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(3) one or more examiners appointed as provided in this Act; but nothing in this Act shall be deemed to supersede 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. The functions of all presiding officers and of officers participating in decisions in conformity with section 8 shall be conducted In an impartial manner. Any such officer may at any time withdraw if he deems himself disqualified; and, upon the filing, in good faith of a timely and sufficient affidavit of personal bias or disqualification of any such officer, the agency shall determine the matter as a part of the record and decision in the case.
(b) HEARING POWERS.-Officers presiding at hearings shall have authority, subject to the published rules of the agency and within its powers, to (1) administer oaths and affirmations, (2) issue subpenas authorized by law, (3) rule upon offers of proof and receive relevant evidence, (4) take or cause depositions to be taken whenever the ends of justice would be served thereby, (5) regulate the course of the hearing, (6) hold conferences for the settlement or simplification of the issues by consent of the parties, (7) dispose of procedural requests or similar matters, (8) make decisions or recommend decisions in conformity with section 8, and (9) take any other action authorized by agency rule consistent with this Act.
(c) EVIDENCE.-Except as statutes otherwise provide, the proponent of a rule or order shall have the burden of proof. Any oral or documentary evidence may be received, but every agency shall as a matter of policy provide for the exclusion of irrelevant, immaterial, or unduly repetitious evidence and no sanction shall be imposed or rule or order be issued except upon consideration of the whole record or such portions thereof as may be cited by any party and as supported by and in accordance with the reliable, probative, and substantial evidence. Every party shall have the right to present his case or defense by oral or documentary evidence, to submit rebuttal evidence, and to conduct such cross-examination as may be required for a full and true disclosure of the facts. In rule making or determining claims for money or benefits or applications for initial licenses any agency may, where the interest of any party will not be prejudiced thereby, adopt procedures for the submission of all or part of the evidence in written form.
(d) RECORD. The transcript of testimony and exhibits, together with all papers and requests filed in the proceeding, shall constitute the exclusive record for decision in accordance with section 8 and, upon payment of lawfully prescribed costs, shall be made available to the parties. Where any agency decision rests on official notice of a material fact not appearing in the evidence in the record, any party shall on timely request be afforded an opportunity to show the contrary.
SEC. 8. In cases in which a hearing is required to be conducted in conformity with section 7
(a) ACTION BY SUBORDINATES.-In cases in which the agency has not presided at the reception of the evidence, the officer who presided (or, in cases not subject to subsection (c) of section 5, any other officer or officers qualified to preside at hearings pursuant to section 7) shall initially decide the case or the agency shall require (in specific cases or by general rule) the entire record to be certified to it for initial decision. Whenever such officers make the initial decision and in the absence of either an appeal to the agency or review upon motion of the agency within time provided by rule, such decision shall without further proceedings then become the decision of the agency. On appeal from or review of the initial decisions of such officers the agency shall, except as it may limit the issues upon notice or by rule, have all the powers which it would have in making the initial decision. Whenever the agency makes the initial decision without having presided at the reception of the evidence, such officers shall first recommend a decision except that in rule making or determining applications for initial licenses (1) in lien thereof the agency may issue a tentative decision or any of its responsible officers may recommend a decision or (2) any such procedure may be omitted in any case in which the agency finds upon the record that due and timely execution of its functions imperatively and unavoidably so requires.
(b) SUBMITTALS AND DECISIONS.-Prior to each recommended, initial, or tentative decision, or decision upon agency review of the decision of subordinate officers the parties shall be afforded a reasonable opportunity to submit for the consideration of the officers participating in such decisions (1) proposed findings and
conclusions, or (2) exceptions to the decisions or recommended decisions of subordinate officers or to tentative agency decisions, and (3) supporting reasons for such exceptions or proposed findings or conclusions. The record shall show the ruling upon each such finding, conclusion, or exception presented. All decisions (including initial, recommended, or tentative decisions) shall become a part of the record and include a statement of (1) findings and conclusions, as well as the reasons or basis therefor, upon all the material issues of fact, law, or discretion presented on the record; and (2) the appropriate rule, order, sanction, relief, or denial thereof.
SANCTIONS AND POWERS
SEC. 9. In the exercise of any power or authority
(a) IN GENERAL.-No sanction shall be imposed or substantive rule or order be issued except within jurisdiction delegated to the agency and as authorized by law.
(b) LICENSES.-In any case in which application is made for a license required by law the agency, with due regard to the rights or privileges of all the interested parties or adversely affected persons and with reasonable dispatch, shall set and complete any proceedings required to be conducted pursuant to sections 7 and 8 of this Act or other proceedings required by law and shall make its decision. Except in cases of willfullness or those in which public health, interest, or safety requires otherwise, no withdrawal, suspension, revocation, or annulment of any license shall be lawful unless, prior to the institution of agency proceedings therefor, facts or conduct which may warrant such action shall have been called to the attention of the licensee by the agency in writing and the licensee shall have been accorded opportunity to demonstrate or achieve compliance with all lawful requirements. In any case in which the licensee has, in accordance with agency rules, made timely and sufficient application for a renewal or a new license, no license with reference to any activity of a continuing nature shall expire until such application shall have been finally determined by the agency.
SEC. 10. Except so far as (1) statutes preclude judicial review, or (2) agency action is by law committed to agency discretion
(a) RIGHT OF REVIEW.-Any person suffering legal wrong because of any agency action, or adversely affected or aggrieved by such action within the meaning of any relevant statute, shall be entitled to judicial review thereof.
(b) FORM AND VENUE OF ACTION.-The form of proceeding for judicial review shall be any special statutory review proceeding relevant to the subject matter in any court specified by statute or, in the absence or inadequacy thereof, any applicable form of legal action (including actions for declaratory judgments or writs of prohibitory or mandatory injunction or habeas corpus) in any court of competent jurisdiction. Agency action shall be subject to judicial review in civil or criminal proceedings for judicial enforcement except to the extent that prior, adequate, and exclusive opportunity for such review is provided by law.
(c) REVIEWABLE ACTS.-Every agency action made reviewable by statute and every final agency action for which there is no other adequate remedy in any court shall be subject to judicial review. Any preliminary, procedural, or intermediate agency action or ruling not directly reviewable shall be subject to review upon the review of the final agency action. Except as otherwise expressly required by statute, agency action otherwise final shall be final for the purposes of this subsection whether or not there has been presented or determined any application for a declaratory order, for any form of reconsideration, or (unless the agency otherwise requires by rule and provides that the action meanwhile shall be inoperative) for an appeal to superior agency authority.
(d) INTERIM RELIEF.-Pending judicial review any agency is authorized, where it finds that justice so requires, to postpone the effective date of any action taken by it. Upon such conditions as may be required and to the extent necessary to prevent irreparable injury, every reviewing court (including every court to which a case may be taken on appeal from or upon application for certiorari or other writ to a reviewing court) is authorized to issue all necessary and appropriate process to postpone the effective date of any agency action or to preserve status or rights pending conclusion of the review proceedings.
(e) SCOPE OF REVIEW.-So far as necessary to decision and where presented the reviewing court shall decide all relevant questions of law, interpret constitutional
and statutory provisions, and determine the meaning or applicability of the terms of any agency action. It shall (A) compel agency action unlawfully withheld or unreasonably delayed; and (B) hold unlawful and set aside agency action, findings, and conclusions found to be (1) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; (2) contrary to constitutional right, power, privilege, or immunity; (3) in excess of statutory jurisdiction, authority, or limitations, or short of statutory right; (4) without observance of procedure required by law; (5) unsupported by substantial evidence in any case subject to the requirements of sections 7 and 8 or otherwise reviewed on the record of an agency hearing provided by statute; or (6) unwarranted by the facts to the extent that the facts are subject to trial de novo by the reviewing court. In making the foregoing determinations the court shall review the whole record or such portions thereof as may be cited by any party, and due account shall be taken of the rule of prejudicial error.
SEC. 11. Subject to the civil-service and other laws to the extent not inconsistent with this Act, there shall be appointed by and for each agency as many qualified and competent examiners as may be necessary for proceedings pursuant to sections 7 and 8, who shall be assigned to cases in rotation so far as practicable and shall perform no duties inconsistent with their duties and responsibilities as examiners. Examiners shall be removable by the agency in which they are employed only for good cause established and determined by the Civil Service Commission (hereinafter called the Commission) after opportunity for hearing and upon the record thereof. Examiners shall receive compensation prescribed by the Commission independently of agency recommendations or ratings and in accordance with the Classification Acts of 1923, as amended, except that the provisions of paragraph (2) and (3) of subsection (b) of section 7 of said Act, as amended, and the provisions of section 9 of said Act, as amended, shall not be applicable. Agencies occasionally or temporarily insufficiently staffed may utilize examiners selected by the Commission from and with the consent of other agencies. For the purposes of this section, the Commission is authorized to make investigations, require reports by agencies, issue reports, including an annual report to the Congress, promulgate rules, appoint such advisory committees as may be deemed necessary, recommend legislation, subpena witnesses or records, and pay witness fees as established for the United States courts.
CONSTRUCTION AND EFFECT
SEC. 12. Nothing in this Act shall be held to diminish the constitutional rights of any person or to limit or repeal additional requirements imposed by statute or otherwise recognized by law. Except as otherwise required by law, all requirements or privileges relating to evidence or procedure shall apply equally to agencies and persons. If any provision of this Act or the application thereof is held invalid, the remainder of this Act or other applications of such provision shall not be affected. Every agency is granted all authority necessary to comply with the requirements of this Act through the issuance of rules or otherwise. No subsequent legislation shall be held to supersede or modify the provisions of this Act except to the extent that such legislation shall do so expressly. This Act shall take effect three months after its approval except that sections 7 and 8 shall take effect six months after such approval, the requirement of the selection of examiners pursuant to section 11 shall not become effective until one year after such approval, and no procedural requirement shall be mandatory as to any agency proceeding initiated prior to the effective date of such requirement.
Approved June 11, 1946.
Mr. GRAHAM. We have a number of witnesses here this morning who wish to be heard on the bill, so I will first call on Mr. Spingarn, Assistant General Counsel, Treasury Department, who is accompanied by Capt. Alfred C. Richmond, Planning and Control Officer, Coast Guard, and Capt. Kenneth S. Harrison, Chief Counsel, Coast Guard.
STATEMENT OF STEPHEN J. SPINGARN, ASSISTANT GENERAL COUNSEL, TREASURY DEPARTMENT, ACCOMPANIED BY CAPT. ALFRED C. RICHMOND, PLANNING AND CONTROL OFFICER, COAST GUARD, AND CAPT. KENNETH S. HARRISON, CHIEF COUNSEL, COAST GUARD
Mr. SPINGARN. Mr. Chairman, and gentlemen:
My name is Stephen J. Spingarn, Assistant General Counsel, Treasury Department. At my right is Capt. Alfred C. Richmond, Chief Planning and Control Officer of the Coast Guard, and to my left is Capt. Kenneth S. Harrison, Chief Counsel, Coast Guard.
I have a prepared statement, but with your permission, I will briefly outline our position and attempt to answer such questions as the committee may desire to ask, and have the formal statement appear at the conclusion of my testimony.
Mr. GRAHAM. You may proceed as you wish, Mr. Spingarn.
Mr. SPINGARN. The issue that we have here is a very simple one. It is a case where the Administrative Procedure Act, which was enacted last June, and economy have locked horns, so to speak.
The question is whether certain Merchant Marine hearings in the Coast Guard should continue to be conducted by commissioned officers of the Coast Guard as they have in the past or whether they should be conducted by civilian Civil Service examiners, as would be required by the Administrative Procedure Act, which would cost upwards of $280,000 a year, we estimate.
This bill presents the question by providing an exemption from Section 11 of the Administrative Procedure Act, which provides that hearings of this character shall be conducted by civilian Civil Service examiners, to permit commissioned officers of the Coast Guard to carry on these hearings.
The Coast Guard operates under the Treasury Department in peacetime and under the Navy in wartime.
This matter is urgent because the section providing for civilian Civil Service examiners goes into effect on June 11, 1947, and if we do not get the exemption which this bill would grant we would have to go to the Appropriations Committee and get money with which to hire these people and have to recruit them, and that is something that cannot be done overnight.
Mr. KEATING. It can be done overnight now. There are many people available that were not available during the war.
Mr. SPINGARN. It is a question of getting qualified help. There are not so many people who would have the background to fit them to do this type of work. Last fall we had to
Mr. GRAHAM. Do you know when the next meeting of the subcommittee of the Committee on Appropriations is that will take this up?
Mr. SPINGARN. The Treasury subcommittee of the House Committee on Appropriations instructed us to take it up with this committee and we are doing so. We can do nothing further till we get a decision from this committee.
Mr. GRAHAM. All right.
Mr. SPINGARN. We submitted a budget estimate for $281,000 to comply with the Administrative Procedure Act. In view of the cir
cumstances which I have outlined, however, the Budget Bureau decided that, in the interests of efficiency and economy in Government, the estimate should be eliminated and an amendment to the Adminis trative Procedure Act sought. We fully agree. At the same time I want to say that we recognized that there are arguments on both sides. We knew you gentlemen of the Judiciary Committee had worked hard and given a great deal of thought to the Administrative Procedure Act and we frankly therefore did not want to be in the position of making the first move to get an exemption from that act. However, the Bureau of the Budget struck out that appropriation estimate on the ground of economy and they inserted legislative language which would have granted this exemption.
When we went before the House Appropriations Committee we presented this same issue.
Mr. KEATING. There was no item in the budget as submitted for that?
Mr. SPINGARN. No, sir. As it went from the Treasury to the Budget, the item was included. The Budget struck out the item on the ground of economy. When it went to the committee there was still this legislative language this exemption. I told the House Appropriations Subcommittee at that time, and I am quoting from pages 664 and 665 of those hearings:
I want to say that the House Judiciary Committee and the Senate Judiciary Committee did a lot of work on the Administrative Procedure Act and the American Bar Association and the lawyers of the country are very much interested in that act.
Some of you gentlemen also may have some personal interest in it. We have worked very hard to comply with the spirit and letter of the act. I can vouch for that myself.
This is a case where economy and the Administrative Procedure Act locked horns. You have to take one or the other, but I just want to call to your attention that this committee may want to take the matter up with the House Judiciary Committee and discuss the whole thing. We do not want to be in the position of creeping in through the back door, as it were, with an exemption from the Administrative Procedure Act. We were in the position where we had to make a decision while the Congress was away, and there was no opportunity to discuss this with the legislative committee that had jurisdiction over the act.
Well, the House Appropriations Committee considered that matter and in their committee report, which is House Committee Report No. 103, Eightieth Congress, they give us the following indication, and I am quoting from that report, page 17:
A proposal of new language for 1948 was incorporated in the Budget estimates designed to amend section 7 (a) of the Administrative Procedure Act of 1946. The effect of the language would have been to permit commissioned officers of the Coast Guard, rather than civilians, to conduct hearings connected with the operations of the merchant marine. It was represented to the committee that if this language were approved, it would circumvent a future expenditure of upward of $200,000 which otherwise would eventuate, if amendment of existing law does not take place prior to June 11 of this year. The committee has deleted the proposed language from the bill solely because of the fact that it represents a chanoge in existing legislation and hence, is without the proper purview of the Appropriation Committtee. In making the elimination, however, it is to be understood that the committee neither approves nor disapproves the legislative proposal involved in the proposed change. This is an important matter, and it is hoped that the Treasury Department will make prompt representation to the appropriate legislative committee of the House, in order that due consideration can be given to the merits of the proposal prior to the date (June 11, 1948) (this date should read "June 11, 1947") when the provisions of the Administrative Procedure Act become applicable to this question.