15.4 Judicial Review

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15.4 JUDICIAL REVIEW

15.401 In General.

The Administrative Process Act governs judicial review of agency actions covered by the Act. ⁸⁸⁸³ In general, the Act places judicial review of administrative agency decisions in the circuit courts, with appellate review by the Court of Appeals, and, in rare cases, additional appellate review by the Virginia Supreme Court. Certain limitations on judicial review are stated in the Act, and some agencies are governed by specific judicial review provisions placing review of their decisions directly in courts other than the circuit courts. ⁸⁸⁸⁴

15.402 Exemptions.

The following five types of agency actions are exempt from judicial review under the Administrative Process Act:

1. Agency actions placed beyond the courts' control by constitutional or statutory authority;

2. Actions that involve only an agency's internal management or routine;

3. Decisions resting completely on an inspection, test, or election, except when the agency lacks the authority to conduct that procedure or conducts it arbitrarily;

4. Decisions in which an agency acts as an agent for a court; and

5. Agency actions that encompass matters subject by law to a trial de novo in any court. ⁸⁸⁸⁵

Judicial review under the Act is available from agency decisions granting or denying Temporary Assistance for Needy Families, Medicaid, food stamps, general relief, auxiliary grants, or state or local hospitalization. However, certain limitations on the appeal of these kinds of decisions apply. ⁸⁸⁸⁶ For example, no person may bring an appeal regarding the adequacy of the standards of need or sufficiency of payments of public assistance. The court may not review the validity of any federal or state statute, regulation, standard, or policy that served as the basis for an agency's decision, and no intermediate relief may be granted under section 2.2-4028. ⁸⁸⁸⁷

Judicial review of public assistance determinations must be based solely on the agency's record, and the reviewing court's inquiry is limited to determining whether there was evidence in the record to support the decision. If the court finds in favor of the party complaining of the agency's action, it may reverse its decision and remand the matter to the agency for further proceedings.

15.403 Circuit Court Review.

A. In General.

Section 2.2-4026 of the Virginia Code provides that any person (i) affected by and claiming the unlawfulness of a regulation or (ii) aggrieved by and claiming the unlawfulness of an agency case decision has a right to direct review of the agency's action by "appropriate and timely court action" against the agency, or its officers or agents, as provided by the Rules of the Supreme Court of Virginia. ⁸⁸⁸⁸ Where such an action is based on an agency's alleged failure "to follow any procedure for the promulgation or adoption of a regulation," the complaining party must prove that the regulation is unlawful by a preponderance of the evidence. ⁸⁸⁸⁹ If the court finds in favor of the complaining party, it will declare the regulation void and remand the case to the agency. For purposes of determining the timeliness of a notice of appeal from a regulatory action, the 30-day period begins to run from the date of publication of the regulation's adoption or readoption in the Register of Regulations. ⁸⁸⁹⁰ The purpose of section 2.2-4026 is to "standardize court review, . . . save as laws hereafter enacted may otherwise expressly provide." ⁸⁸⁹¹

B. Sovereign Immunity.

Under the doctrine of sovereign immunity, the Commonwealth cannot be sued unless—and only to the extent that—it waives immunity expressly by statute. ⁸⁸⁹² Courts must construe a purported waiver of sovereign immunity narrowly, ⁸⁸⁹³ and actions against state agencies constitute suits against the Commonwealth requiring strict compliance with the statutes authorizing those actions. ⁸⁸⁹⁴ The Administrative Process Act contains some specific waiver provisions. ⁸⁸⁹⁵ For example, the Act waives the sovereign immunity of the Virginia Board of Medicine with respect to the board's written, or promulgated, rules and case decisions as defined by the Act. ⁸⁸⁹⁶ If an agency's basic law expressly subjects certain agency proceedings to judicial review under the Act, agency proceedings not mentioned in that basic law are also subject to the Act unless they are expressly excluded by the Act itself. ⁸⁸⁹⁷ Conversely, because it does not expressly include the state agencies within the definition of "persons" subject to its relevant provisions, the Virginia Fraud Against Taxpayers Act ⁸⁸⁹⁸ does not subject state agencies, including state universities, to civil investigative demands. ⁸⁸⁹⁹

Pursuant to the Administrative Process Act and the Rules of the Supreme Court of Virginia, circuit courts have the power to review agencies' case decisions. ⁸⁹⁰⁰ Part 2A of the Rules governs appeals brought under the Act. The Virginia Supreme Court has ruled that the requirements of Part 2A are mandatory and jurisdictional. ⁸⁹⁰¹ Accordingly, failure to comply with the requirements of Part 2A could cause dismissal of the appeal. ⁸⁹⁰²

C. Exhaustion.

The Court of Appeals has ruled that, before seeking judicial review, a party must try to find relief through available administrative procedures and final case decisions. ⁸⁹⁰³ It remains unclear what may constitute a "final" case decision. State administrative agencies frequently issue notices of violation advising a permittee, operator, or other responsible party of a potential violation of permit terms, statute, or regulations. A notice of violation also identifies the remedial action required and sets deadlines for compliance. ⁸⁹⁰⁴ A notice of violation usually states that it does not constitute a final case decision, and parties can request an informal fact finding conference and, ultimately, a formal hearing before the agency regarding the alleged violation or violations. There is authority for the proposition that a notice of violation may be an appealable final action. ⁸⁹⁰⁵ The failure of a party to file a motion for reconsideration under section 2.2-4023.1 does not constitute a failure to exhaust all administrative remedies. ⁸⁹⁰⁶

D. Standing.

The provision that a person must be "affected by" an agency regulation or "aggrieved by" a challenged agency action imposes a standing requirement. The Virginia Supreme Court has indicated that an association organized to protect the interests of individuals who would be entitled to bring suit in their own right may not have standing to bring suit in its representative capacity unless it can demonstrate that it is "aggrieved" by the agency action or the action is authorized by statute. ⁸⁹⁰⁷ An agency's basic law may also include standing requirements that supersede those of the Act. ⁸⁹⁰⁸ Generally, in order to have standing to seek judicial review of an agency decision in circuit court, a party must plead and prove that he or she has been "aggrieved" by the decision; ⁸⁹⁰⁹ a party does not have standing by asserting a perceived public right or to redress an anticipated public injury when the only wrong the party has suffered is in common with other members of the public similarly situated. ⁸⁹¹⁰ Rather, the party must show an "immediate, pecuniary and substantial interest in the litigation, and not a remote or indirect interest." ⁸⁹¹¹

Nevertheless, some agencies, such as the State Water Control Board, adopt the requirements for standing under Article III of the United States Constitution in place of those set forth in section 2.2-4026 of the Virginia Code. ⁸⁹¹² Pursuant to the somewhat more lenient Article III standing requirements, a party has standing to appeal an agency decision if the party has participated in the public comment process related to the decision and (i) has suffered an actual or imminent injury that is an invasion of a legally protected interest and that is concrete and particularized; (ii) the injury is fairly traceable to the action of the agency and does not result from the independent action of a third party; and (iii) the injury is redressable by a favorable decision of the court. The Court of Appeals of Virginia has interpreted this standard to find that public interest groups have "representational standing" to sue on behalf of their members if the group has participated in the public comment process. ⁸⁹¹³ An environmental interest group alleged injury-in-fact sufficient for Article III standing when members of the group averred that they use the affected area and are persons for whom the aesthetic and recreational values of the area will be lessened by the challenged activity. ⁸⁹¹⁴

E. Perfecting an Appeal.

Rule 2A:4 of the Rules of the Supreme Court of Virginia sets forth the procedures for perfecting an appeal of an agency decision to circuit court. Those procedures are substantively identical to the procedures applicable to the appeal of any circuit court decision to the Court of Appeals or the Supreme Court of Virginia. To perfect an appeal, a party must file a notice of appeal with the agency secretary within 30 days of adoption of the challenged regulation or service of the final order in the case decision. ⁸⁹¹⁵ For purposes of determining the timeliness of a notice of appeal from a regulatory action, the 30-day period begins to run from the date of publication of the regulation's adoption or readoption in the Register of Regulations. ⁸⁹¹⁶ The notice must identify the regulation or case decision appealed, state the names and addresses of the appellant and other parties and their counsel, if any, specify the circuit court to which the appeal is taken, and include a certificate stating that a copy has been mailed to each party's counsel or registered agent. The notice must be served on the agency secretary; mailing to agency counsel will not suffice. ⁸⁹¹⁷ If a formal hearing was held, the appellant must deliver a...