Formal vs informal adjudication
📌 Formal vs. Informal Adjudication
Formal Adjudication
Governed by APA §§ 554, 556, 557.
Required when a statute mandates a decision “on the record after opportunity for an agency hearing.”
Looks like a trial: testimony under oath, cross-examination, record evidence, and presided over by an Administrative Law Judge (ALJ).
Example: NLRB unfair labor practice hearings, immigration removal hearings.
Informal Adjudication
Used when statutes do not require “on the record” hearings.
Much more flexible; agencies can rely on inspections, paper records, staff evaluations, or conferences.
No strict trial-type procedures, though due process still applies in some contexts.
Example: Social Security disability benefits, licensing approvals, certain enforcement actions.
📚 Major Case Laws
1. United States v. Florida East Coast Railway Co. (1973)
Facts: The ICC (Interstate Commerce Commission) set rates for railroad freight cars. Railroads argued that this required a “hearing on the record.”
Issue: Does “hearing” in a statute automatically trigger formal adjudication?
Holding: No. Supreme Court said “on the record” language is necessary to mandate formal adjudication.
Significance: Clear line—without “on the record,” agencies can use informal adjudication.
2. Goldberg v. Kelly (1970)
Facts: Welfare recipients challenged the termination of benefits without prior hearings.
Issue: Did due process require a trial-type hearing before termination of welfare benefits?
Holding: Yes. The Court held that due process requires an evidentiary hearing before cutting benefits, because welfare is a matter of survival.
Significance: Even though informal adjudication was the norm in welfare, due process constitutionalized a trial-like process. This blurred lines between formal and informal adjudication.
3. Mathews v. Eldridge (1976)
Facts: Eldridge challenged termination of Social Security disability benefits, demanding a pre-termination hearing like Goldberg.
Holding: Court ruled no pre-termination oral hearing required; written submissions and post-termination review were sufficient.
Significance: Created Mathews balancing test (private interest, risk of error, government’s interest).
Shows that informal adjudication does not always require trial-like hearings, unlike Goldberg.
4. Londoner v. Denver (1908)
Facts: Property owners objected to a special tax assessment imposed by Denver. They argued lack of hearing.
Holding: Supreme Court held due process requires an opportunity for an oral hearing because assessment affected a small number of individuals with unique claims.
Significance: Early recognition of quasi-judicial (formal-like) due process requirements in adjudication.
5. Bi-Metallic Investment Co. v. State Board of Equalization (1915)
Facts: Colorado increased property tax assessments across the board without individualized hearings.
Holding: No due process right to a hearing when a rule or policy affects a large number of people generally.
Significance: Contrasts with Londoner. Helps distinguish adjudication (individualized) vs. rulemaking (generalized).
Thus, if it’s a large-scale action, agencies may rely on informal processes.
6. Seacoast Anti-Pollution League v. Costle (1st Cir. 1979)
Facts: EPA issued permits under the Clean Water Act. The Act required a “public hearing,” but did not say “on the record.”
Holding: Court ruled that “hearing” could imply a formal adjudication, even without “on the record.”
Significance: Seacoast went beyond Florida East Coast Railway—leaning towards presumption of formality when hearings are required.
Later cases criticized this, but it highlights ongoing tension.
7. Dominion Energy Brayton Point v. Johnson (D.C. Cir. 2007)
Facts: Similar EPA permitting issue.
Holding: D.C. Circuit rejected Seacoast and reaffirmed Florida East Coast Railway—that only explicit “on the record” language triggers formal adjudication.
Significance: Cemented the modern rule: formality only when Congress clearly says so.
🔑 Key Takeaways
Formal adjudication = APA §§ 554–557 + “on the record” language.
Informal adjudication = default mode unless statute says otherwise.
Due Process Overlay (cases like Goldberg and Mathews) can force trial-like procedures even in informal contexts.
Londoner vs. Bi-Metallic = foundational distinction: individualized vs. general action.
Courts like Florida East Coast Railway and Dominion Energy limit formal adjudication to clear statutory triggers, while cases like Seacoast briefly expanded it.
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