Opinion ID: 670650
Heading Depth: 2
Heading Rank: 2

Heading: The Reviewability of Ball's APA Claims

Text: 10 Paragraph I.7.9 of Ball's contract with the Bureau of Reclamation incorporated by reference [a]ll rulings and interpretations of the Davis-Bacon and Related Acts contained in 29 C.F.R. Parts 1, 3, and 5. The incorporation clause was included in the contract pursuant to the Secretary's regulations at 29 C.F.R. Sec. 5.5(a), which expressly require government agencies 11 to insert in full in any contract in excess of $2,000 ... for the actual construction ... of a ... public work ... which is subject to the labor standards provisions of any of the acts listed in Sec. 5.1, [including the Davis-Bacon Act] the following clauses ...: 12 . . . . . 13 (8) ... All rulings and interpretations of the Davis-Bacon and Related Acts contained in 29 CFR parts 1, 3, and 5 are herein incorporated by reference in this contract. 14 29 C.F.R. Sec. 5.5(a) (emphasis added). The consequences for a contractor who refuses to include this clause are also spelled out in the Secretary's regulations: the contractor will not receive payment for work performed under the contract. See id. Sec. 5.6(a)(1). 15 The Secretary contends that the effect of the mandatory incorporation clause is to bar Ball, as a matter of contract, from challenging the validity of Sec. 5.2(l )(2). This application of the incorporation clause forecloses all judicial review of the validity of the Secretary's regulations when those regulations are later applied to a particular contractor in an adjudicatory setting. Such an attempt to limit judicial review runs counter to the fundamental principles of reviewability underlying the Administrative Procedure Act. 16 The Administrative Procedure Act embodies the basic presumption of judicial review to one 'suffering legal wrong because of agency action, or adversely affected or aggrieved by agency action within the meaning of a relevant statute,' 5 U.S.C. Sec. 702, so long as no statute precludes such relief or the action is not one committed by law to agency discretion. Abbott Laboratories v. Gardner, 387 U.S. 136, 140, 87 S.Ct. 1507, 1511, 18 L.Ed.2d 681 (1967). Because of this well-settled presumption in favor of judicial review, McNary v. Haitian Refugee Center, Inc., 498 U.S. 479, 496, 111 S.Ct. 888, 898, 112 L.Ed.2d 1005 (1991), clear and convincing evidence of a legislative intention to preclude judicial review is required before we presume that Congress intended to foreclose judicial examination of the legality of administrative action. Reno v. Catholic Social Servs., Inc., --- U.S. ----, ----, 113 S.Ct. 2485, 2499, 125 L.Ed.2d 38 (1993). 17 An agency can neither adopt regulations contrary to statute, nor exercise powers not delegated to it by Congress. The Secretary, therefore, cannot adopt regulations erasing the presumption of reviewability embodied in the APA unless the Davis-Bacon Act reveals clear and convincing evidence that Congress intended to foreclose judicial review of the Secretary's regulations under the Act when those regulations are applied in later adjudicatory proceedings. Since we find nothing in the Act indicating such to be the case, we agree with appellants that the incorporation clause should not be read to preclude judicial review. Insofar as the incorporation clause purports to shield the Secretary's regulations from APA review in the courts, it is invalid and unenforceable. 18 The Secretary contends that the Ninth Circuit's opinion in Woodside Village v. United States Dep't. of Labor, 611 F.2d 312 (9th Cir.1980) (per curiam), counsels a different result. In Woodside, the court held that a contractor who agreed to pay Davis-Bacon wages was still required to honor that obligation during the period in which a Presidential Proclamation suspending the Act was in effect, since [n]othing in the Davis-Bacon Act precludes the parties from contracting with reference to it, even if by proper interpretation its requirements may not have been applicable by force of law to the project in question. Id. at 315. While we might agree with the Woodside court that nothing in the Davis-Bacon Act broadly precludes the parties from contracting with reference to it, at the same time, nothing in the Act specifically authorizes the Secretary to promulgate regulations requiring contractors to agree to waive judicial review normally available under the APA as a prerequisite to obtaining payment under their contracts with the government. Woodside is therefore inapposite. 19 In short, we conclude the district court erred in entering summary judgment against Ball on this ground.