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We've already learned a little bit about the nature of administrative agencies,
we've learned about how they go about making rules and regulations,
those two terms are really sort of interchangeable,
agency rules, and agency regulations.
In this lesson we're going to talk about how agencies
investigates violations of those rules or alleged violations of those rules,
and also how they adjudicate disputes and enforce the rules in administrative courts.
So, as a general rule,
agencies have the power to investigate violations of the rules of the agency's past.
This is kind of a weird setup if you think about it because in
no other governmental realm does
the same agency that makes the rule investigate the violations of the rule.
As a general rule, the legislative branch makes rules,
the executive branch enforces the rules through its police power,
but in an administrative agency,
it does all of that within one entity.
So, for example, the Securities and Exchange Commission,
that's an administrative agency,
it makes rules about trading stock and issuing securities.
Things like that. But the SEC also investigates
violations of its own rules pertaining to trading securities,
stocks, bonds, other sorts of securities.
Now, an agency does not need to have received
some allegation of a violation in order to investigate.
Many agencies are empowered to conduct surprise investigations such as OSHA,
the Occupational Safety and Health Administration.
It is an agency that is tasked with making sure that
workplaces are safe in this country and OSHA has
the power to just conduct spot checks for the places of business that it regulates.
So, actually a long time ago I used to work at
a hospital and it was not uncommon at all for
the OSHA representatives to just show up to make sure
that OSHA policies were being complied with at the hospital.
So, if an agency receives a tip of a potential violation,
it can certainly investigate but also they have the power to just conduct
investigations in their routine course of business in a lot of instances.
Finally, agencies have what we call subpoena power.
If you know anything about courts or the litigation process,
subpoena power might be familiar to you.
But this is the authority that a body has to force
somebody to come and testify or for somebody to turn over some documents.
So subpoena power is very powerful.
Congressional committees have subpoena power,
courts have subpoena power.
It just means we can force you to come and tell us stuff or we
can force you to give us documentation and if you don't,
you can be held in contempt and have to sit in jail for a while.
So subpoena power is very powerful.
Now let's talk about administrative courts.
Once an agency has investigated an allegation of
a violation or has found a violation during a spot check or something like that,
administrative agencies usually also adjudicate these things within their own bodies.
So instead of saying, hey, we found a violation,
we're going to send you to a regular court.
Many times they say, we found a violation,
now just come to the court that's right next door, the Administrative Court.
Administrative courts are not like regular courts.
They're presided over by a person called an Administrative Law Judge,
who acts sort of like a judge in traditional court but sort of differently.
Administrative Law Judges or ALJs as we call them,
are actually employees of the agency.
So, right off the bat,
there can be questions about bias.
If my employer is one party to
a dispute and a third party is another party
to the dispute and my job is to decide who wins,
my employer or this random Joe I've never met in my life.
Do you think I could be biased? It's possible.
So, this is one reason why administrative courts are actually subject
to judicial review because in the case of a biased ALJ,
which I'm not saying happens very often,
most Administrative Law Judges are very serious about their jobs and do a great job
of avoiding bias but still they're employees of one of
the parties who appear before them on a regular basis.
Administrative court decisions are subject to judicial review.
So, a regular court,
a federal court, or in the case of a state administrative agency,
a state court can take a look at the ALJ's decisions to ensure that bias wasn't a factor.
Now, administrative law courts are very narrow in scope.
They can only hear matters pertaining to
the issues within the scope of authority of that agency.
So I gave the example earlier of the Securities and Exchange Commission.
They regulate stock markets and the trading of securities.
So, administrative courts within the Securities and Exchange Commission could not hear
an environmental protection dispute or anything else that
falls outside the scope of that agency's power.
Now once a matter makes it into an administrative courts,
the process is sort of similar to regular court and sort of not.
Much like regular court,
negotiated settlements are really really common in an administrative court setting.
The vast majority of lawsuits in regular court and the vast majority of
disputes in administrative courts are settled before they
ever get to a trial or a formal hearing or anything like that.
So in an administrative setting,
the agency and the person who's accused of a violation,
will negotiate before the actual hearing and often times arrive at some settlement.
So, the violator agrees to pay a fine or do whatever,
and then the hearing isn't so much
a fact finding session but just an approval of their settlement.
If they don't settle,
they move to what's called an administrative hearing.
This is sort of similar to a trial in regular court.
The administrative hearing is much less formal though the formal rules of evidence,
the Rules of Civil Procedure,
those things don't apply in an administrative hearing,
and an ALJ is actually much more participatory in the process than a typical judge.
In regular court, the judge kind of sits back,
let's the parties present their cases,
decides questions of should this be admitted as evidence, things like that.
In an administrative hearing,
the ALJ is much more participatory,
can ask questions of the witnesses,
can seek out further information.
After the hearing is finished,
the ALJ will issue what's called the initial order.
The initial order is similar to the verdict in a regular lawsuit.
It's the ALJ's initial findings in the dispute.
It's called the initial order because it's subject to
change but it doesn't change very frequently.
The only way an initial order is going to change is if one of the parties appeals
that order to regular courts and the regular court decides that the ALJ was wrong.
But, this does not happen very often because
courts give a lot of deference to decisions of administrative agencies.
Even sometimes if the regular court disagrees with the findings of the agency,
the court will still give that agency deference.
It's very hard to win an appeal from
an administrative law decision in regular court but sometimes it happens.
I'm not saying it never happens, it's just difficult.
So, if your appeal fails or if nobody appeals,
then the initial order will become what's called a final order,
and the final order could say,
someone has to pay a fine or something like that.
The final order is the same as the verdict in the trial
and it has the force of law and the parties are required to abide by it.
Professor Michael R FrickeTeaching Assistant Professor
