Friday, February 15, 2013

admin. law - body that did not hear case CAN decide facts w/o violating due process

Graff v. DPW - Cmwlth. Court - November 21, 2011 - unreported memorandum decision

Claimant contends that the Secretary lacked authority to alter the ALJ‟s factual finding that she was permanently disabled by her work injury. The Department counters that the Secretary is vested with final fact-finding authority, and, thus, error did not occur.

In Siemon’s Lakeview Manor Estate v. DPW, 703 A.2d 551, 553-554 (Pa. Cmwlth. 1997), the Secretary reversed the factual findings of the Bureau in holding that a nursing facility was not entitled to reimbursement of certain costs associated with nursing care services. The nursing facility appealed to this Court, claiming that the Secretary did not have authority to reverse the Bureau's factual findings.

In deciding this legal issue, we reviewed the applicable statutes and regulations. Section 206 of the Administrative Code of 1929, provides that the Secretary of Public Welfare shall "personally" or through a "duly authorized agent" carry out his duties as agency head. 71 P.S. § 66. The General Rules of Administrative Practice and Procedure, which govern hearings before state agencies, such as the Department, authorize the "agency head" to personally conduct hearings or to appoint a presiding officer to conduct hearings. 1 Pa. Code §§35.123, 35.185. Here, the legislature has expressly made "the Secretary" the "head" of the Department. 71 P.S. §66. Consistent with these principles, we held that even though the Secretary did not view the demeanor of witnesses, this did not preclude the Secretary from exercising final fact-finding authority.

Again, in A.O. v. Department of Public Welfare, 838 A.2d 35 (Pa. Cmwlth. 2003), we reiterated that the Secretary, as the agency head, is vested with fact-finding authority. We further explained as follows:

While a fact finder‟s observation of the demeanor of a witness has traditionally been viewed as an important factor in determining credibility, administrative adjudicators are permitted to determine the credibility of testimony from the reading of a transcript. Administrative agencies often use a system of adjudication where a hearing examiner or presiding officer takes evidence and the ultimate fact finder is a board or commission, which has the power to make findings of fact based solely on a review of the record. See, e.g., Kramer v. Department of Insurance, 654 A.2d 203 (Pa. Cmwlth. 1995) (presiding officer conducted an evidentiary hearing, but the adjudication was issued by the Insurance Commissioner); … An adjudicative method where the ultimate decision in a case is made by an administrative fact finder who did not hear the testimony does not deny a litigant due process of law. Id.
at 38, n.5 (emphasis added) (citation omitted).  
More recently in Duvall v Department of Corrections, 926 A.2d 1220 (Pa. Cmwlth. 2007), we considered whether the Secretary of Corrections could reject a hearing examiner‟s factual findings made in a hearing to determine eligibility for Heart and Lung benefits. The Secretary found that the claimant had fully recovered and was able to return to work. The claimant appealed to this Court, arguing that the Secretary could not make credibility determinations contrary to those of the hearing examiner. We disagreed, explaining that the hearing examiner was merely the designee of the Secretary, who was "the ultimate finder of fact in the instant matter" and able to make different credibility determinations. Id. at 1225.

We reject Claimant's contention that it was impermissible for the Secretary to make new factual findings, including credibility determinations, that differed from those of the administrative law judge appointed to take evidence and make the record for the Secretary. The contrary principle has been well established in legislation, regulations and case law precedent.

The opinion, though not reported, may be cited "for its persuasive value, but not as binding precedent."
210 Pa. Code § 67.55. Citing Judicial Opinions.

Legislation - unlawful delegation of legis. power - due process right to a hearing

MCT Transp. v. Phila. Parking Authority – Cmwlth – 2-14-13 – en banc (39 pp.)
Statute establishing process by which licensing fees are established, 53 P.S. 5707(b), held unconstututional, because
      - unconstitutional delegation of legislative power – no legis. standards to guide or restrain setting of licensing fees by administrative body
      - lack of due process, stemming from lack of the opportunity to challenge the licensing fee decision at a hearing.

 Unconstitutional delegation
Article II, Section 1 of the Pennsylvania Constitution vests legislative power in a General Assembly.8 Legislative power is the power to make a law and, thus, the General Assembly “cannot constitutionally delegate the power to make law to any … other body or authority.” . . . . However, it can “make a law to delegate a power to determine some fact or state of things upon which the law makes, or intends to make, its own action depend.” . . . The legislature must make the basic policy choices, but it can “impose upon others the duty to carry out the declared legislative policy in accordance with the general provisions” of the statute.  In that situation, “it is the legislature which has legislated and not the administrative body.”  When conferring power on an agency to decide the facts and apply the law to a particular situation, the legislature must establish the standards for exercising that power.
We hold that Section 5707(b) is unconstitutional. The General Assembly has failed to establish standards directing the Parking Authority’s exercise of discretion in deciding how much to spend each year to regulate common carriers providing taxicab and limousine service in Philadelphia.  Additionally, the General Assembly has given the Parking Authority “no standards to guide or restrain [it] in setting fees” in any fashion whatsoever. . . . .Because Section 5707(b) lacks standards to guide the establishment of an annual budget and fee schedule, it delegates legislative power to the Parking Authority, in violation of separation of powers.
Due Process – right to a hearing
The Taxicab Companies contend that Section 5707(b) unconstitutionally deprives them of due process because it does not provide any procedure for challenging the Parking Authority’s fee schedule, either before or after its adoption. We agree. . . . The Fourteenth Amendment to the United States Constitution and Article I, Section 1 of the Pennsylvania Constitution guarantee due process of law before the state can deprive an individual of a protected life, liberty or property interest. . . . The right to pursue a livelihood or profession is a protected property interest that triggers procedural due process. . . . As our Supreme Court has explained, the “Constitution guarantees to those who invest their property in business enterprises that it will not be taken without due process of law.” . . . . The “essential elements [of due process] are notice and opportunity to be heard and to defend in an orderly proceeding adapted to the nature of the case before a tribunal having jurisdiction of the cause.”

The Court began with the observation that it is a “fixed principle in our law that no man shall be adjudged in person or property without notice and an opportunity to appear and be heard. To condemn without a hearing is repugnant to due process.” . Because due process applies to administrative officials, “there must be a hearing somewhere, at some stage in the proceeding, even if it be after the property itself is parted with,” in order for the agency’s action to comport with due process. Section 5707(b) requires the Taxicab Companies to pay a fee to the Parking Authority if they wish to stay in business. The fee can be excessive and confiscatory, but there is no relief to the utilities subject to such a fee. The Taxicab Companies cannot challenge the fee schedule in a hearing “at any stage in the process,” either before or after the fee schedule becomes effective. . . .  To “condemn without a hearing is repugnant to the due process clause.” . Accordingly, we hold that Section 5707(b) is unconstitutional.