Bar News - April 20, 2016
Rules Post-Mortem: In Which Rules Really Do Die
By: Aaron Mitchell
New Hampshire’s Legislature regularly amends RSA 541-A, the Administrative Procedure Act. Amongst the most significant changes to come through last year, HB 425 amended RSA 541-A:22 to state that expired rules are now unenforceable.
RSA 541-A has always provided that most rules expire. Most regular rules filed as proposed rules with the Office of Legislative Services prior to Sept. 11, 2011, expire eight years after their effective date, while those filed after that date expire after 10 years. You may wonder if HB 425 really changed anything; what does “expired” mean if it doesn’t mean that the rule becomes unenforceable upon expiration?
If this amendment simply made explicit what the Legislature always intended, what does this change, which may be no change at all, mean for the NH law practitioner?
To say that many sections of New Hampshire rules have expired understates the dilemma; some agencies have allowed every rule they’ve ever had to perish. These expired rules represent a potential liability, and this liability is doubly urgent now that RSA 541-A:22 leaves no room for doubt.
In my experience reviewing rules on behalf of the Joint Legislative Committee on Administrative Rules, I’ve seen that most agencies with expired rules continue to use them – they prioritize the missions set by federal law and New Hampshire statute over ceasing operations due to expired rules. To the agencies’ credit, most say quite honestly that they have continued to operate despite the unenforceability of their rules.
Given this potential liability, what may agencies do to avoid the problem? Aside from reentering regular rulemaking when rules are about to expire, one of the most effective strategies is to adopt “interim rules.” This process allows the agency to quickly readopt its rules for six months, allowing time for regular rulemaking.
The more complex question is whether an agency may continue to implement its policy despite expired rules. Although RSA 541-A:22 now suggests an easy “no,” the New Hampshire Supreme Court has issued a series of rulings that complicate the analysis.
Starting with Stuart v. State (1991) and Smith v. New Hampshire Bd. Of Exam. of Psychologists (1994), the NH Supreme Court has repeatedly found that agencies need not adopt rules to do what a statute specifically authorizes on its face.
In Stuart, the Court dealt with rules that had never been adopted and in Smith with rules that had expired. In each case, the Court reached a functionally identical conclusion: if the statute authorizes agency action, the lack of rules does not necessarily decide the case.
These cases allow agencies to act without rules in certain circumstances. Although this may be an accurate description of the legal holdings, in the world of government administration there is more to consider than court cases – agencies must consider how to effectively run themselves as well.
Take Smith for example. In that case a licensed psychologist engaged in obvious misconduct, including sex with his patients. Despite his brazen misconduct, Smith attempted to escape license revocation by appealing to the Supreme Court. One argument: the Board’s rules had expired.
The Court determined that the statute, which allowed the Board to punish “misconduct,” authorized punishment even without currently effective rules. If a non-expired rule sanctioned the conduct Smith engaged in, would he have pursued his case all the way to the Supreme Court? Perhaps, he had other arguments, but the presence of expired rules gave Smith a legal argument that could have prevailed.
Two questions arise: What if the misconduct was less clearly prohibited? How much extra effort was expended to reach that obvious finding?
If the misconduct was less clear, then the Court could have held that the statute was not “clear on its face,” at least not clear enough to afford constitutional due process. In future cases, agencies may prevail on the theory that they have only done what the statute “authorizes on its face,” but it shouldn’t take litigation to establish that.
By choosing to rely on statutes rather than rules, agencies risk the successful implementation of their policies in lawsuits interpreting their enabling statutes – an expensive, stressful, and inefficient proposition.
In granting rulemaking authority, the Legislature gave the agencies the first crack at interpreting statutes. To allow rules to expire abdicates that responsibility to the courts, potentially resulting in interpretations with which the agency disagrees. Rulemaking is the more effective method for establishing and enforcing consistent, generally applicable policies.
HB 425 solidifies a longstanding interpretation of RSA 541-A:22. In doing so, it incentivizes re-adoption of expired rules, and makes private practitioners aware of a potential legal argument.
For more information regarding the rulemaking process, please visit www.gencourt.state.nh.us.
Aaron Mitchell is committee attorney for the NH Joint Legislative Committee on Administrative Rules (JLCAR).
The views expressed in this article are those of the author, and do not reflect the views of the Office of Legislative Services, Administrative Rules Division.