Your Top Ten List of California Administrative Law Reforms

• Citation: Vol. 38 No. 3
• Publication year: 2015
• Author: By Michael Asimow*

Your Top Ten List of California Administrative Law Reforms1

By Michael Asimow*

Professor Asimow engages participants with his keynote address on administrative law at the Administrative and Environmental Law Conference at U.C. Hastings on June 12, 2015.

INTRODUCTION

As laborers in the vineyard of California administrative law, we often forget how unique it is. California administrative law is completely unlike federal administrative law or the law of any other state. You'd have to think hard to find a single principle on which California law is the same as the law anyplace else. So it's a good idea sometimes to ponder those differences and decide whether they make sense or whether we should rethink them—even if they've been with us for generations.

Before I start on my destruction derby, however, I'd like to point out some unique features of California law that should be preserved. These include:

• Public interest standing. In California, anyone can sue the government about anything as long as the case meets the "public interest" or "taxpayer suit" standards.² Standing law is pretty simple and clear. Federal standing law, in contrast, is incredibly tangled and basically bans public interest and taxpayer standing.
• Public interest attorney fees. California allows them.³ The feds do not.⁴
• Independent ALJs from the Office of Administrative Hearings (OAH) preside over hearings in many cases, especially those relating to licensing.⁵ Independent ALJ panels exist in about 20 states but not at the federal level.
• State and local government is subject to equitable estoppel in California but the federal government is not.⁶
• Every regulation is checked for legality and clarity by the Office of Administrative Law (OAL).⁷ Nothing comparable exists elsewhere.
• California uses a sliding scale to determine how much deference is owed to agency legal interpretations.⁸ Under Chevron, the feds use an unsatisfactory result-oriented methodology that gives both too much and too little deference to agency legal interpretations.⁹

However, this article will focus on ten areas in which California is unique but, in my opinion, not in a good way. This article is going to be superficial. Space limitations prevent a detailed analysis; each of these topics merits an article of its own. Many (if not all) readers of this article will disagree with me about some (if not all) of my criticisms. I hope this begins a healthy conversation about some important administrative law issues and, in the future, possible legislative or judicial consideration of reforms. Unlike David Letterman's top-ten lists, these suggestions aren't in order from least to most important but instead are organized according to the administrative function involved—adjudication, rulemaking, judicial review, and open meetings.

ADJUDICATION10

1. Residuum rule

The residuum rule states that hearsay evidence that is not admissible in a civil action is admissible in administrative hearings to supplement or explain other evidence but is not sufficient in itself to support a finding.¹¹ In other words, California requires at least a "scintilla" or "residuum" of non-hearsay to support a finding in all adjudications, both state and local. Federal law, however, has rejected the residuum rule.¹²

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The residuum rule should be abolished. It makes no sense—how is a decision more reliable if the record contains a smidgeon of non-hearsay than if the decision is supported entirely by reliable hearsay evidence? All of us rely on hearsay all the time in our daily life¹³ and agencies are permitted to admit it into evidence. The residuum rule forces hearing officers in every state or local agency (many of them non-lawyers) to make difficult calls about whether one of the dozens of hearsay exceptions applies. The rule is a trap for self-represented persons who have no way to know that they should make an objection at the close of evidence that the government agency has failed to introduce the required scintilla. If they fail to make the objection, they waive the issue on judicial review. And for many agencies that rely heavily on written inter-agency or intra-agency reports the residuum rule creates serious practical difficulties.¹⁴

2. Burden of proof

In cases involving suspension or revocation of a professional license, an agency must prove its case by "clear and convincing proof to a reasonable certainty" rather than the normal preponderance standard.¹⁵ There is no logical reason for requiring this elevated standard of proof and the rule is not followed elsewhere. While licenses are obviously valuable to the people who hold them, the rights of the licensee are protected by numerous provisions in the APA, especially including the fact that independent ALJs preside at the hearings. The California regulatory statutes are intended to protect the public from bad licensees and the clear and convincing standard stacks the deck against the public.

3. Exceptions from the APA

A number of state agencies are exempted from the APA, particularly from the vital Administrative Adjudication Bill of Rights.¹⁶ These include the Public Utilities Commission, the State Board of Equalization, the University of California and the state college system.¹⁷ These APA exceptions have no logical rationale but reflect the political muscle of the exempted agencies that did not want to be subject to the APA.

RULEMAKING18

4. Complexity of rulemaking provisions

California's provisions for notice and comment rulemaking are of incredible length and mind-numbing complexity.¹⁹ The Legislature constantly adds on new impact statements and other bells and whistles but never removes anything. These provisions create massive and mostly useless paperwork requirements, increase the cost of government, delay the issuance of regulations, and furnish handles for reviewing courts to throw out the rules when the agency makes a mistake and OAL does not catch it. However, very few of these provisions create better regulations or enhance meaningful public participation. These provisions, which date from 1979, should be drastically pruned. The Legislature should return California to the relative simplicity of the pre-1979 provisions and those of federal law.²⁰

5. Guidance documents

The federal government issues massive amounts of guidance documents such as interpretive rules, bulletins, manuals, policy statements, or guidelines. They are extraordinarily valuable to lawyers and regulated parties who want to comply with the law. They assure uniform application of law by the agency's staff. These rules are adopted without going through the time-consuming and costly notice and comment process.²¹

California, in contrast, prohibits issuance of guidance documents without pre-adoption notice and comment.²² As a result, there are no guidance documents in California. This is an incredibly perverse requirement, harmful to regulated private parties and to agencies alike.²³ In 1999, the Legislature adopted a provision allowing issuance of guidance documents without full-fledged notice and comment but it was unaccountably vetoed by Governor Gray Davis.²⁴ The Legislature should try again, adopting a provision modeled on the balanced provisions for guidance documents in the 2010 Model State APA.²⁵

JUDICIAL REVIEW26

6. Mandamus

Why is it that we use the ancient British common law writ of mandamus in California to secure judicial review? This is incredibly outmoded. Under federal law, you get review through seeking an injunction or declaratory judgment.²⁷ Under the 2010 Model State APA, review is obtained under the regular rules of civil procedure.²⁸

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By contrast, in California, judicial...