What Exactly is the South Carolina Administrative Law Court?, 0519 SCBJ, SC Lawyer, May 2019, #30

• Author: Chelsea J. Clark
• Position: Vol. 30 Issue 6 Pg. 30

What Exactly is the South Carolina Administrative Law Court?

Vol. 30 Issue 6 Pg. 30

South Carolina BAR Journal

May, 2019

Chelsea J. Clark

To many people, administrative law appears to be a minefield of red tape and regulatory hurdles. A justice of the South Carolina Supreme Court has called administrative law a danger “to the once sacrosanct constitutional principle of separation of powers.”¹ However, it remains undisputed that administrative agencies—and the area of practice that surrounds them—are a vital and necessary part of our government.

Indeed, administrative law has its own line of constitutional precedent. These cases compare the need for efficient regulation with the citizen’s rights to procedural due process. For administrative purposes, this due process, which is generally defined as the right to notice, a meaningful opportunity to be heard and judicial review, is enshrined in its own provision of the South Carolina Constitution.²

There are numerous administrative forums in South Carolina, both federal and state. Of the state forums, the South Carolina Administrative Law Court (known as the “ALC”) hears the widest variety of cases, from both a procedural and substantive perspective. Cases heard by the ALC are appealed directly to the Court of Appeals and are never heard in Circuit Court. The Workers Compensation Commission is an example of another forum whose cases are heard on direct appeal. While the ALC hears cases from many different agencies, some administrative cases, including procurement matters, are still channeled from the administrative level to a Circuit Court appeal, and then the Court of Appeals.

The breadth and scope of the substantive jurisdiction of the ALC and the impact it has on the state might surprise attorneys not often practicing in the administrative arena. The ALC hears cases from the Department of Revenue; the Department of Health and Environmental Control; the Department of Health and Human Services; the Department of Corrections; the Department of Probation, Parole and Pardon Services; the Department of Motor Vehicles; and the Department of Employment and Workforce, among others.

These departments, and thus the ALC, have authority over state income tax matters, unemployment benefit cases, numerous different environmental permits such as those for landfills or docks, the licensing and permitting of alcohol sales, the incarceration and parole of inmates, the certification of new healthcare facilities, the suspension of drivers’ licenses, and more. The ALC also hears matters related to the administration of charter schools and daycares, as well as the certifications of law enforcement officers and cases relating to state retirement and benefits programs.

Because of the wide variation of administrative cases heard by the ALC, the sophistication of the parties and the types of procedure used also varies. There are two primary types of cases heard by the ALC. The first is “contested cases,” which are docketed with a “-CC” at the end of the case number. A contested case is a generic administrative term for the first level of hearing at an agency. The term is used in the South Carolina Administrative Procedures Act, which applies broadly to agency proceedings. At the ALC, “contested case” refers to matters heard in the trial-level jurisdiction of the court.³ Contested cases are conducted as bench trials in a courtroom before an administrative law judge, who has de novo review of the prior agency decision. Cases heard in this fashion include certificates of need for hospitals, alcohol license or permit violations, and tax matters.

The other primary type of case heard by the ALC is appeals, denoted by an “-AP.” Appeals cases are reviewed under the appellate standard of the Administrative Procedures Act. This standard only allows agency decisions to be modified or reversed in situations such as an error of law or a lack of evidence.⁴ The evidence standard used is “substantial evidence,” which is a bit different from the standards typically used in other courts like “preponderance of the evidence” or “clear and convincing evidence.” There is a line of cases stemming from one early case, which define substantial evidence as “not a mere scintilla of evidence nor the evidence viewed blindly from one side of the case, but . . . evidence which, considering the record as a whole, would allow reasonable minds to reach the conclusion that the administrative agency reached or must have reached in order to justify its action.” ⁵

Put plainly, administrative law judges cannot reverse an appealed agency decision based on the facts unless there truly is not any supporting evidence in the record of the case for the findings of the agency. In an appeals case, an administrative law judge lacks the authority to bring in new evidence or otherwise re-hear a case like they can with a contested case. The dichotomy between the de novo and appellate standards of review is the main distinction between the two main types of cases heard by the ALC and is a frequent source of confusion for those not familiar with the court.

One other major distinction is that appeals cases are typically decided on the briefs, without oral argument, in much the same fashion that the Court of Appeals sometimes decides cases with unpublished opinions. It is worth noting that both types of cases heard by the ALC ascend directly to the Court of Appeals, despite their different treatment at the ALC. The only other type of matter that the ALC currently has jurisdiction over is “regulation hearings,” which are sometimes required for the passage of regulations. In a regulation hearing matter, the administrative law judge is authorized to take comments from the public on proposed regulations and issue a report to the General Assembly.

Perhaps the greatest dissimilarity between the Court of Com- m on Pleas and the ALC is the way the cases are managed. The ALC consists of six elected judges, each of whom has a law clerk or judicial aide to manage his or her docket, and a staff attorney assigned to assist in researching and drafting orders. The ALC has a Clerk of Court’s office that handles the opening and closing of files, but once a case has been assigned to a specific judge, all flings are submitted directly to the chambers of that judge while the case is open.

The ALC also has its own set of rules. These rules should be read by anyone practicing before the court because of some unique provisions. Unlike Circuit Court, where an attorney may request a deadline extension from opposing counsel, all deadline extensions in an ALC matter must be granted by the judge. Cases may be dismissed, or motions adversely decided, where a party does not comply with the deadlines in the rules or request an extension from the assigned judge. This includes firm deadlines for motion responses.

The rules for the court are divided by case type. The three categories of proceedings mentioned above are represented, with the addition of unique rules for inmate appeals from the Department of Corrections and the Department of Probation, Parole and Pardon Services. There are also agency-specific shortened deadlines for Department of Employment and Workforce cases. These shorter deadlines are meant to allow unemployment appeals to be expeditiously reviewed. In the event a procedural issue arises that is not addressed in the rules of the ALC, a civil procedure rule may be consulted to guide the court in a contested case, while the appellate rules may be consulted for appeals. Most frequently, the court will refer to Rule 56, SCRCP, for motions for summary judgment, which are not specifically addressed in the ALC rules, but are frequently heard by administrative law judges in contested cases.

Inmate appeals illustrate one of the ways that the ALC intersects with other state courts and other areas of law. While the prosecution of defendants falls to the solicitor’s office, and the sentencing of defendants falls to a Circuit Court judge, the administration of the sentence imposed by the Circuit Court judge falls to the Department of Corrections and the Department of Probation, Parole and Pardon Services. After incarceration and the exhaustion of direct appeals, matters relating to the validity of an inmate’s sentence are heard in post-conviction relief cases by circuit court judges, while all matters related to the carrying out of the sentence by state agencies, including sentence calculation, parole eligibility, and disciplinary offense cases are heard by the ALC.

While the ALC has been a part of the legal system in South Carolina for more than 20 years, administrative law precedent is still developing, and it is not unusual for novel issues to be posed. Additionally, the intersecting jurisdictions of the Circuit Court and the ALC can create blurred lines in state precedent, further confusing practitioners attempting to navigate the often-complex area of administrative law. However, one area where the appellate courts have created a bright-line rule is constitutional challenges. The ALC may hear any as-applied constitutional challenge but may not hear facial constitutional challenges.⁶ The distinction is that as-applied cases concern facts that merit an exception in the application of a law, while a facial challenge asks a judge to overturn a law entirely. Because judges of the ALC fall under the umbrella of the executive—and not judicial— branch of government, they may only interpret and apply the law, not overturn it.

Adding to the confusion is the ALC’s subsidiary agency, the Office of Motor Vehicle Appeals, or “OMVH.” The OMVH exists to hear contested cases from the Department of Motor Vehicles, which no longer has its own hearing division. Decisions of the OMVH are then heard on appeal by the five judges of the ALC who are not involved in the administration of OMVH as an agency. Cases heard by the OMVH include implied consent hearings. Implied consent hearings exist to ensure proper procedure is followed prior to the suspension of a driver’s license for failure to cooperate with a breath-, or in some cases blood-, alcohol test.

As part of the public policy of the state, drivers who refuse to take an alcohol test are automatically subject to a six-month suspension of their license. This is a collateral consequence of a DUI case that takes many people by surprise. Most people adhere to the belief that giving a sample for an alcohol test after being pulled for DUI is against their best interests, because a result over the legal limit can result in criminal prosecution. While this rule is sound from a criminal lawyer’s perspective, it is not as sound from the administrative perspective. Many people can get themselves into further trouble because of the automatic six-month suspension of their license that results from the refusal. The only possible reprieve from the suspension is evidence that the arresting officer failed to follow the protocol, including advising the arrestee of his or her rights.

One procedural question presented by proceedings like an OMVH implied consent hearing is which court or quasi-judicial body takes precedence over the other when an attorney has a scheduling conflict. In a recent case, Justice John Few addressed this issue on behalf of the South Carolina Supreme Court. In analyzing Rule 601(a), SCACR, the Court determined that the OMVH is a separate administrative forum than the ALC and, therefore, must yield to scheduling conflicts with all other quasi-judicial bodies or courts.⁷ The ALC is ranked as number 9 on the list of tribunals, meaning that it takes precedence over Probate and Magistrate Court, while “administrative bodies,” such as the OMVH, are listed last at number 13.

Another potential surprise for attorneys who do not typically practice administrative law is the standard of review for ALC cases at the Court of Appeals. Most attorneys are familiar with the standard that allows the appellate court to sift through the record to find any evidence supporting a Circuit Court judge’s decision. However, in administrative cases, there must be explicit findings to support the legal conclusions made, and the Court of Appeals will not sift through the record looking for justification to affirm.⁸ This is particularly hazardous to attorneys in contested cases. Many assume that the record established at the agency level carries over to the ALC. However, that is only true in appeals. In a contested case, the record consists of the evidence admitted during the bench trial. Thus, an attorney must ensure that there is sufficient evidence for the judge to make detailed findings, even if establishing a new record seems duplicative.

For attorneys facing an ALC case for the first time, the differences between administrative and general civil law can be daunting, even for very experienced litigators. However, agency and ALC staff members are generally happy to answer procedural questions, especially if you have already checked the rules for an answer. Practice in administrative law can be fulfilling and often involves very complex issues. Some of the cases heard before the ALC are extremely important in the context of environmental, health and tax law or have a significant impact on a community. For instance, any large corporation doing business in South Carolina must bring a case at the ALC if they wish to protest the Department of Revenue’s approach to collecting taxes.^[9] Communities that dislike a local bar can come to the ALC to explain their reasoning and ask the judge to decide if an alcohol license or permit should be issued or renewed. One of the most important reasons that the establishment of the ALC has been a trailblazing and successful approach to managing administrative cases in South Carolina is that each judge can draw on an extensive institutional knowledge of administrative law and has the luxury of taking the time to think through his or her decision in a case. For this reason, the ALC acts as a safeguard to the potential pitfalls of an unrestrained fourth branch of government.

Chelsea J. Clark, a former staff attorney with the ALC, practices with Bruner, Powell, Wall & Mullins, LLC in Columbia.

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Notes:

[1] Joseph v. S.C.

Dep’t of Labor,

Licensing & Regulation, 417 S.C. 436, 455–56, 790 S.E.2d 763, 773 (2016) (J. Kittredge, concurring in result in a separate opinion).

[2] S.C. Const. art. I, § 22.

[3] S.C. Code Ann. § 1-23-600(A).

[4] S.C. Code Ann. §§ 1-23-380 & 1-23-600(D)– (E).

[5] Lark v. Bi-Lo,

Inc., 276 S.C. 130, 135, 276 S.E.2d 304, 306 (1981).

[6] Travelscape, LLC

v. S.C. Dep’t of

Revenue, 391 S.C. 89, 109, 705 S.E.2d 28, 38 (2011).

[7] Spalt v. S.C.

Dep’t of Motor

Vehicles, 423 S.C. 576, 816 S.E.2d 579 (2018).

[8] Porter v. S.C.

Pub. Serv. Comm., 333 S.C. 12, 21–22, 507 S.E.2d 328, 332 (1998).

[9] DIRECTV, Inc.

v. S.C. Dep’t of

Revenue, 421 S.C. 59, 804 S.E.2d 633 (Ct.App. 2017).

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