Opinion ID: 483233
Heading Depth: 1
Heading Rank: 4

Heading: judicial review of the scope and exercise of agency discretion

Text: 48 Although this court has reviewed the Secretary's failure to promulgate a field sanitation standard on three prior occasions, we feel compelled to address anew the principles of judicial review that apply to a decision by the Secretary to withhold or delay promulgation of a standard. On more than one of these occasions, we have stated that, under the OSH Act, the Secretary has a certain amount of discretion in determining whether, when, and how to set standards to serve the purposes of [the Act], 29 U.S.C. Sec. 655(b)(1). See El Congreso I & II. Nevertheless, we have also suggested that this discretion is not unlimited and that the agency's failure to promulgate a field sanitation standard is not immune from judicial scrutiny. See El Congreso II; Order of March 29, 1985. Principles of judicial review governing agency discretion not to take action remain a source of continuing controversy, however, and recent developments in the law require that we revisit the issue. 49 In Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971), the Supreme Court established that, unless another statute precludes judicial review, the Administrative Procedure Act (APA), 5 U.S.C. Sec. 701 et seq., provides that agency decisionmaking may be judicially reviewed for compliance with two basic criteria. 5 First, an agency cannot exercise its discretion in a manner contrary to law. The scope of an agency's discretion is bounded by law; an agency cannot justify a decision by reference to its discretionary authority, if the decision lies beyond the scope of the agency's discretion. Therefore, [t]he court is first required to decide whether the Secretary acted within the scope of his authority. Overton Park, 401 U.S. at 415, 91 S.Ct. at 823. A statute may define as off-limits to an agency a particular basis for a decision, just as it may foreclose a particular result altogether. For example, the OSH Act directs the Secretary of Labor to regulate toxic materials to the extent feasible, 29 U.S.C. Sec. 655(b)(5), and the Supreme Court has held that this language precludes the Secretary from using cost-benefit analysis in deciding how to exercise his standard-setting authority under the statute: [a]ny standard based on a balancing of costs and benefits by the Secretary that strikes a different balance than that struck by Congress would be inconsistent with the command set forth in [Sec. 655(b)(5) ]. American Textile Manufacturers Institute v. Donovan, 452 U.S. 490, 509, 101 S.Ct. 2478, 2490, 69 L.Ed.2d 185 (1981). Thus, if an agency rests a decision on statutorily impermissible considerations, a reviewing court must set aside the decision as beyond the scope of the agency's discretion. 6 50 Second, an agency may not abuse its discretion. Even within the scope of authority established by statute, an agency's decision may nonetheless be arbitrary or capricious. 5 U.S.C. Sec. 706(2)(A); see Overton Park, 401 U.S. at 416, 91 S.Ct. at 823. For example, an agency's decision may be based upon the precise factors that Congress intended, but its balancing of those factors may be so unreasonable as to constitute an abuse of discretion. Id. The Supreme Court has stressed, however, that judicial review for arbitrariness, in contrast to lawlessness, is narrow and deferential to agency judgment. The reviewing court may not substitute its judgment for that of the agency. Motor Vehicle Manufacturers Association v. State Farm Mutual Automobile Insurance Co., 463 U.S. 29, 43, 103 S.Ct. 2856, 2866, 77 L.Ed.2d 443 (1983); Overton Park, 401 U.S. at 416, 91 S.Ct. at 823. Nevertheless, an agency's decision may on occasion transcend reasonableness and become a clear error of judgment. State Farm, 463 U.S. at 43, 103 S.Ct. at 2867; Overton Park, 401 U.S. at 416, 91 S.Ct. at 824. It was this second, abuse of discretion standard found in Overton Park that this court applied in El Congreso II. See 626 F.2d at 88-89. 51 After Heckler v. Chaney, 470 U.S. 821, 105 S.Ct. 1649, 84 L.Ed.2d 714 (1985), however, there has been some uncertainty about how these principles apply in cases involving agency inaction. 7 In Chaney, the Supreme Court precluded judicial review of a decision by the Food and Drug Administration not to institute an enforcement proceeding against parties allegedly violating the Federal Food, Drug, and Cosmetic Act. More generally, the Supreme Court stated that an agency's decision not to take enforcement action should be presumed immune from judicial review ... [although] the presumption may be rebutted where the substantive statute has provided guidelines for the agency to follow in exercising its enforcement powers. Id. at 832-33, 105 S.Ct. at 1656 (footnote omitted). 52 The Chaney holding derives from an ongoing effort to reconcile the APA's directive that a reviewing court shall ... set aside agency action ... found to be ... an abuse of discretion, 5 U.S.C. Sec. 706(2)(A), with a counterpart APA provision that judicial review under Sec. 706 does not apply to the extent that ... agency action is committed to agency discretion by law. 5 U.S.C. Sec. 701(a)(2). The Supreme Court observed in Chaney that in some circumstances agency decisionmaking may legitimately rely on factors whose evaluation depends so much on the agency's own expertise that it is not feasible for a court to review the decision even for clear error, without improperly substituting its own judgment for the agency's. In the Court's words, if no judicially manageable standards are available for judging how and when an agency should exercise its discretion then it is impossible to evaluate agency action for 'abuse of discretion.'  470 U.S. at 830, 105 S.Ct. at 1655. 53 The Court reasoned that in circumstances where a court has no competence to determine if an agency has abused its discretion, judicial review is precluded under the terms of Sec. 701(a)(2). Thus, the presumption that agency nonenforcement is unreviewable stems from the fact that an agency decision not to enforce often involves a complicated balancing of a number of factors which are peculiarly within its expertise. 470 U.S. at 831, 105 S.Ct. at 1656. The Court identified such factors: whether agency resources are best spent on this violation or another, ... whether the particular enforcement action is likely to suceed if it acts, and indeed, whether the agency has enough resources to undertake the action at all. Id. 54 Apart from such inherently unreviewable factors, the Chaney opinion acknowledges that most agency decisions rest on grounds that are susceptible to judicial review for abuse of discretion. In these cases, the proper construction of Secs. 701(a)(2) and 706(2)(A) requires a court to determine whether the agency's decision was arbitrary or capricious. Furthermore, the Supreme Court's citation in Chaney to its earlier decision in Dunlop v. Bachowski, 421 U.S. 560, 95 S.Ct. 1851, 44 L.Ed.2d 377 (1975), makes clear that this principle of reviewability applies to agency inaction as well as agency action. 55 In Dunlop, the Supreme Court held that a decision by the Secretary of Labor not to bring suit to set aside a union election in violation of the Labor-Management Reporting and Disclosure Act was subject to judicial review for abuse of discretion. Although cautioning that since the statute relies on the special knowledge and discretion of the Secretary for the determination of the probable violation and the probable effect, clearly the reviewing court is not authorized to substitute its judgment for the decision of the Secretary not to bring suit, id. at 571, 95 S.Ct. at 1860, the Court went on to say that the [reviewing] court may, however, ultimately come to the conclusion that the Secretary's statement of reasons on its face renders necessary the conclusion that his decision not to sue is so irrational as to constitute the decision arbitrary and capricious. Id. at 575, 95 S.Ct. at 1861. In explaining Dunlop, the Chaney opinion noted that clearly defined factors were present in the statute to guide judicial review in that case. 470 U.S. at 834, 105 S.Ct. at 1657 (internal quotation omitted). Therefore, the Chaney Court stated, the Secretary's decision in Dunlop was not beyond the judicial capacity to supervise. Id. (internal quotations omitted). Thus, Heckler assumes continued judicial review of agency inaction for abuse of discretion where the decision is based on factors that the court is competent to evaluate. 56 More important, the holding in Chaney in no way precludes judicial review of agency decisions that are contrary to law. Indeed, it is not possible to interpret Sec. 701(a)(2) to reach that result. That provision, to repeat, precludes judicial review only to the extent that ... agency action is committed to agency discretion by law. 5 U.S.C. Sec. 701(a)(2) (emphasis added). As we have discussed, agency discretion is defined by and circumscribed by law. Whatever the extent of a particular agency's discretion under a particular statute, it does not encompass the authority to contravene statutory commands. Thus, even when it is impossible [for a court] to evaluate agency action for abuse of discretion (as to those factors on which the agency has relied that are peculiarly within its competence), Chaney, 470 U.S. at 830, 105 S.Ct. at 1655, the court can--and must--review the agency's decision to determine that the agency has acted within the scope of [its] authority, Overton Park, 401 U.S. at 415, 91 S.Ct. at 823, and did not rely on factors that the Congress has not intended it to consider. State Farm, 463 U.S. at 43, 103 S.Ct. at 2867. In fact, this court has already held that Heckler v. Chaney does not bar judicial review of agency decisionmaking to determine whether the agency relied on statutorily impermissible or irrelevant factors. Robbins v. Reagan, 780 F.2d 37, 48 (D.C.Cir.1985) (per curiam). 8 57 This principle applies to agency inaction as well as agency action. If, for example, the Secretary decided not to promulgate a standard relating to a particular toxic material because of his reliance on cost-benefit analysis, this decision would be inconsistent with the command [of the OSH Act] and must be set aside. American Textiles, 452 U.S. at 509, 101 S.Ct. at 2490; see also State of Iowa ex. rel. Miller v. Block, 771 F.2d 347, 352 (8th Cir.1985) (holding that Chaney does not bar judicial review of the Secretary of Agriculture's failure to promulgate rules for implementing disaster relief programs when it is the clear duty of the Secretary to promulgate regulations which carry out the intent of Congress), cert. denied sub nom., Iowa ex rel. Miller v. Lyng, --- U.S. ----, 106 S.Ct. 3312, 3313, 92 L.Ed.2d 725 (1986). Moreover, Chaney itself states that, even in the context of nonenforcement, [i]f [Congress] has indicated an intent to circumscribe agency enforcement discretion ... courts may require that the agency follow the law. 470 U.S. at 834, 105 S.Ct. at 1657. 9 58 Thus, even after Chaney, the two basic principles of judicial review set forth in Overton Park still apply. If the grounds upon which the Secretary relied in his October 21, 1985 decision were impermissible under the OSH Act, then we must set aside the decision as beyond the scope of his authority and contrary to law. As long as the Secretary relied on permissible considerations, however, we are precluded from conducting any further judicial review if the evaluation of these factors depends so much on the agency's own expert judgment that it is impossible for this court to review the Secretary's decision even for clear error. But if the OSH Act has provided judicially manageable standards for determining whether the Secretary has abused his discretion, we must conduct that review. 10