The highest importance. On those subjects, such as the separation of examiners from the agencies they serve, there has been a wide divergence of views. committee has in such cases taken the course which it believes will suffice without going too far at this time. Moreover, amendatory or supplementary legislation can supply any deficiency which experience discloses. The committee believes that special note should be made of the following situations: The exemption of rule making and determining initial applications for licenses from provisions of sections 5 (c), 7 (c), and 8 (a) may require change if, in practice, it develops that they are too broad. The committee feels that, where cases present sharply contested issues of fact, agencies should not as a matter of good practice take advantage of the exemptions. Should the preservation in section 7 (a), of the "conduct of specified classes of proceedings in whole or part by or before boards or other officers specially provided for by or designated pursuant to statute," prove to be a loophole for avoidance of the examiner system in any real sense, corrective legislation would be necessary. That provision is not intended to permit agencies to avoid the use of examiners, but to preserve special statutory types of hearing officers who contribute something more than examiners could contribute and at the same time assure the parties a fair and impartial procedure. The The basic provision respecting evidence in section (c)—requiring that any agency action must be supported by plainly "relevant, reliable, and probative evidence"-will require full compliance by agencies and diligent enforcement by reviewing courts. Should that language prove insufficient to fix and maintain the standards of proof, supplemental legislation will become necessary. standards and principles of probity and reliability of evidence must be the same as those prevailing in courts of law or equity in nonadministrative cases. There are no real rules of probity and reliability even in courts of law, but there are certain standards and principles-usually applied tacitly and resting mainly upon common sense-which people engaged in the conduct of responsible affairs instinctively understand and act upon. They may vary with the circumstances and kind of case, but they exist and must be rationally applied. These principles to govern in administrative proceedings. The "substantial evidence" rule set forth in section 10 (e) is exceedingly important. As a matter of language, substantial evidence would seem to be an adequate expression of law. The difficulty comes about in the practice of agencies to rely upon (and of courts to tacitly approve) something less-to rely upon suspicion, surmise, implications, or plainly incredible evidence. It will be the duty of the courts to determine in the final analysis and in the exercise of their independent judgment, whether on the whole record the evidence in a given instance is sufficiently substantial to support a finding, conclusion, or other agency action as a matter of law. In the first instance, however, it will be the function of the agency to determine the sufficiency of the evidence upon which it acts— and the proper performance of its public duties will require it to undertake this inquiry in a careful and dispassionate manner. Should these objectives of the bill as worded fail, supplemental legislation will be required. "Substantial evidence" means evidence which on the whole record is clearly substantial, sufficient to support a finding or compulsion under section 7 (c), and material to the issues. The foregoing are by no means all the provisions which will require vigilant attention to assure their proper operation. Almost any provision of the bill, if wrongly interpreted or minimized, may present occasion for supplemental legislation. On the other hand, should it appear at any time that the requirements result in some undue impairment of a particular administrative function, appropriate amendments or exceptions may be in order. This is not a measure conferring administrative powers but is one laying down definitions and stating limitations. These definitions and limitations must be interpreted and applied by agencies affected by them in the first instance. But the enforcement of the bill, by the independent judicial interpretation and application of its terms, is a function which is clearly conferred upon the courts in the final analysis. It will thus be the duty of reviewing courts to prevent avoidance of the requirements of the bill by any manner or form of indirection, and to determine the meaning of the words and phrases used. In several provisions the expression "good cause" is used. The cause so specified must be interpreted by the context of the provision in which it is found and by the purpose of the entire section and bill. Cause found must be real and demonstrable. If the agency is proceeding upon a statutory hearing and record, the cause will appear there; otherwise it must be such that the agency may show the facts and considerations warranting the finding in any proceeding in which the finding is challenged. The same would be true in the case of findings other than of good cause, required in the bill. As has been said, these findings must in the first instance be made by the agency concerned; but, in the final analysis, their propriety in law and on the facts must be sustainable upon inquiry by a reviewing court. The committee recommends that the bill as reported be enacted. (Following are inserts which were also printed in the above pages in December 1945 American Bar Association Journal and which are referred to by Mr. Montague :) ATTORNEY GENERAL'S STATEMENT APPROVING PROPOSED ADMINISTRATIVE PROCEDURE Аст (On October 19, 1945, there was delivered to the chairmen of the Committees on the Judiciary in the Senate and House of Representatives of the Congress of the United States from Attorney General Tom C. Clark a letter which, apart from its recitals and formal paragraphs, reads as follows:) I appreciate the opportunity to comment on this proposed legislation. For more than a decade there has been pending in the Congress legislation in one form or another designed to deal horizontally with the subject of administrative procedure, so as to overcome the confusion which inevitably has resulted from leaving to basic agency statutes the prescription of the procedures to be followed or, in many instances, the delegation of authority to agencies to prescribe their own procedures. Previous attempts to enact general procedural legislation have been unsuccessful generally because they failed to recognize the significant and inherent differences between the tasks of courts and those of administrative agencies or because, in their zeal for simplicity and uniformity, they proposed too narrow and rigid a mold. Nevertheless, the goal toward which these efforts have been directed is, in my opinion, worth while. Despite difficulties of draftsmanship, I believe that overall procedural legislation is possible and desirable. The administrative process is now well developed. It has been subject in recent years to the most intensive and informed study-by various congressional committees, by the Attorney General's Committee on Administrative Procedure, by organizations such as the American Bar Association, and by many individual practitioners and legal scholars. We have in general-as we did not have until fairly recently-the materials and facts at hand. I think the time is ripe for some measure of control and prescription by legislation. I cannot agree that there is anything inherent in the subject of administrative procedure, however complex it may be, which defies workable codification. * * * * The bill appears to offer a hopeful prospect of achieving reasonable uniformity and fairness in administrative procedures without at the same time interfering unduly with the efficient and economical operation of the Government. Insofar as possible, the bill recognizes the needs of individual agencies by appropriate exemption of certain of their functions. After reviewing the committee print, therefore, I have concluded that this Department should recommend its enactment. 85257-46- 16 COMPARISON OF BILLS AS TO ADMINISTRATIVE LAW AND PROCEDURE For convenient study by association members, the following summary compares and contrasts the provisions of the pending bill (S. 7 as revised) emanating from the minority in the Attorney General's committee in 1941 (approved in principle and supported by the association) and the Walter-Logan bill (drafted and supported by the association in 1939). The comparison shows the reasons which lead the association's committee on administrative law to regard the present bill, now reported favorably in the Senate, to be an improvement upon the previous bills as well as a long and remedial step in the right direction. BILL NOW PENDING (1945) (S. 7 and H. R. 1203, 79th Cong. For SEC. 1. Title.-"Administrative Proce- SEC. 2. Definitions.-Defines (a) agency, SEC. 3. Public information.-Except se- SEC. 4. Rule making.-Except war, for- MINORITY BILL FROM THE ATTORNEY-GENERAL (S. 674, 77th Cong. For correct text see Same title [sec. 100]. Definitions not as complete [sec. 102]. Subdelegations of authority authorized [sec. 103]. Similar provisions respecting the issu- Similar general exceptions [sec. 2011; protection for reliance on published rules [sec. 204]; similar notice [sec. 208]; similar procedure [sec. 209]; has less definite WALTER-LOGAN BILL (1939) (H. R. 6324, 76th Cong. For final text, Agencies defined by form or independ- No provision except that no one to be Rules to be made on notice of proposed BILL NOW PENDING (1945) after interested persons are to be per- SEC. 5. Adjudication.-Where statutes SEC. 6. Ancillary matters.-(a) Parties SEC. 7. Hearings. In hearings which Provisions apply in all cases not spe- Similar provisions as to appearance [sec. Similar provision respecting presiding WALTER-LOGAN BILL (1939) except upon Presidential declaration of No provision as to notice or contents No specification of rights of appearance Employee-boards to hear adjudications |