The Future of Chevron Deference III: The Weakness of the Anti-Chevron Arguments

In previous posts I have set out reasons to doubt the prospects for the continued longevity of Chevron deference but I have also explained why these reasons for doubt should be not be over-stated. In this post, I outline the principal arguments of the anti-Chevron advocates, with particular reference to the opinion of then-Judge Gorsuch in Gutierrez-Brezuala. I focus on this opinion because it succinctly states and relies on the standard anti-Chevron arguments and also because, having now ascended to the bench of the Supreme Court, Justice Gorsuch’s views are likely to be particularly influential in the coming years, when Chevron’s vitality will surely be put to the test.

Justice Gorsuch’s opinion opens in fine style, praising the wisdom of the Framers of the U.S. Constitution for their development of a separation of powers designed to facilitate wise governance and protect individual liberty. Deference to administrative decision-makers’ interpretations of law would, for him, send a coach and horses through this considered constitutional design. Three distinct arguments run through his opinion.

First, Chevron eliminates a core function of the judiciary, to declare “what the law is”. Chevron is “no less than a judge-made doctrine for the abdication of the judicial duty”. This constitutionally grounded concern about judges not exercising their “independent judgment about what the law is” is supported by the text of the Administrative Procedure Act (legislation providing, amongst other things, for judicial review of federal administrative agencies), which empowers courts to “interpret” statutory provisions. For Justice Gorsuch, Chevron upends the constitutional and legislative design by “allow[ing] an executive agency to resolve the meaning of any ambiguous statutory provision”.

But the very point of Chevron deference is that it does require judges to interpret statutes. In Chevron itself, Justice Stevens envisaged two situations in which a court might be obliged to defer to an administrative agency’s interpretation of law: where there has been an express delegation of authority by Congress to an agency to interpret a statute; or where there was an “implicit” “legislative delegation to an agency on a particular question” (at pp. 843-844). Where a delegation is implicit, “an agency to which Congress has delegated policymaking responsibilities may, within the limits of that delegation, properly rely upon the incumbent administration’s views of wise policy to inform its judgments” (at p. 865, emphasis added). On Chevron’s own terms, a reviewing court is intimately concerned with whether and to what extent the legislature has delegated a task to the administrative agency in question. Moreover, since Chevron, the Supreme Court has developed a contextual analysis — the famous Chevron step zero — to determine whether Congress “intended” a particular type of agency decision “to carry the force of law” and thus qualify for Chevron deference (United States v Mead Corporation 533 US 218, at p. 221, per Souter J (2001)).

What Chevron asks a reviewing court to determine is whether, taking all relevant statutory provisions into account — including those establishing the agency in question, setting out its powers and field of operation and delegating policy-making responsibilities to it — deference would be appropriate, because Congress can be said to have intended it. Indeed, I have argued that deference to administrative interpretations of law can be justified “based on the…constitutional principle that courts must give effect to legislative intent” (Daly, A Theory of Deference in Administrative Law: Basis, Application and Scope (CUP, 2012), at p. 72), taking into account the scope of the delegation of authority and also practical justifications for deference, including agency expertise.

Once the basic point about the importance of legislative intent is appreciated, the apparent conflict between Chevron deference and judicial duty and the text of the Administrative Procedure Act dissolves. Moreover, as the Supreme Court of Canada observed, when addressing a similar problem, “most if not all judicial review statutes are drafted against the background of the common law of judicial review”, such that a legislatively mandated requirement to “interpret” statutes cannot plausibly be read in a narrow, textualist manner (Canada (Citizenship and Immigration) v. Khosa, [2009] 1 SCR 339, at para. 19).

In general, those who, like Justice Gorsuch, fear that doctrines of deference undermine the judicial role put undue emphasis on individual statutory provisions. Their concern seems to be that requiring deference on (say) section 382(4) of a lengthy and complex statutory scheme undermines the judicial role. With respect, this is a category mistake: judges who are concerned to give effect to legislative intent should not read individual statutory provisions in isolation, but understand the provisions’ place in the statute as a whole. Once this has been understood, the conclusion will often follow that, having regard to the scope of the delegation of authority to the agency and the practical justifications for deference, the best reading of the statutory scheme is that the legislature intended any reviewing court to defer to the administrative decision-maker’s interpretation of law.

Second, Chevron deference is thought to raise due process concerns, by requiring the courts to put a judicial thumb on the scales, in favour of the government party:

Transferring the job of saying what the law is from the judiciary to the executive unsurprisingly invites the very sort of due process (fair notice) and equal protection concerns the framers knew would arise if the political branches intruded on judicial functions.

For the most part, however, this concern is answered by reference to legislative intent. A reviewing court might be obliged to favour an administrative agency’s interpretation of law over a competing interpretation offered by one of the parties or even the court itself, but the obligation results from the relevant statutory provisions. In other words, the thumb on the scales is not the court’s; it is the legislature’s. This involves no partiality, still less any violation of equal protection principles, as the same law applies to all administrative agencies and all individuals.

Moreover, concerns for non-arbitrariness and due process permeate all areas of administrative law. Chevron is no exception. Consider the Supreme Court’s decision in Encino Motorcars LLC v Navarro, 579 US ________ (2016). Giving the majority opinion, Justice Kennedy refused to accord Chevron deference to the Department of Labor’s interpretation of the Fair Labor Standards Act, in a case concerning whether service advisors in car dealerships are entitled to overtime pay when they work more than 40 hours a week. As Justice Kennedy explained, Chevron deference should not be accorded “where the agency errs by failing to follow the correct procedures in issuing the regulation” (slip op. at p. 8). The “basic procedural requirement” flouted here was that “an agency must give adequate reasons for its decisions” (slip op. at p. 9). The absence of a “reasoned explanation” of its change of position rendered the Department’s decision arbitrary and capricious (slip op. at p. 9):

In promulgating the 2011 regulation, the Department offered barely any explanation. A summary discussion may suffice in other circumstances, but here—in particular because of decades of industryreliance on the Department’s prior policy—the explanation fell short of the agency’s duty to explain why it deemed itnecessary to overrule its previous position (slip op. at p. 10)

To put the point another way, when an administrative agency interprets a statute, it is subject to the constraints of non-arbitrariness and due process. Indeed, these are more restrictive constraints than those imposed on private individuals. Once the bigger picture is considered, Justice Gorsuch’s concerns about due process and equal protection melt away. The same is true of Canada’s deference regime. As Miller JA observed in Pong Marketing and Promotions Inc. v. Ontario Media Development Corporation, 2018 ONCA 555 an administrative decision-maker’s interpretation of a statute must be “reasonable” (at para. 50) and “consistent with the rest of the law as a whole” (at para. 48).

Third, the modern administrative state is characterised by a concentration of legislative, executive and judicial functions. In the lurid imagination of the anti-Chevron camp, agencies are legislator, judge, jury and executioner. Already, “even without Chevron”, this is a menace to individual liberty, inasmuch as administrative agencies can “penalize persons in ways that can destroy their livelihoods and intrude on their liberty even when exercising only purely civil powers”. There certainly is some truth behind this charge: modern regulatory statutes are long, complex and relatively freely impose liability on individuals. But that, with respect, is not the fault of the administrative state; it is the fault of legislators. Whether these liabilities were to be imposed by administrative agencies or judges, they would be equally objectionable.

More importantly, the argument tends to mischaracterise the nature and role of judicial review. Justice Gorsuch reserves particular ire for the Supreme Court’s decision in National Cable and Telecommunications Association v Brand X 545 US 967 (2005), where the Court held that an administrative agency is entitled to change its interpretation of a statute, provided that the new interpretation is reasonable and not clearly foreclosed by the text of the statutory provision. For Justice Gorsuch, Brand X legitimates the “unconstitutional revision of a judicial declaration of the law by a political branch”. But any such “revision” would have to be non-arbitrary and contain, as in Encino, a reasoned explanation of the change of position.

Implicit in this misguided criticism is the view that within the boundaries of reasonableness, administrative agencies have an unfettered policy choice between different, reasonable interpretations of law. In turn, this view is based on a formal distinction between questions of law (for the courts) and questions of policy (for administrative agencies). For Justice Gorsuch the law ‘runs out’ as soon as a court determines statutory language to be ambiguous or vague. So, if an agency changed its interpretation of a statute without giving reasons, applied it in a disproportionate manner, or choose one of a number of competing interpretations by consulting tarot cards or tealeaves, the courts could not intervene, for courts are limited to the domain of law and may not enter the domain of policy choice. This is misconceived. The courts are not limited to defining the outer range of statutory language, leaving everything inside the range to unfettered administrative discretion. Judges are entitled to police what an administrative agency does within the range, to ensure it is (in the United States) not arbitrary and capricious and (in Canada) “reasonable” and “consistent with the rest of the law as a whole”. It is simply wrong to suggest, as Justice Gorsuch does, that an administrative agency can, under Chevron and Brand X “reverse its current view 180 degrees anytime based merely on the shift of political winds and still prevail”. A reasoned explanation is required, one that must satisfy a reviewing court.

A final comment is in order. Justice Gorsuch’s arguments are underpinned by historical considerations, which have particular weight in the American context, because the constitutional doctrine of originalism is taken seriously by almost all participants in debates about public law. For Justice Gorsuch, the American founders were “wary” of the “costs” of deference on questions of law, “knowing that, when unchecked by independent courts exercising the job of declaring the law’s meaning, executives throughout history had sought to exploit ambiguous laws as license for their own prerogative”. This observation is perfectly valid, so far as it goes: executive prerogatives have progressively been tamed and reined in over the years, across the common law world. But it does not go very far. In particular, the idea that the existence of administrative agencies and judicial deference to them are historical anomalies does not withstand scrutiny.

In his magisterial book on the origins of administrative law, Professor Mashaw demonstrates that administrative agencies were a feature of American life from the founding period forward. Professor Craig, similarly, has shown that administrative decision-makers dotted the English legal landscape for centuries before the emergence of the “administrative state” as an object of scholarship and criticism.

Mechanisms of judicial control of administrative agencies have also long existed, in the form of tort and criminal liability and the prerogative writs. There was a “bipolar approach”, with the “common law system of de novo review in damage actions and criminal prosecutions” and the “extreme reticence of courts to interfere with administrative judgments by writs of mandamus or injunction” (Mashaw at p. 210). With respect to the former, it was understandable that judges would consider issues of law de novo. With respect to the latter, however, the suggestion that judges would invariably opine on the content of the law is extremely dubious: the writ of certiorari would not go to errors within jurisdiction, especially when the decision-maker was protected by a privative clause; and, in the United States, the writ of mandamus was applied in a highly deferential manner. With respect, it is — again — a category mistake to treat the liability in tort of officials as determinative of the judicial role in controlling public administration. In the common law tradition, the prerogative writs played a prominent role. Properly accounting for this role leads to a much more nuanced conclusion about the judicial “duty” to interpret the law.

This content has been updated on March 7, 2019 at 15:29.