CHAPTER 2 ADMINISTRATIVE ACTIONS
| Jurisdiction | United States |
(Nov 1981)
ADMINISTRATIVE ACTIONS
Covington & Burling
Washington, D.C.
Administrative law has been recognized by the American legal profession as a separate legal discipline — a subject for legal study and discourse separate from other legal subjects — for no more than two, perhaps three generations. It was only 65 years ago that Elihu Root in his presidential address to the American Bar Association urged the members to develop a "system of administrative law."1
In the intervening years we have indeed seen the development of a system of administrative law, which I take to be the law that governs the relations of private persons to agencies of government. Administrative law partakes of other branches of law — constitutional law, contracts, torts — but it is separate and different from any of them.
Full acceptance of this branch of the law has come even slower than recognition of its separateness. It has not really come yet. In 1920, my late partner John Lord O'Brian gave an address before the Maryland State Bar Association that he called "The Menace of Administrative Law."2 He was moved to denounce what he viewed as current excesses in alien deportation proceedings. But he generalized: "Administrative government is not responsible government; every attempt to enlarge its scope should be viewed with jealous scrutiny."3 And he concluded:
"It is not the work, the zeal or the errors of public officials now in office that matters so much; it is the fact that without remonstrance we are tolerating practices and lending the countenance of approval to theories of law which in the long run can only have the result of undermining the judicial power, — the last repository of the liberties of the Americans."4
The idea expressed by Mr. O'Brian that judges are more to be trusted than bureaucrats is a persistent one among lawyers. One manifestation of the idea, the modern law of judicial review, is the subject of another paper in this Institute. Another manifestation is the tendency of some
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lawyers who practice before, or at any rate know, the courts to regard those of us whose practice is before agencies as something less than full-fledged lawyers. It is not becoming for me to deny that the disdain is merited. All I can say is that there is at least a kind of curiosity about what we do that shows forth in such things as this Institute, and that I shall try, within the limits of the topic assigned to me, to satisfy it.
The curiosity is a good thing. For, if acceptance of administrative law has come slowly, understanding also lags. Not long ago, for example, I participated in a seminar at which a distinguished United States Senator expressed at some length his concern over what he described as the large number of important governmental decisions that are being made by administrative law judges. I could understand his expression of concern if it were uttered, say, 20 or 30 years ago — whether I shared it or not. Today, however, in many of our important federal agencies there is a dearth of work for administrative law judges. Administrative law judges continue to decide a lot of cases, but these days the governmental decisions that you read about in the newspapers, the decisions that are important to persons other than the parties, are mostly made elsewhere. Today's administrative law issues are not yesterday's.
My subject is federal administrative law. Some but not all of what I have to say can be transferred to the practices of some or all of the states, but I can give no guarantees on that score. I shall describe various kinds of federal administrative actions; indicate the sources of the law that governs how they are conducted and, very briefly, the nature of that law and the nature of proceedings; discuss the current relative importance of various kinds of administrative actions in the whole scheme of things; and discuss also current proposals for their reform, and, finally, suggest the possible direction of the further development of our system of administrative law.
The APA Classification of Administrative Actions
The best place to start when you are talking about the various kinds of federal administrative actions is with the Administrative Procedure Act.5
The importance of the APA's scheme of classification can readily be exaggerated. The scheme, moreover, is not symmetrical and so can be deceptive. And it is probably not exhaustive of all forms of administrative action. Finally, in
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important respects, it is counterintuitive. But, after those qualifications are stated, the APA remains the place to start.
Section 551 of Title 5 of the United States Code is the definitions section, old Section 1, of the APA. It contains a quite coherent set of definitions that describe what the statute deals with. The critical ones for our immediate purposes are the definitions of "rule," § 551(4), "rule making,"6 § 551(5), "order," § 551(6), and "adjudication," § 551(7).
The only one of those four definitions with real meat to it is the definition of "rule"; the other three are derivative of the definition of "rule."
"'[R]ule' means the whole or a part of an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy or describing the organization, procedure, or practice requirements of an agency and includes the approval or prescription for the future of rates, wages, corporate or financial structures or reorganizations thereof, prices, facilities, appliances, services or allowances therefor or of valuations, costs, or accounting, or practices bearing on any of the foregoing...."
"Rule making" goes with "rule." It means "agency process for formulating, amending, or repealing a rule."
The other two terms also go together: "order" and "adjudication." Order is a seeming catch-all — any final disposition of an agency in a matter other than rule making and including licensing. And adjudication is agency process for the formulation of an order.
Thus, "rule" comprehends what in common speech we describe as a rule or regulation — a generally applicable statement designed to affect future conduct by interpreting the law or telling how law will be enforced or prescribing law or policy. But, you will notice, it also comprehends such a statement that has particular applicability. Further, it includes specifically the prescription for the future of rates. Therefore, an agency's decision in a typical ratemaking case involving even a single carrier or utility (let alone in a general rate case) is a rule, and the proceeding that results
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in such a decision, which may be the most formal of evidentiary proceedings, is a rulemaking proceeding.
An order — a final agency disposition of any matter other than rulemaking, including licensing — includes the National Park ranger's decision whether to grant your application for a camping permit; adjudication is the procedure the ranger follows in reaching that decision just as much as it is the procedure the Federal Trade Commission followed for seven years in processing the massive monopoly case against the major oil companies that has now been abandoned.7
Only very imprecisely, then, does the APA draw the distinction that the Senate committee in charge of the legislation described, the distinction between the "so-called legislative functions of administrative agencies (where they issue general regulations) and their judicial functions (in which they determine rights or liabilities in particular cases)."8 The division is not between the formal and the informal, the evidentiary and the legislative or even the general and the particular. The affront to common understanding that resides in the notion that a rule may be of particular applicability has led the American Bar Association and the Administrative Conference of the United States to propose amending the definition of rule.9 But Congress has not been moved, perhaps agreeing with our foremost administrative law scholar, Kenneth Culp Davis, that there is no need to amend the definition because in the 35 years since the APA was enacted there is no evidence of anyone having been misled or of the definition causing any other problem.10
Do rulemaking and adjudication exhaust the category of administrative action? As I've already indicated, the answer to that is probably no. Professor Davis thinks that the catch-all nature of the definition of adjudication means that under the APA, taken literally, all administrative action is either adjudication or rulemaking.11 He says that nevertheless customary thinking runs so strong that a lot of agency action is not fairly considered by anyone as adjudication or rulemaking. He says that "agencies do not necessarily either adjudicate or make rules when they initiate, investigate, threaten, publicize, conceal, plan, recommend, and supervise."12 Some of the functions he mentions are probably better considered as executive than administrative; administrative law covers a wide enough field as it is without making it cover agencies' budgetary processes, to take an example of an executive function. But three or four items in Davis's list deserve brief consideration before we turn to what the APA and other sources of law have to say about how the two main kinds of administrative actions, adjudication and rulemaking, are to be taken.
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Agencies do indeed threaten and publicize. There is some literature on the use of publicity by agencies as a device for imposing sanctions on people.13 The Administrative Conference of the United States has made a recommendation to the agencies on the subject, in which it said by way of preamble:
"Agency practices regarding adverse publicity vary widely. Some agencies use adverse publicity as the primary method of enforcement; for some others it is merely action...
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