and interpretative rules. Likewise excepted from the thirty-day requirement of section 4 (c) are rules "granting or recognizing exemption or relieving restriction". For example, if a statute prohibits the doing of an act without prior agency approval and such approval falls within the definition of “rule” in section 2(c), the action of the agency in approving such act, i.e., removing the restriction or providing an exemption, may be made effective without regard to the thirty-day requirement. Senate Hearings (1941) p. 1296. Also, the relaxation of a restrictive rule by an amendment, or the repeal of such a rule, would seem to be within the scope of the exception. The reason for this exception would appear to be that the persons affected by such rules are benefited by them and therefore need no time to conform their conduct so as to avoid the legal conseqences of violation. The fact that an interested person may object to such issuance, amendment, or repeal of a rule does not change the character of the rule as being one "granting or recognizing exemption or relieving restriction", thereby exempting it from the thirty-day requirement.

The requirement of publication not less than thirty days prior to the effective date may be shortened by an agency "upon good cause found and published with the rule". This discretionary exception was provided primarily to take care of the cases in which the public interest requires the agency to act immediately or within a period less than thirty days. Senate Hearings (1941) pp. 70, 441, 588, 650, 812, 1506. Where the persons concerned request that a rule be made effective within a shorter period, this circumstance would ordinarily constitute good cause. Also, it is clear from the legislative history that for good cause an agency may put a substantive rule into effect immediately; in such event, the requirement of prior publication is altogether absent, and the rule will become effective upon issuance as to persons with actual notice, and as to others upon filing with the Division of the Federal Register in accordance with section 7 of the Federal Register Act. Senate Hearings (1941) pp. 594, 599, 1340, 1455. Nothing in the Act precludes the issuance of retroactive rules when otherwise legal and accompanied by the finding required by section 4 (c). H.R. Rep. p. 49, fn. 1 (Sen. Doc. p. 283).

Where an agency, pursuant to the last clause of section 4 (a), omits the procedures of section 4 (a) and (b) because "notice and public procedure thereon are impracticable, unnecessary or contrary to the public interest", subsection (c) does not thereby

become automatically inoperative. If the situation is such as to compel the agency, in addition, to dispense with the thirty-day provision, the rule should also contain the finding required by the last clause of section 4 (c).

Section 4 (c) is not intended to repeal provisions of other statutes which require a period of longer than thirty days between the issuance and effective date of certain rules. For example, the Cotton Standards Act authorizes the Secretary of Agriculture to set cotton classification standards which may not become effective in less than one year (7 U. S. C. 56). The thirty-day period prescribed by section 4 (c) of the Administrative Procedure Act does not supersede the one-year period thus required by the Cotton Standards Act.

SECTION 4(d)—PETITIONS

Section 4(d) provides that "Every agency shall accord any interested person the right to petition for the issuance, amendment, or repeal of a rule." Section 4(d) applies not only to substantive rules but also to interpretations and statements of general policy, and to organizational and procedural rules. It is applicable both to existing rules and to proposed or tentative rules.

The right to petition under section 4(d) must be accorded to any "interested person". It will be proper for an agency to limit this right to persons whose interests are or will be affected by the issuance, amendment or repeal of a rule.

Every agency with rule making powers subject to section 4 should establish, and publish under section 3 (a) (2), procedural rules governing the receipt, consideration and disposition of petitions filed pursuant to section 4 (d). These procedural rules may call, for example, for a statement of the rule making action which the petitioner seeks, together with any data available in support of his petition, a declaration of the petitioner's interest in the proposed action, and compliance with reasonable formal requirements.

If the agency is inclined to grant the petition, the nature of the proposed rule would determine whether public rule making proceedings under section 4 (a) and (b) are required. However, the mere filing of a petition does not require the agency to grant it or to hold a hearing or to engage in any other public rule making proceedings. For example, under section 701 (e) of the

Federal Food, Drug and Cosmetic Act (21 U.S.C. 371 (e)), the Federal Security Administrator must provide a hearing on a proposed rule only where an application, stating reasonable grounds, is made by an interested industry or a substantial portion of the industry. Section 4 (d) was not intended to modify that statute so as to require the Federal Security Administrator to hold a hearing on the petition of a single individual.

The agency need act on the petition only in accordance with its procedures as published in compliance with section 3(a) (2). The denial of a petition is governed by section 6(d). Sen. Rep. p. 15; H.R. Rep. p. 26 (Sen. Doc. pp. 201, 260). Accordingly, prompt notice of such denial should be given to the petitioner, together with a simple statement of the procedural or other grounds therefor.

Neither the denial of a petition under section 4(d), nor an agency's refusal to hold public rule making proceedings thereon, is subject to judicial review. Sen. Rep. p. 44 (Sen. Doc. p. 230).

This subsection (as in the case of the preceding portions of section 4) does not apply to rules relating to the functions and matters enumerated in the first sentence of section 4. The reports of the Senate and House Committees on the Judiciary state that "The introductory clause exempts from all of the requirements of section 4 any rule making so far as there are involved (1) military, naval, or foreign affairs functions or (2) matters relating to agency management or personnel or to public property, loans, grants, benefits, or contracts." (Underscoring supplied). Sen. Rep. p. 13; H.R. Rep. p. 23 (Sen. Doc. pp. 199, 257). The petition procedure of section 4 (d) is not applicable, for example, to the rules which an agency has issued or is empowered to issue with respect to loans or pensions.

IV

SECTION 5-ADJUDICATIONS

Section 5, together with sections 7 and 8, governs the procedure in formal administrative adjudication. In addition, section 5 lists the types of adjudication which are exempted from the detailed procedural requirements of sections 5, 7 and 8. It is to be noted that the excepted types of adjudication are exempt from all of the provisions of section 5, as well as of sections 7 and 8. Thus, if a particular matter is "subject to a subsequent trial of the law and the facts de novo in any court", subsection (d), authorizing agencies to issue declaratory judgments, is not applicable.

GENERAL SCOPE OF FORMAL PROCEDURAL REQUIREMENTS

"Adjudication" is defined as "agency process for the formulation of an order"; "order" is in turn defined as "the whole or any part of the final disposition (whether affirmative, negative, injunctive, or declaratory in form) of any agency in any matter other than rule making but including licensing" (section 2 (d)). Thus, investigatory proceedings, no matter how formal, which do not lead to the issuance of an order containing the element of final disposition as required by the definition, do not constitute adjudication. For example, accident investigations conducted by the Civil Aeronautics Authority pursuant to Title VII of the Civil Aeronautics Act do not result in orders, and therefore do not involve adjudication within the meaning of section 5.1

After examining the definition of "rule making" in section 2(c), it is apparent that the residual definition of "adjudication" in section 2 (d) might include many governmental functions, such as the administration of loan programs, which traditionally have never been regarded as adjudicative in nature and as a rule have never been exercised through other than business procedures. The exclusion of such functions from the formal procedural requirements of sections 5, 7 and 8 is accomplished by the introductory phrase of section 5 which limits its application (and, therefore, the application of sections 7 and 8) to cases of "adjudication required by statute to be determined on the record after op

1 In the Senate Comparative Print of June 1945, p. 2 (Sen. Doc. p. 13), it is stated: "It should be noted that the definition of agencies does not mean that all acts of such agencies are subject to the procedural requirements. *** If an agency is subject to the proposal under this section, nevertheless it is subject thereto only to the extent that acts, rules, or orders are defined and not further excluded in the following sections and subsections."

portunity for an agency hearing". It has been pointed out that "Limiting application of the sections to those cases in which statutes require a hearing is particularly significant, because thereby are excluded the great mass of administrative routine as well as pensions, claims, and a variety of similar matters in which Congress has usually intentionally or traditionally refrained from requiring an administrative hearing." Senate Comparative Print of June 1945, p. 7 (Sen. Doc. p. 22).

It will be noted that the formal procedural requirements of the Act are invoked only where agency action "on the record after opportunity for an agency hearing" is required by some other statute. The legislative history makes clear that the word "statute" was used deliberately so as to make sections 5, 7 and 8 applicable only where the Congress has otherwise specifically required a hearing to be held. Senate Hearings (1941) pp. 453, 577; Senate Comparative Print of June 1945, p. 7 (Sen. Doc. p. 22); House Hearings (1945) p. 33 (Sen. Doc. p. 79); Sen. Rep. p. 40 (Sen. Doc. p. 226); 92 Cong. Rec. 5651 (Sen. Doc. p. 359). Mere statutory authorization to hold hearings (e.g., "such hearings as may be deemed necessary") does not constitute such a requirement. In cases where a hearing is held, although not required by statute, but as a matter of due process or agency policy or practice, sections 5, 7 and 8 do not apply. Senate Hearings (1941) p. 1456.

Under section 5 of the Federal Trade Commission Act, for example, it is clear that orders to cease and desist from unfair methods of competition must be issued on the basis of the record made in the hearing which is required by that Act (15 U. S. C. 45). See also section 10 of the National Labor Relations Act (29 U. S. C. 160). Licensing proceedings constitute adjudication by definition and where they are required by statute to be "determined on the record after opportunity for an agency hearing", sections 5, 7 and 8 are applicable. Thus, under section 15 of the Securities Exchange Act (15 U. S. C. 780), the Securities and Exchange Commission may deny an application for broker-dealer registration or revoke such registration after notice and opportunity for hearing; while the Securities Exchange Act does not expressly require orders of denial or revocation of registration to be made "on the record", such a requirement is clearly implied in the provision for judicial review of these orders in the circuit courts of appeal. Upon such review, the Commission files "a