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The committee said that it has been impressed by the frequent reluctance of high officers charged with serious policy-making functions, to relinquish control over the most picayune phases of personnel and business management.

The committee recommends that agencies should publish their policies and internal structure and organization and their procedures.

The committee recommends that, except in unusual cases, decisions should be explained by writing reasoned opinions.

The committee refers to the sentiment among lawyers that only members of the bar should be permitted to practice before administrative agencies. I should like to quote briefly from what it says on this subject:

“The committee doubts that a sweeping interdiction of nonlawyer practitioners would be wise, nor does it believe that corporations or other organizations should in all cases be forbidden to appear through and be represented by their officers.”

The majority of the committee would impose upon the Director of the Office of Federal Administrative Procedure, an office proposed to be created by both the majority and minority, the duty to investigate permission to practice before the several 'agencies in order to determine whether it can be centralized and controlled, with a view to eliminating needless delay and duplication in authorizing members of the bar to appear before agencies; regularizing the circumstances in which other than members of the bar may properly so appeal. This majority proposal recognized the right of nonlawyers to appear before administrative agencies.

The minority proposed two things: First, that the requirements for admission of attorneys or agents to practice, and the maintenance of formal registers of practitioners be omitted wherever practical. Secondly, that the OFAP may, subject to certain conditions, establish and maintain a central method for the registration for admission of attorneys and others to practice before the several agencies. The minority thus provided for the nonlawyer practitioners.

The committee proposed that, where admissions to practice are deemed necessary by any agency, attorneys admitted to practice in the highest courts of any State or Territory, or in any Federal court, should, upon written representation to that effect, be admitted to practice before such agency excepting, of course, the Patent Office.

The committee does not believe public hearings are necessary as a condition precedent to rule making, i. e., making of procedural rules. It does believe, however, that when possible, an opportunity should be given for persons to express their views, and that existing use of informal conferences and public hearings should be continued.

The committee says that regulations, as a general rule, should not be effective for at least 45 days after publication in the Federal Register. The committee takes the view that persons should have the right to petition for new rules or amendments of existing rules, and that the administrative agencies should report to Congress annually with respect to their rule-making activities. The committee opposed judicial review of administrative rules and regulations in general. The committee recommends the use of declaratory rulings as to the application of a rule where a person has an interest actually affected by the rule.

The committee rejected the view that the rule-making process is essentially the same as that of legislation, and that the legislative technique should be followed.

The committee reached the conclusion that there are four stages of rule making:

1. The investigation of the problems to be dealt with;
2. A formulation of tentative ideas of regulations ;
3. The testing of these ideas;
4. The formulation of the regulations.

The committee was very specific in its recommendation that those who are. affected by rules should have an opportunity to express their views with respect to those rules.

A considerable portion of the report is devoted to a discussion of the subject of informal procedures. The committee states that over 90 percent of matters coming before administrative agencies are informal procedures of one kind or another. The committee recommends that these procedures be improved in many instances.

The committee condemned the practice, in effect with some administrative agencies, whereby a person has to admit past guilt before he is allowed to consent to not violate a law in the future.

The committee recommends that in many instances where the statutes now require hearings, it would be enough to require the agency to give notice of the

proceeding, and if no protest is filed to then dispose of it without formal hearing.

Now, with respect to formal proceedings: The committee expresses the view that formal cases have an importance out of proportion to their numbers. What the committee says reminds me very much of what was said about Caesar's wife. The report states that not only should the decisions of the administrative agencies be impartial, but that the public should be convinced that they are impartial. Expertness and expedition are held by the committee to be essential.

The committee discusses and criticizes the length of hearings and the lengthy records in some cases. It is strong in its recommendation for prehearing conferences and stipulations of facts. The committee points out, however, with respect to prehearing conferences, that adequate authority must be given the representative of the agency who presides at such conferences.

The committee also recommends that all hearings be public, except, of course, where private and confidential matters are involved, such as in some of the proceedings before the Veterans' Administration.

The committee recommends the use by all administrative agencies of the socalled shortened procedure which has been so successfully used by the Interstate Commerce Commission.

The committee points out that the relaxation of common law rules of evidence in jury trials is a necessity in administrative hearings. The committee condemns the practice of some hearing officers in admitting evidence “for what it is worth," and says that such practices show indecision on the part of the presiding officer and result in unduly swelling of records.

The committee recommends a more extensive utilization of what we have come to call "official notice," but, at the same time, it says that this must be accompanied by what it refers to as "safeguarding mechanics.” The committee says the parties should be apprised of what the agency proposes to take "official notice," and sets up procedure to carry that into effect.

The committee recognizes that the heads of agencies cannot personally hear testimony and make the initial decisions. It recognizes that examiners, or hearing officers, are a necessity. As a matter of fact, they are referred to as "the heart of formal administrative adjudication."

The committee states that good men are attracted to these positions where their importance is recognized and adequate salaries paid; where authority and independence of judgment are accorded ; and where weight is given to their decisions. Where this is true, the committee finds that proceedings are well conducted and that the public has confidence in them.

The committee finds, however, that this situation does not exist throughout all of the administrative agencies, and proposes to correct that evil by setting up what are known as hearing commissioners instead of examiners. The committee suggests that these hearing commissioners should be men of ability, statute, and prestige. The committee says these men should be appointed for definite terms. The majority says 7 years—the minority says 12 years. The committee also says they should be paid substantial salaries.

According to the recommendations of the committee, these hearing commissioners would constitute a separate unit in each agency organization. They would have the same relationship to the agency as judges of lower courts have to appellate judges who review their decisions. Their functions would be limited to presiding at hearings or prehearing negotiations and to making initial decisions. They would be nominated by the agency, be approved and appointed by the OFAP. They would be removable only after hearing by a trial board independent of the agency to which the hearing commissioner is assigned.

Findings and decision of a hearing commissioner would become the final decision of the agency unless an appeal is taken by a party or review is ordered by the agency on its own motion. In reviewing the work of the hearing commissioners, agency heads would be limited to the specific grounds set out by the party seeking the review, or to the terms of the order of the agency directing the review. Conclusions and interpretations of law would be open to full review. Findings of fact, the committee says, should not be disturbed unless contrary to the weight of the evidence.

The committee suggests that oral arguments should be made before the boards or commissions, sitting as divisions when necessary. In the case of single-headed departments or agencies, the committee suggests that all pretense of personal consideration or decision should be abandoned, and boards of review or deciding officers created, with appeals to the agency head, in his discretion, and then The committee is in full agreement with the position that the same person should not be prosecutor and judge.

The committee recommends the creation of the Office of Federal Administrative Procedure, consisting of a justice of the United States Court of Appeals for the District of Columbia, to be designated by the chief justice of that court, the Director of the Administrative Office of the United States Courts, and the Director of Administrative Procedure, who would be appointed by the President, by and with the advice and consent of the Senate. Each agency would designate one of its responsible officers to serve as an adviser to the Director.

Functions of the OFAP would be:

1. To examine critically the procedures and practices of agencies which may bear strengthening or standardizing.

2. To receive suggestions and criticisms from all sources.

3. To collect and collate information concerning administrative practice and procedure.

4. To appoint hearing commissioners.

The committee suggests seven subjects which the OFAP might very well study, namely:

1. Admission to and control of practice. 2. The issuance of subpenas. 3. The use of depositions. 4. Forms of briefs and pleadings. 5. Answers. 6. The availability of records, including the costs of transcripts of proceedings.

7. Reports required to be made of citizens-going into their necessity and their duplication.

With respect to judicial review, the majority of the committee found existing provisions for judicial review to be wise and recommended that they should be maintained.

The majority believed that judicial review, generally speaking, should be limited to whether the agency acted within the scope of its authority, whether the procedure was fair, and whether the decision was based on substantial evidence. The majority proposed, however, that if a wrong method of review is sought, or if action is brought in the wrong court, then the court (if it has jurisdiction) should grant review as if a proper method had been chosen or (if it does not have jurisdiction) transfer the case to the proper court.

With respect to judicial review, the minority of the committee had a different view. The minority said that the haphazard, uncertain, and variable results of the present system (or lack of it) constitutes a “major deficiency,” and that the present scope of judicial review is subject to question by reasons of the interpretation of what constitutes substantial evidence.

The minority expressed the opinion that courts should set aside decisions clearly contrary to the manifest weight of the evidence.

In the view of the minority, present statutory formulas of judicial review fail to take account of differences between various types of fact determinations. The view is expressed that present standards of judicial review are unsatisfactory because they are determined by the usual case-to-case procedure of the courts. In this connection, the minority uses the statement: "Piecework process produces patchwork results.”

The minority agrees that the recommendations of the majority, if carried out, would go very far to effecting major improvements. The minority, however, proposed a "code of fair standards of administrative procedure,” to provide a “procedural pattern" to serve as a guide to administrators.

The minority believes that the majority does not go far enough with respect to the operation of prosecuting and judicial functions, the scope and practice of judicial review, and the need for a legislative statement of standards of administrative procedure. The minority discusses the “formlessness” of present procedure, and the need for legislative guidance.

The majority believed it to be the better part of wisdom to be content at this time with the several major steps the committee proposes, with future action depending upon experience with the operation of their proposals, and further studies by Congress, the agencies, and the suggested OFAP.

I appreciate, of course, that the foregoing is but a sketchy summary of the report, but, in the light of discussions that are to follow, I think it is perhaps all that needs to be placed in the record on this subject at this particular point. STATEMENT OF CARL MCFARLAND, WASHINGTON, D. C. Mr. McFARLAND. Mr. Chairman and members of the committee, my name is Carl McFarland. I am a member of the D. C. bar, and I am here as chairman of the American Bar Association's special committee on administrative law.

I shall attempt to assist the committee by discussing the structure and the provisions of the various bills that are before the committee. After all, most of these bills fall into a fairly standard pattern.

The CHAIRMAN. You are going to discuss the general subject?
Mr. McFARLAND. Yes.
The CHAIRMAN. Rather than the individual bills
Mr. McFARLAND. I am not particularly interested in “A, B, C” bills.
The CHAIRMAN. That is right.

Mr. MoFARLAND. All of these bills are drawn, and any intelligent measure must be drawn, on a functional basis. They do not relate to agencies by name. They relate to some of the specific kinds of things that administrative agencies do, just as legislation which you gentlemen have placed on the books relating to private individuals ordinarily does not relate to individuals by name but relates to what they do.

Furthermore, in this particular subject, no one has attempted to draw a set of rules of practice for any administrative agency. The whole idea has been to draw the skeleton, upon which administrative agencies may adopt their own rules of procedure.

All of these measures fall into a simple outline of three main points. The three subjects which they contain are: No. 1, public information; No. 2, administrative operation; and No. 3, judicial review. Every measure contains a series of formal provisions, such as title, definitions, effective date, and that sort of thing. Also, every measure contains some further provisions respecting some of the various incidents of administrative operation, the matter of appointment and status of examiners, the nature of the hearing, and the method of rendering decisions.

Administrative operation is the second of the three subjects, and necessarily divides itself into two parts, one relating to the making of general regulations, the second part relating to the determination

particular cases. Administrative agencies, despite all that has been said and all that has been tried, do nothing different than courts and legislatures do. They have invented new words, but nevertheless they legislate. They have invented new words, but nevertheless they adjudicate. They issue injunctions just as they issue statutes, and for those two different types of activities it is necessary that sharp distinctions be drawn.

It falls to me to discuss some of the details, and in discussing the operation of any measureMr. WALTER (interposing). May I interrupt for just a question 3 Mr. MCFARLAND. Yes.

Mr. WALTER. As a member of the Attorney General's committee, you participated in the preparation of a volume of research. I wonder where those volumes are. I think our committee ought to have a complete set.

Mr. McFARLAND. You mean the monographs?

Mr. McFARLAND. I have a complete set and will be glad to let the committee have them. I know of no higher purpose that could be served by them. There are several volumes of hearings also, and there are reports and Senate hearings, perhaps, that would be of interest.

Mr. WALTER. I think that we ought to have the monographs that were prepared by the Attorney General's committee.

Mr. McFARLAND. There are about 27 of them, I believe.
Mr. WALTER. Where could we get them?

Mr. McFARLAND. They are public documents, Mr. Aitchison points out, and have been printed, although a good many of them are out of print. I will be glad to see that the committee has a full set.

Mr. WALTER. Thank you.

Mr. McFARLAND. As † go, I think it would be helpful to compare, in a word or two, the previous proposals—chiefly the proposals that were made by the so-called Attorney General's committee.

All of these bills fall pretty much in the same pattern: The definition of an agency is probably the only one that would cause some difficulty to anyone that looks at it cold. The three initial definitions are the definition of “agency,” the definition of "rule making,” and the definition of "adjudication.” When you define an agency you still are not indicating very much about what any bill can do. The definition of an agency is merely an exclusionary device in all of these bills; it is a preliminary matter.

The first real subject of bills is the subject of public information. Most of the bills provide, and have in the last 5 or 6 years provided, that the agency should make certain kinds of rules. The Attorney General's Committee on Administrative Procedure was in favor and stated that one of the most serious aspects of the whole system was a lack of common, ordinary, simple information.

It is a curious thing about information here in Washington. Many people seem to have little interest in information. But west of the Appalachian Mountains and further west you will find that people are thinking about the problem of how to find out about administrative operations. Americans generally do not like to ask somebody; they want some official place where they can find out about the organization of the board or the committee or the commission. It is of little comfort to the ordinary person to be told that while there is no official statement, they can ask and will be told what they wish to know. The difference lies in a guarded oral statement and authoritative written information.

There seems to be no dissent from the provision respecting information. There was at one time considerable comment about the possibility that legislation, if attempted, would force the agencies to make substantive rules. In other words, the argument was that you cannot require an agency to make all necessary rules to cover all conceivable situations at one time. That is not proposed.

Mr. WALTER. Was not that a spurious argument, in view of the efforts of the people who are opposed to the philosophy of this type of legislation ? Mr. McFARLAND. I personally thought it was.

Mr. GWYNNE. People have asked me from time to time where to get information as to the rules and regulations respecting the Wages and Hours Administration, which from time to time does make rules and

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