Legislation Class Notes 4/22/04


Administrative law and statutory interpretation


Courts traditionally have tried to protect their common law powers from encroachments from legislatures.  And then courts may be more suspicious of agency rules because they lack the same democratic lineage that legislatures have.  Agency rules are not issued directly by elected officials and don’t always involve the kinds of public participation that we see in the legislative process that tends to legitimate action by government.  Should agencies or courts have greater authority in interpreting statutes?  That’s the big question in the modern age of administrative laws.  Some statutes are enforced directly by the courts.  Some statutes establish administrative agencies to make rules and then enforce them.


The basic or traditional approach of Udall v. Tallman is that courts give a lot of deference to the agency that is charged with the enforcement of a statute that is being interpreted.  We give special deference when statutes are “untried and new” and there is a contemporaneous construction issue.  Why?  Is that more a matter of expertise in legislative intent or expertise in subject matter?  Let us focus on the intent issue, which seems particularly salient when we are within “hailing distance” of what Congress is thinking.  A key assumption in the BankAmerica case is that contemporaneous rules are more authoritative because they are issued closer to the time of enactment.  Is there any special problem with giving deference to the agency based on the agency’s perception of what statutory intent is?  Why should we assume that agencies are completely neutral?  The agencies may be partisan!  They may be subject to outside lobbying.  Maybe the administration didn’t even support the bill.  Sometimes the agency may have opposed the bill, and thus it’s in their interest to interpret it in a watered-down way.


About whose legislative intent is the agency a likely expert?  They are probably most aware of what the committee is thinking.  They probably didn’t spend much time dealing with the rest of the House and Senate.  Depending on how much you want to credit committee reports, you may be okay with this.  But if you are like Scalia, for example, and see the committee process as being prone to manipulation, you might be concerned about agency communication when it’s based on communication with committee staff.  This is what public choice theorists call the “iron triangle”: committee staffs, agencies, and interest groups who can create a particularly favorable statutory interpretation and then defend it over time.


If contemporaneousness is a proxy for legislative intent, is there an aspect of the agency’s regulatory approach that should enhance or improve our view that they really are competent?  What makes us comfortable with their competence?  They have a process!  They give notice and they ask for comments from the public.  It’s not as politically accountable as the legislative process, but it does have a sort of democratic pedigree to it.  You won’t get a rule adopted just by announcing it.  You issue a preliminary rule, you invite interested groups to comment, and all of this generates a public record that courts can review.


Insofar as they have stood the political test of time, there is an implication that Congress has acquiesced in the rule.  If there was something particularly troubling about a rule, they could have used their power to revisit it.  Also, the public begins to rely on a long-standing rule.  If the court abrogates the rule, they could upset the reasonable expectations of many people.


General Electric Co. v. Gilbert


Rehnquist is writing this opinion.  Why don’t we defer to the EEOC guidelines of 1972?  When Congress says: “We charge you as an agency to promulgate rules to further the purposes of this Act”, the agency must go ahead and do that.  The EEOC didn’t have that authority under Title VII when this case was decided.  The EEOC was supposed to do many things, but their authority to issue guidelines and interpretations was more limited because they weren’t given formal rulemaking power.  The standard is dependent on how consistent you’ve been.  We want to know if the agency is consistent in its pronouncements.  Why does the agency fail here, according to Rehnquist?  We have had a series of divergent interpretations about whether pregnancy is covered in this situation.  The EEOC changed its mind over a period of time.  Is Skidmore the “kiss of death” in terms of getting your guideline sustained?


Chevron, U.S.A., Inc. v. Natural Resources Defense Council


This is the major and still controlling Supreme Court statement of the role of agencies in statutory interpretation.  This one concerns the EPA’s interpretation of the Clean Air Act.  What is the two-step test that the Court sets forth for when a court should defer to an agency’s construction?  If Congress has spoken directly to the issue, we override the agency and there is no deference.  But if Congress has not spoken directly, and the statute is silent or ambiguous with respect to the particular issue, then the court must ask “whether the agency’s answer is based on a permissible construction of the statute.”  That sounds like a pretty low level of scrutiny.  Regulations are given controlling weight unless the construction is impermissible.  If the construction is “arbitrary, capricious, or manifestly contrary to the statute”, then the court can override the construction.


For this form of deference, is the Court relying on traditional justifications for trusting agencies?  No.  This reverses the traditional notion.  By default, the courts will defer to agencies.  In circumstances where the legislation is not clear on its face, agencies have more legitimacy than courts in being the primary interpreters.  That’s a big step, and a sea change in the way courts look at agency actions.  Agencies have been allowed to have a special perch because they are either experts on legislative intent or have special expertise, but now the courts find that agencies have an even more privileged positions than the courts do!


The court recognizes three reasons why a statute might be ambiguous: (1) Congress may intend to have the agency strike the balance.  (2) Congress may have ignored the issue entirely.  (3) Congress may have failed to strike a balance and thus agreed to leave it blank.  But it doesn’t matter for judicial purposes which of these things occurred.


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