–José Ignacio Hernández, Constitutional and Administrative Law Professor, Catholic University and Central University (Venezuela). Invited Professor, PUCMM (Dominican Republic), Castilla La Mancha and La Coruña (Spain), Senior Associate, Center for Strategical and International Studies.
In the Loper Bright case[1], the Supreme Court overruled Chevron, stating that “Courts must exercise their independent judgment in deciding whether an agency has acted within its statutory authority.” This decision was not made in isolation. On the contrary, as we have explained elsewhere[2], the Supreme Court has adopted a constitutional interpretation that considers agencies to be only “creatures of the statute” and that they can only exert the authority “delegated” by Congress.[3] To limit this delegation, the Supreme Court also ruled that in cases of “vast economic and political significance,” judicial review must recognize that agencies are limited to exercising authority strictly delegated by Congress. This interpretation, known as the “major questions doctrine,” has been applied to rulemaking, adjudicatory powers, and welfare policies. [4]
At the core of Loper Bright, we can identify traces of this constitutional interpretation. Those traces consider that Article III and the judicial review prevail over agencies. From this perspective, the statutes´ interpretation by agencies under the Administrative Procedure Act (APA) is not given any deference. Even in cases of statutory ambiguity, courts should not defer to agencies because “agencies have no special competence in resolving statutory ambiguities. Courts do” (at 14). As some concurring votes highlighted, this constitutional interpretation of the separation of power applies to favor judicial review over rulemaking and adjudication.[5]
However, at the same time, there are other passages that acknowledge that Congress may authorize agencies to “exercise a degree of discretion” (at 17). In those cases, courts stay “out of discretionary policymaking” (at 26).
Unfortunately, the Supreme Court seemed more focused on explaining why the Chevron doctrine is incompatible with the law rather than elaborating on how deference applies to discretionary authority. As a result, Loper Bright failed to address the fundamental issue: The constitutional basis of Administrative Law and the level of deference resulting from the separation of powers.
Considering the difference between statutory ambiguity and administrative discretion as briefly outlined by the Court, we propose a constitutional interpretation of Loper Bright inspired by the traditional distinction in Latin American Administrative Law between undetermined legal concepts and administrative discretion. More precisely, we are interested in the Hispanic tradition.[6] Generally, judicial review offers no deference in this tradition when the law uses ambiguous or undetermined concepts. However, judicial review is limited (never excluded) when the Law grants discretionary powers. This distinction is based on a constitutional interpretation of the separation of powers, according to which only the public administration within the Executive Branch has the authority to serve the people and promote the practical realization of government tasks.[7]
In this post, we will shed new light on the constitutional implications of Loper Bright using a comparative approach.[8] For that purpose, we explain the three levels of the relationship between administrative action and the law in the Hispanic tradition. Then, we suggest a reading on Loper Bright that differentiates the vague or undetermined legal concepts and administrative discretion.
The three levels of the lex and the jus: discretionary powers and the constitutional constraints on judicial review
Article 107.3 of the Spanish Constitution differentiates between subordination to the law approved by the Legislative (“Ley” or lex) and subordination to the legal system (“Derecho” or jus). A similar provision can be found in Article 138 of the Dominican Republic Constitution, which contemplates the subordination of the public administration to the juridical order (and not only to the laws or statutes). Also, Article 209 of the Colombian Constitution states that public administration serves the general interests, a task that cannot be reduced to the automatic implementation of the Law.[9]
The Law cannot exhaust the decision-making process, which leads to Legislative gaps provide the flexibility that public administration requires to fulfill its constitutional mandates. However, even in those gaps, administrative action is constrained by general principles. Therefore, in Hispanic American Constitutional Law, it is necessary to differentiate between the law (lex) and the general principles of law (jus). [10]
Based on those considerations, the constitutional relationship between the Executive, the Legislature, and the Judiciary is founded on three levels: (i) the allocation of the decision-making process, (ii) the scope of action of the public administration regarding discretionary powers, and (iii) the judicial review. As we will explain, those levels could suggest a reading of Loper Bright.
The first level involves the allocation of the decision-making process. As I explained elsewhere[11], the Constitution specifies certain decisions that, due to their relevance, can only be adopted by the Legislative Branch (the principle of legal reserve).
The second level defines the scope of action of the public administration within the boundaries defined by the Legislature, considering the discretionary powers. Following the Italian doctrine, Hispanic American Law distinguished between technical and administrative discretionary powers:[12]
- Technical discretion applies where legislation uses undetermined concepts of a scientific or technical nature. The classic example is the police power that the Law vests in the public administration to determine when a building is ruined. The concept of “ruin” is not defined in the law and requires a margin of appreciation from the public administration.
- Administrative discretion refers to the authority the Law grants the public administration leeway to interpret the general interest and make policy decisions [13]
The third level involves judicial review and the relationship between public administration and the Judiciary. While the judiciary can review questions of law and facts, it cannot review the discretionary powers of the public administration. In other words, the judiciary cannot make policy decisions in matters related to the common good, as this is the responsibility of the public administration, which acts as a stewardship organization. This is the constitutional margin of deference intended to protect the inherent constitutional functions vested in the Executive. Two precisions should be made:
- The judicial review constraint does not apply to technical discretion when the Law uses vague or undetermined concepts. In these cases, judicial review can determine whether administrative decisions comply with the Law because vague statutory concepts do not involve policy choices. In some Hispanic countries, technical discretion receives a deferential review based on the public administration’s ability to determine vague concepts, particularly when the Law grants a margin of appreciation to construe those concepts.[14]
- Administrative discretion, on the other hand, involves policy choices that only the public administration can make. Nevertheless, this does not mean the administrative action is immune from judicial review. Judicial review can ensure that administrative actions comply with the Law and control the public administration’s arbitrariness. For example, in Costa Rica, judicial review is based on the standard of arbitrariness specified in Articles 160 and 261(1) of the Administrative Procedure Act.[15]
This framework -here explained only from a broader perspective- provides a reading of Loper Bright that could balance the constitutional requirements of the modern administrative state with the rule of law.
The Loper Bright doctrine: vague statutory concepts and discretionary authority
According to Hispanic American Law, an alternative interpretation of Loper Bright suggests that the separation of powers not only protects the Judiciary from the Executive but also safeguards the constitutional powers vested in the Executive. This conclusion does not imply that areas of administrative action are not subject to judicial review; instead, it recognizes the constitutional constraints on judicial review to preserve the powers that Art. II vests in the Executive and the agencies.
For that purpose, we could follow a similar approach to the three levels previously explained:
- The statute must grant the agencies the authority to exert regulatory powers (through rulemaking or adjudication). As Loper Bright concluded (at 29), this first level answers “the question that matters: Does the statute authorize the challenged agency action?”.
- In case of statutory ambiguities, courts should exert a de novo review, because “ambiguity is not a delegation to anybody, and a court is not somehow relieved of its obligation to independently interpret the statute” (at 22). The term “statutory ambiguity” could be interpreted similarly than the “undetermined legal concepts” in Hispanic America. That is, technical concepts that the statute uses -for instance, regarding environmental protection- that should be determined by agencies. As Loper Bright concludes, “instead of declaring a particular party’s reading “permissible” in such a case, courts use every tool at their disposal to determine the best reading of the statute and resolve the ambiguity” (at 23). Eventually, the law could give agencies the discretion to interpret vague concepts. That margin of appreciation, not the statute´s ambiguity, provides the legal basis for exercising judgment.
- Congress can grant discretionary authority to agencies subject to constitutional limits. In that case, courts should “stay out of discretionary policymaking”, which does not mean absolute immunity from judicial review. On the contrary, courts must “fulfill their obligations under the APA to identify and respect such delegations of authority independently, police the outer statutory boundaries of those delegations, and ensure that agencies exercise their discretion consistent with the APA” (at 26). As explained, the statute could grant this authority to construe vague concepts.
The difference between both institutions could be understood through the thought of the Spanish jurist Eduardo García de Enterría.[16] In the first case (vague concepts), there is only one decision the agencies can adopt based on scientific or technical knowledge. That is, exactly, the conclusion adopted in Loper Bright: “resolution of statutory ambiguities involves legal interpretation. That task does not suddenly become policymaking…” (at 26).
In the second case (discretionary ambiguity), agencies could make multiple just choices. As a result, judicial review cannot invade the policy space (although it should review the discretionary decision based on the APA). Loper Bright can be interpreted within this context: “When the best interpretation of a statute is that it delegates discretionary authority to an agency, the role of the reviewing court under the APA is, as always, to independently interpret the statute and carry out the will of Congress within constitutional limits“. Judicial review of discretionary authority relies heavily on the court´s power to deem unlawful and set aside agency action, findings, and conclusions deemed arbitrary, capricious, or an abuse of discretion.
Therefore, from the Hispanic tradition, the leading challenge that Loper Bright made about Chevron is accurate: statutory ambiguity is not, per se, a legal entitlement for discretionary authority. The statute must grant that authority expressly, even to construe vague concepts based on policy reasons.
***
The overturning of the Chevron doctrine by Loper Bright did not resolve the issue of the degree of deference based on the constitutional principles of Administrative Law, which is a problem of constitutional interpretation.[17] In that sense, U.S. Administrative Law is yet to achieve the objective that, almost fifty years ago, Eduardo García de Enterría pointed out: to “recognize that the Administration (and even more, an Administration with vast welfare tasks to provide essential assistance to its population) necessarily requires administrative powers with a margin of deference from the judiciary”.[18]
Suggested citation: José Ignacio Hernández, After Chevron: The Constitutional Foundations of U.S. Administrative Law from a Comparative Latin American Perspective, Int’l J. Const. L. Blog, Jul. 3, 2024, at: http://www.iconnectblog.com/after-chevron-the-constitutional-foundations-of-us-administrative-law-from-a-comparative-latin-american-perspective/
[1] Loper Bright Enterprises et al v. Raimondo, Secretary of Commerce, et al., ___ U.S. ___ (2023) (decided together with Relentless, Inc., et al. v. Department of Commerce, et al.).
[2] See José Ignacio Hernández G., The Major Questions Doctrine and the Principle of Legal Reserve: A Comparison between the U.S. and Spain, Int’l J. Const. L. Blog, Apr. 12, 2023, at: http://www.iconnectblog.com/2023/04/the-major-questions-doctrine-and-the-principle-of-legal-reserve-a-comparison-between-the-us-and-spain/
[3] West Virginia v. Environmental Protection Agency, ___ U.S. ___ (2022).
[4] See Biden v. Nebraska, ___ U.S. ___ (2023).
[5] The main critics on the Chevron doctrine relies, precisely, in its incompatibility with the separation of powers. Generally, see Merrill, Thomas (2022), The Chevron doctrine. Its rise and fall, and the future of administrative law, Cambridge: Harvard University Press, 55 y ss.
[6] Hispanic America refers to the comparative study of the Constitutional Law in Spain and Spanish American (excluding, then, the study of Portugal and Brazil). The justification of this comparative approach is the shared constitutional root adopted since the 19th century. To clarify, the Hispanic American Constitutional Law is consequence of a comparative approach that considers what Vicky Jackson called common roots. Jackson, Vicky C., “Comparative Constitutional Law: Methodologies”, in Rosenfeld, Michel and Sajó, András (ed) (2012), The Oxford Handbook of Comparative Constitutional Law, Oxford: Oxford University Press, 54
[7] From a Constitutional Law perspective, we should bear in mind that the Administrative Law applies, in the Hispanic American tradition, to the public administration within the Executive. That is one of the main differences with the U.S. Administrative Law, limited only to the agencies. See Schwartz, Bernard (1984), Administrative Law, Boston: Little, Brown and Company, 2-3.
[8] Besides the problem of constitutional interpretation, U.S. Administrative Law is too influenced by its “exceptional nature” that precludes the comparative approach. Tamir, Oren, Our Parochial Administrative Law (September 7, 2023). 97 Southern California Law Review (2024, Forthcoming), Available at SSRN: https://ssrn.com/abstract=4564877 or http://dx.doi.org/10.2139/ssrn.4564877 (retrieved: 6.30.24).
[9] Santofimio Gamboa, Jaime Orlando (2023), Compendio de Derecho Administrativo, Bogotá: Universidad Externado, 216.
[10] García de Enterría, Eduardo (1963) “Reflexiones sobre la Ley y los principios generales del Derecho en el Derecho administrativo”, in 40 Revista de Administración Pública, 198.
[11] See José Ignacio Hernández G., The Major Questions Doctrine and the Principle of Legal Reserve: A Comparison between the U.S. and Spain (n 2).
[12] Brewer-Carías, “Estudio Preliminar. El procedimiento administrativo en el Derecho Administrativo comparado Iberoamericano”, in Punzón Moraleda, Jesús, et al (ed) (2021), Código de Leyes de Procedimiento Administrativo en Iberoamérica, Caracas: Editorial Jurídica Venezolana, 53-57.
[13] Bacigalupo, Mariano, “La vinculación de la Administración Pública a la Ley y al Derecho”, in Velasco, Francisco and Darnaculleta, Mercè (ed), Manual de Derecho Administrativo, Madrid: Marcial Pons, 137.
[14] Arroyo Jiménez, Luis (2024), “Control judicial y deferencia en el Derecho Administrativo”, in 9 Revista de Derecho Público: Teoría y Método, 144-149.
[15] Brewer-Carías, Allan (2019), La justicia administrativa en América Latina, Santiago de Chile: Ediciones Olejnik, 60. We are analyzing this theory from a broader and more general perspective. There are many specifications and details to consider.
[16] García de Enterría, Eduardo (1962), “La lucha contra las inmunidades del poder en el Derecho administrativo (poderes discrecionales, poderes de gobierno, poderes normativos)”, in 38 Revista de Administración Pública número 38, 159.
[17] The criticism against the sole recognition of a margin of deference demonstrates a problem of constitutional interpretation. See Sunstein, Cass (2023), How to interpret the Constitution, Princeton: Princeton University Press, 8-9.
[18] García de Enterría, Eduardo (1978), “Algunas reflexiones sobre el Derecho Administrativo norteamericano. A propósito de una nueva exposición sistemática del misma”, in 85 Revista de administración pública, 241.
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