How a typical formal adjudication hearing proceeds – a general framework:

1. How a typical formal adjudication hearing proceeds – a general framework: • Notice of agency hearing - Sec. 554(b): • Time & place of hearing, legal authority and jurisdiction, matters of fact/law asserted • As discussed yesterday, this will often look like a complaint because of this last requirement - in fact, such notices are often called “complaints” – see, e.g., Cinderella Finishing Schools. • Hearing: • Agency (e.g., head(s) of agency), a member of the body comprising the agency (e.g., commissioners), or ALJ shall preside at the hearing - (Sec. 556(a)) • Presiding individual shall provide opportunity for parties to present • Oral or documentary evidence, rebuttal evidence, cross-examination - Sec. 556(d) • Note the powers available to the presiding officer for ensuring the collection of evidence – Sec. 556(c)

2. How a typical formal adjudication hearing proceeds – a general framework, continued: The Decision and Appeals W/in the Agency • When the agency did not preside at hearing, the person presiding shall issue either an initial or tentative decision • Prior to either of these decisions, the parties can submit proposed findings or exceptions – Sec. 557(b)&(c) • If the decision was an initial decision, it becomes final if no appeal to the agency • If there is an appeal to the agency, it will be treated much as a judicial appeal – i.e., based on a defined record - Sec. 556(e) • BUT the reviewing agency has the same powers as the initial decision maker so it can accept or reject their findings as it wants - Sec. 557(b) • If the decision was tentative, it automatically goes to the agency for actual final decision • Again, the agency will make its decision based on the record in Sec. 556(e) although it can accept and reject findings as it wants

3. Combination of functions and formal adjudications • Recall Withrow v. Larkin: • Combination of functions – investigation, prosecution, adjudication – within an agency – does not alone offend constitutional procedural due process requirements • Nevertheless, concerns about bias or undue influence still exist when agency officials engage in all of these tasks in the course of a single hearing. • Statutes have stepped in to fill some of this void • APA – separates functions and insulates ALJs somewhat • Missouri – In state law administrative issues, Administrative Hearing Commission (independent agency that hears appeals from various agencies in certain areas)

4. APA and the separation of functions in formal proceedings – Sec. 554(d) • An “employee who presides at the reception of evidence” – shall NOT • Consult a person or party on a fact in issue, unless on notice/opportunity for all parties to participate. • This is in addition to Sec. 557(d)’s prohibition on ex parte contacts with outsiders • Be responsible to or supervised by any employee/agent who investigates or prosecutes for the agency • Conversely, no employee w/ investigation/prosecution functions in that case or a factually related case may participate in or advise in a decision, recommended decision or review of that decision • Can participate as a witness or counsel in public proceedings

5. Some exceptions to the APA’s separation of functions • Section 554(d) does not apply to: • Hearings re applications for initial licenses • Hearings re validity or application of public utilities’ or common carriers’ rates • To the agency or members of the body comprising the agency • Why these exceptions: • In the first two – there is a sense that the agency and regulated entity generally aren’t in an adversarial position despite formality of hearing • Note – Sec. 557(d) prohibitions on ex parte contacts do still apply • In the last – exemption for agency heads or “members” (essentially heads of multi-member agencies) is necessary. They often have prosecution/investigation duties. Without the exception, they would be unable to (1) sit in review of ALJ decisions or (2) ever supervise ALJs

6. APA hypotheticals - do the following scenarios violate Sec. 554? • Pursuant to §§554/556/557, the Assoc. Dir. of the Consumer Prod. Safety Cmms’n (CPSC) filed a complaint against a certain crayon manufacturer because the crayons allegedly contained dangerous chemicals. • Critical to this prosecution is whether the chemicals found in the crayons “pose an unreasonable danger to the health and safety of” children as required in the applicable statute. • If the ALJ takes evidence and testimony on the issue but still is unclear on some of the scientific issues, can he consult a CPSC scientist for help? • Can he consult a CSPC lawyer for aid in interpreting the statute? • What if the ALJ issues an initial decision in favor of the CPSC and the manufacturer appeals. After the appeal is heard and still pending CSPC Commissioner A talks to the Associate Director about the pending case.

7. Separation of functions and Missouri’s Administrative Hearing Commission • In Missouri, the Administrative Hearing Commission exists as an independent agency that can hear certain kinds of cases. • AHC hears appeals and original claims arising from a variety of agencies in contested licensing cases, tax cases, some personnel disciplinary issues and other miscellaneous issues – see http://oa.mo.gov/ahc/ & http://oa.mo.gov/ahc/pdf/JurisdictionChart.pdf • A contested case is a formal adversarial hearing similar to formal adjudication under the APA • See Mo. Rev. Stat. § 536.010(4): contested case = proceeding before an agency in which legal rights, duties or privileges of specific parties are required by law [statute, regs or constitutional due process] to be determined after [adversarial] hearing.” • Contested hearings before the AHC provide some separation of functions from the initial prosecution/investigation (and sometimes initial decision)

8. Final Exam Info • Exam – Monday, May 7, 1:30 pm • Office Hours (just for you): • Friday, May 4 – 9:00-3:00 • Sunday, May 6 – 9:30-noon • Monday, May 7 – 8:30-11:00 • I will be around the office other than these times if you want to drop in or make an appointment but this is when you can know I will be prioritizing Admin Law students.