The Last Frontier: Best Practices For True Informal Adjudication

This essay was authored by Professor Michael Asimow. It is the fourth part of a series, ACUS and the APA: Celebrating 75 Years of the Administrative Procedure Act, in which members of the ACUS community reflect on the agency’s connection to the foundational statute of federal administrative law. 

The views expressed in this essay are those of the author and do not necessarily represent the views of ACUS or the federal government.


At the time the Administrative Procedure Act (APA) was adopted, agency adjudication was the primary method by which federal administrative agencies enforced regulatory statutes. The APA’s adjudication provisions represented a “fierce compromise” between the federal regulatory establishment (which wanted maximum flexibility and minimal legal interference) and private sector actors, represented by the ABA’s Administrative Law Section (which wanted to judicialize the process). The result was a highly structured and formalized hearing process presided over by what we now call administrative law judges (ALJs). This process is what I and other authors describe as Type A adjudication. 

But the APA drafters had to struggle with the enormous diversity of administrative processes, so they limited the coverage of the APA’s adjudicative provisions to statutes that require on-the-record hearings. As applied by the courts, type A hearings are conducted only by a relatively few regulatory agencies and by Social Security and a few other benefit programs. In the 75 years between APA enactment and the present, it has become clear that Type A adjudication covers only a relatively small sliver of federal administrative adjudication. The APA doesn’t govern what I call Type B adjudication, meaning adjudication subject to legal obligations to conduct evidentiary hearings but that doesn’t pass through the gateway provision of the 5 U.S.C. § 554(a)

This is less of a problem than it seems, however, because Type B agencies are subject to a vast web of procedural regulations that largely mimic Type A protections (except, of course, that their hearings are conducted by Administrative Judges, or AJs, rather than by ALJs). Hearings in the Type B agencies are relatively formal and largely adversarial. They should not be described as “informal adjudication.” My ACUS study of Type B adjudication confirmed this pattern and suggested a set of best practices, most of which already exist by virtue of procedural regulations. In Recommendation 2016-4, ACUS recommended that agencies conducting Type B adjudication consider and adopt these best practices unless there are good reasons not to. Emily Bremer recommends that Congress require that all Type B agencies comply with a set of best practices similar to those in Rec. 2016-4.

But a huge reservoir of adjudication remains. This is Type C adjudication, meaning that the agency is not subject to any legal requirement to conduct an evidentiary hearing before making an adjudicatory decisions. This is “true” informal adjudication. It is largely inquisitorial rather than adversarial. The Supreme Court prohibits federal courts from prescribing procedures for Type C adjudication that the agencies have not chosen to provide themselves. 

Type C consists of a wildly disparate set of adjudicatory decisionmaking processes. Some involve enormous stakes, some involve trivial stakes (like the legendary forest ranger who assigns a campsite to you instead of me). Some involve massive caseloads; others occur infrequently. Some programs allow for meetings with decisionmakers; others are strictly on paper. Just to give the reader a sense of this trackless world, Type C covers adjudicatory decisions in the area of grants, benefits, loans, and subsidies; licensing and accrediting; national security and foreign policy; inspections, tests, and safety; many immigration disputes; tariff classification; and countless others. There have been proposals for statutes to guarantee procedural protection in Type C adjudication, but they gained little traction. 

In this brief blog post, I’d first like to observe that the APA did not leave Type C adjudication entirely unregulated. Two APA provisions apply to Type C adjudication, namely 5 U.S.C. §§ 555 and 558. In addition, due process protections applyto a relatively small percentage of informal adjudication. I propose that §§ 555 and 558 and informal due process be generalized to provide a set of best practices for Type C adjudication. The bare-bones APA rulemaking requirements of notice, opportunity for comment, and statement of reasons (unadorned by the case law) could also be generalized into Type C protections. These practices could be embodied in agency-specific procedural regulations, akin to those that ACUS Recommendation 2016-4 urged agencies to adopt for Type B.

Adoption of a set of best practices for the wildly disparate world of Type C recognizes that there is no one size that fits them all. Best practices must be flexible and presumptive. Agencies should be free to depart from them if there is a good reason to do so. Still, adopting a set of best practices grounded in the APA and due process would build on and honor the work of the drafters of the APA and provide at least a modest structure for Type C adjudication. 

This approach is superior to attempting to adopt statutory provisions regulating Type C. A statute would confront thorny definitional problems, especially drawing a precise line between agencies required to use Type B adversarial procedure and those using Type C inquisitorial procedure. There is also great difficulty in defining a class of trivial Class C encounters that should receive no protection, like those made by forest rangers. And finally, remembering that politics is the art of the possible, the chances of Congress reaching consensus on and putting resources into drafting a statute to provide Type C protections seem remote at best. So let’s turn to the more achievable goal of sketching rudimentary best practices for Type C, based on the APA and due process. 

Notice

Best practices should include notice that arrives in sufficient time and in sufficient detail so a person can decide whether to challenge the agency decision by whatever process is available. 

Notice requirements apply to a number of informal adjudication situations. 5 U.S.C. § 558(c) relating to licensing sanctions requires “notice by an agency in writing of the facts or conduct which may warrant the action.” Under § 555(e), in the case of a rejected application to an agency for some benefit or status, if an administrative process exists whereby the rejection can be challenged, the rejection communication should provide sufficient explanation to facilitate the challenge. Moreover, a notice requirement exists both in informal rulemaking under § 553(b) and due process requires adequate notice in informal adjudication situations. 

Thus agency procedural regulations should provide for appropriate notice that would vary depending on the stakes involved and the complexity of the matter. In emergencies, as suggested § 558(c), prior notice could be dispensed with. 

Opportunity to Present Evidence and Argument

An opportunity to tell one’s side of the story is foundational to every scheme of fair procedure, whether inquisitorial or adversarial. Agency regulations should allow private parties to present written or oral evidence and argument in support of their positions to the person responsible for making the decision. Perhaps the opportunity could be online or in an informal meeting with the decisionmaker, but it should exist in some form. 

The right to offer evidence and argument can be inferred from the second sentence of 5 U.S.C. § 555(b), which provides: “A party is entitled to appear . . . in an agency proceeding.” Procedural regulations should spell out the meaning of this opportunity to “appear. ” Of course, a similar right to “comment” exists in informal rulemaking under § 553(c) and it applies under due process as well. 

Right of Representation

Best practices include a right for private parties to be represented or assisted by another person, whether a lawyer, friend or family member, or lay advocate. The right to “appear” in 5 U.S.C. § 555(b) is “in person or by or with counsel or other duly qualified representative.” Lay representation is a practical necessity in most cases of Type C adjudication where the relatively low monetary stakes and the party’s likely inability to pay preclude hiring a lawyer.

Statement of Reasons

An agency conducting Type C adjudication should provide a brief oral or written statement of the facts and reasons on which its decision is based, explaining why a private party’s arguments were rejected and why the agency made discretionary choices. 

5 U.S.C. §555(e) requires that an agency that denies an application, petition, or other request shall furnish a notice that “shall be accompanied by a brief statement of the grounds for denial.” This requirement should be broadened beyond applications, petitions, or other requests, to cover all Type C adjudicatory decisions, including those imposing a sanction or other regulatory outcome. Similarly, the broadly accepted rulemaking process requires a “concise general statement of their basis and purpose” of the final rule that must respond to material comments filed by members of the public. Obviously, as in the case of notice, the detail and formality required of an agency’s reasons statement depends on the context, such as the stakes involved in the decision, complexity of issues, and caseload issues. 

Right of Administrative Review

common pattern of almost all adjudication schemes is the right to a second look by a different decisionmaker. In Type C adjudication, a disappointed party typically can request reconsideration in the decisionmaker’s superior or someone else in the administrative hierarchy. Therefore, drafters of procedural regulations for Type C adjudication should consider whether it is practicable to institutionalize the right of review by providing details and deadlines. Of course, there are many situations in which an opportunity for reconsideration is impracticable because of caseload, low stakes, or time constraints. The right of review is less firmly grounded in the APA or due process than the other recommendations but it is at least suggested by reference to “the agency” in § 553(c) and the custom that the head of an agency normally signs off on final rules. 

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The last frontier of procedural innovations is the Wild West of Type C adjudication. There is a vast amount of it and no uniformity of a sort that can be easily governed by a trans-substantive statute. Nevertheless, Type C adjudication lends itself to a best-practice approach, and the suggestions I have made in this post are mostly drawn or inferred from existing APA provisions or due process authorities. I hope these suggestions will inspire further study of the subject and perhaps ACUS consideration.


Michael Asimow is Professor of Law Emeritus at UCLA and Dean's Executive Processor of Law at Santa Clara University School of Law. He is the author of the ACUS sourcebook on Federal Administrative Adjudication Outside the Administrative Procedure Act and served as a consultant to ACUS on Recommendation 2016-4, Evidentiary Hearings Not Required By the Administrative Procedure Act.