no, to borrow from Rule 1 of the Federal Rules, “one form of action” in agency adjudication—and especially in the substantive ends they serve. Each procedural system must be carefully designed to serve those particular ends. Each system must also find the optimal balance between sometimes competing objectives (often said to come down to efficiency and fairness) in deciding what and how much process to give. Hence agencies will give different answers to such questions as whether to provide for pre-hearing discovery (and if so, what discovery), pre-hearing summary dispositions (and, if so, what kinds), and interlocutory appeals (and if so, when and how).

And in fact the Rules largely reflect as much. Many of the rules leave placeholders to account for program-specific considerations, and most of the excellent reporters’ comments accompanying each rule direct agencies to ask exactly the sorts of questions I pose above before settling on any particular language. The comments recognize, in short, that agencies could not adopt the Rules “in toto.”

That by no means deprives the Rules of value to agencies. Much to the contrary. The Rules offer an invaluable and much-needed guide to agencies for how to draft new rules and, more importantly, how to review and revise their existing rules, as the U.S. Securities and Exchange Commission, the U.S. Department of Labor, and other agencies have recently done.

The Rules do so in four related ways: first, by identifying the important questions to which agencies must attend, even if they will be answered differently by different agencies; second, by identifying the key options that agencies have in answering those questions; third, by identifying certain principles, beyond those reflected in the APA and most other statutes, to which every agency should adhere in its adjudications; and fourth, by offering model language that can guide rule drafting once the key choices have been made.

Perhaps the Rules will also provide an all-too-necessary reminder to agencies: whenever possible, their procedural rules should be developed prospectively rather than in a slipshod, case-by-case manner, and, once developed, these rules should be set down in published regulations rather than relegated to internal guidance documents or, worse, left unwritten. That alone would be a worthwhile contribution for which the working group should be applauded.