Rejecting Auer: The Utah Supreme Court Shows the Way, by James Phillips & Daniel Ortner

by Guest Blogger — Tuesday, Sept. 20, 2016

For decades, the Supreme Court of Utah reviewed agency action under either express or implicit “delegations of discretion” for abuse of discretion. This approach “proved difficult to apply” and resulted in widely inconsistent decisions that depended on whether a court found that a statute granted an implicit delegation of power. So in 2013 the Utah Supreme Court reevaluated its approach and drastically curtailed agency discretion in a unanimous opinion (Murray v. Utah Labor Comm’n). In doing so, the Court drew a distinction between questions involving “choice” or “discretion,” such as determining the proper tariff schedule, and mixed or legal determinations. With the former there “are a range of ‘acceptable’ answers,” and so the agency “is free to choose from among this range without regard to what an appellate court thinks is the ‘best’ answer.” On the other hand, with mixed or legal determinations there is “a single ‘right’ answer in terms of . . . the law.”

 

Subsequently, the Utah Supreme Court, in a unanimous opinion by Justice Thomas R. Lee, extended the reasoning of Murray and eliminated Seminole Rock/Auer-style deference to state administrative agencies. (Two years prior, Justice Lee writing for the court had also rejected Chevron­-like deference to agency interpretations of statutes.)

 

The court provided several rationales for its repudiation of deference to agencies’ interpretation of their own regulations. First, the court emphasized that agency actions are laws and the court is “in as good a position as the agency to interpret the text of a regulation that carries the force of law.” Second, the court raised concerns about the rule of law, noting that “parties have a right to read and rely on the terms of [agency] regulations,” and therefore “an agency has no authority to override the terms of an issued order by vindicating the agency’s ‘true’ intent.” Finally, the court noted that since the agency “is in the position of lawmaker … it makes little sense for us to defer to the agency’s interpretation of law of its own making.” The court cited to John Marshall’s famous lines in Marbury v. Madison: “It is emphatically the province and duty of the judicial department to say what the law is,” and noted that “plac[ing] the power to write the law and the power to authoritatively interpret it in the same hands … would be troubling, if not unconstitutional.”

 

Thus the Court relied on the Montesquieu-Madison-Marshall line of logic, a logic that is embedded in both the Utah and federal Constitution. Similar themes have been recently raised at the U.S. Supreme Court, such as Justice Thomas in Perez observing that Seminole Rock deference “effects a transfer of the judicial power to an executive agency . . . [and so it] undermines our obligation to provide a judicial check on the other branches, and it subjects regulated parties to precisely the abuses that the Framers sought to prevent.”

 

The principle of separation of powers—and its inherent logic that the judiciary will not defer to an agency’s interpretation of a law of the agency’s own making—may seem antiquated or naïve today. After all, the Framers set up our Constitution in a world far removed from the modern administrative state and its attempts to regulate an increasingly complex and inter-connected society. But whether separation of powers (and its fatal implication for Seminole Rock deference) is antiquated, or naïve, or even leads to unintended consequences, is, frankly, irrelevant—at least to the judicial branch—because it is a question of constitutional policy. And such questions in our system are left to the Sovereign—the People. So the People are free to match our Constitution to the age by amending it as they please. But that’s up to them. Not the courts. And until such amending occurs, the judicial branch is bound to follow the separation of powers. Justice Scalia put it better than we can in his Decker opinion: “[H]owever great may be the efficiency gains derived from [Seminole Rock] deference, beneficial effect cannot justify a rule that not only has no principled basis but contravenes one of the great rules of separation of powers: He who writes a law must not adjudge its violation.”

 

But what about stare decisis? Regardless of one’s theory of the Constitution, precedent gives away at some point. To paraphrase Abraham Lincoln, one does not have a right to do that which is unconstitutional. So unless one’s theory of the meaning of the Constitution, and thus the separation of powers, is it’s merely whatever the Supreme Court says it is, at some point the document itself has to supersede how it has been misinterpreted. (And if that is one’s theory, then a new majority on the Court is not really bound by an old one.) Given the fundamental importance of the separation of powers, we see this as one of those times where stare decisis cannot be allowed supersede constitutional text and structure.

 

We actually do not think the separation of powers to be antiquated or naïve or harmful (though it is arguably incompatible with our current administrative state). The Framers understood human nature, and how the granting of authority to one group of humans vis-à-vis another so often throughout history led to abuse of people’s rights and liberties. And the tendency towards abuse is not some historical relic. As Justice Scalia noted in his dissent in Morrison v. Olson, “Without a secure structure of separated powers, our Bill of Rights would be worthless, as are the bills of rights of many nations of the world that have adopted, or even improved upon, the mere words of ours.”

 

Thus recognizing the un-angelic aspects of humankind, especially those placed to “rule” in government, “auxiliary precautions” were designed to ensure the government will be “oblige[d] . . . to control itself.” That seems wise to us. But our view is also irrelevant. And that is the whole point. Whether one lauds it or loathes it, separation of powers is the “supreme Law of the Land.” Until that is no longer true, courts have no authority to delegate their job to independently say what the law is to anyone else. Maybe most especially to agencies. And thus Seminole Rock must fall. Because most if not all state constitutions are built on those same foundational principles, state supreme courts are free to take the lead and be more than just laboratories of democracy, but safeguards of democracy’s foundation—the separation of powers—after years of erosion by an encroaching administrative state. To do otherwise may be wise, it may be modern, it may be popular. But it would not be constitutional.

 

James Phillips graduated with his JD from UC-Berkeley in 2014, and clerked for Justice Thomas R. Lee on the Utah Supreme Court last term.

Daniel Ortner graduated with his JD from BYU in 2015, and clerked for Justice Thomas R. Lee on the Utah Supreme Court last term.

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This post is part of an online symposium entitled Reflections on Seminole Rock: The Past, Present, and Future of Deference to Agency Regulatory Interpretations. You can read the entire series here.

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