Senator STEVEN V. OROHO
District 24 (Sussex, Hunterdon and Morris)
Senator DAWN MARIE ADDIEGO
District 8 (Burlington)
Modifies process for contested case hearings by OAL with regard to telephone and video conferences, delegation of final decision authority, oral decisions, checklist decisions, electronic filings, and settlements.
CURRENT VERSION OF TEXT
As reported by the Senate State Government, Wagering, Tourism & Historic Preservation Committee on March 10, 2011, with amendments.
An Act concerning contested case hearings by the Office of Administrative Law and amending P.L.1978, c.67, and amending and supplementing P.L.1968, c.410.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 9 of P.L.1968, c.410 (C.52:14B-9) is amended to read as follows:
9. (a) In a contested case, all parties shall be afforded an opportunity for hearing after reasonable notice.
(b) The notice shall include in addition to such other information as may be deemed appropriate:
(1) A statement of the time, place, and nature of the hearing;
(2) A statement of the legal authority and jurisdiction under which the hearing is to be held;
(3) A reference to the particular sections of the statutes and rules involved;
(4) A short and plain statement of the matters asserted. If the agency or other party is unable to state the matters in detail at the time the notice is served, the initial notice may be limited to a statement of the issues involved. Thereafter upon application a more definite and detailed statement shall be furnished.
(c) Opportunity shall be afforded all parties to respond, appear and present evidence and argument on all issues involved.
Pre-hearing conferences may be conducted, as prescribed by the director.
Witnesses may be permitted to testify, and motions may be considered, by means of a telephone or video conference call, as prescribed by the director 1and when the judge finds there is good cause for permitting the witness to testify by telephone or video conference1.
(d) Unless precluded by law, informal disposition may be made of any contested case by stipulation, agreed settlement, or consent order.
(e) Oral proceedings or any part thereof shall be transcribed on request of any party at the expense of such party.
(f) Findings of fact shall be based exclusively on the evidence and on matters officially noticed.
(g) Unless otherwise provided by any law, agencies may place on any party the responsibility of requesting a hearing if the agency notifies him in writing of his right to a hearing and of his responsibility to request the hearing.
(cf: P.L.1968, c.410, s.9)
2. Section 10 of P.L.1968, c.410 (C.52:14B-10) is amended to read as follows:
10. In contested cases:
(a) The parties shall not be bound by rules of evidence whether statutory, common law, or adopted formally by the Rules of Court. All relevant evidence is admissible, except as otherwise provided herein. The administrative law judge may in his discretion exclude any evidence if he finds that its probative value is substantially outweighed by the risk that its admission will either (i) necessitate undue consumption of time or (ii) create substantial danger of undue prejudice or confusion. The administrative law judge shall give effect to the rules of privilege recognized by law. Any party in a contested case may present his case or defense by oral and documentary evidence, submit rebuttal evidence and conduct such cross-examination as may be required, in the discretion of the administrative law judge, for a full and true disclosure of the facts.
(b) Notice may be taken of judicially noticeable facts. In addition, notice may be taken of generally recognized technical or scientific facts within the specialized knowledge of the agency or administrative law judge. Parties shall be notified either before or during the hearing, or by reference in preliminary reports or otherwise, of the material noticed, including any staff memoranda or data, and they shall be afforded an opportunity to contest the material so noticed. The experience, technical competence, and specialized knowledge of the agency or administrative law judge may be utilized in the evaluation of the evidence, provided this is disclosed of record.
(c) All hearings of a State agency required to be conducted as a contested case under this act or any other law shall be conducted by an administrative law judge assigned by the Director and Chief Administrative Law Judge of the Office of Administrative Law, except as provided by this amendatory and supplementary act. A recommended report and decision which contains recommended findings of fact and conclusions of law and which shall be based upon sufficient, competent, and credible evidence shall be filed, not later than 45 days after the hearing is concluded, with the agency in such form that it may be adopted as the decision in the case and delivered or mailed, to the parties of record with an indication of the date of receipt by the agency head; and an opportunity shall be afforded each party of record to file exceptions, objections, and replies thereto, and to present argument to the head of the agency or a majority thereof, either orally or in writing, as the agency may direct.
Unless the head of the agency 1or a party1 requests that the recommended report and decision be filed in writing, the recommended report and decision of the administrative law judge may be filed orally in such appropriate cases as prescribed by the director and if a transcript has been requested pursuant to subsection (e) of section 9 of P.L.1968, c.410 (C.52:14B-9).
An administrative law judge may file a recommended report and decision in the form of a checklist in such appropriate cases and formats as prescribed by the director after consultation with each State agency.
The head of the agency, upon a review of the record submitted by the administrative law judge, shall adopt, reject or modify the recommended report and decision no later than 45 days after receipt of such recommendations. In reviewing the decision of an administrative law judge, the agency head may reject or modify findings of fact, conclusions of law or interpretations of agency policy in the decision, but shall state clearly the reasons for doing so. The agency head may not reject or modify any findings of fact as to issues of credibility of lay witness testimony unless it is first determined from a review of the record that the findings are arbitrary, capricious or unreasonable or are not supported by sufficient, competent, and credible evidence in the record. In rejecting or modifying any findings of fact, the agency head shall state with particularity the reasons for rejecting the findings and shall make new or modified findings supported by sufficient, competent, and credible evidence in the record. Unless the head of the agency modifies or rejects the report within such period, the decision of the administrative law judge shall be deemed adopted as the final decision of the head of the agency. The recommended report and decision shall be a part of the record in the case. For good cause shown, upon certification by the director and the agency head, the time limits established herein may be subject to extension.
(d) A final decision or order adverse to a party in a contested case shall be in writing or stated in the record. A final decision shall include findings of fact and conclusions of law, separately stated and shall be based only upon the evidence of record at the hearing, as such evidence may be established by rules of evidence and procedure promulgated by the director.
Findings of fact, if set forth in statutory language, shall be accompanied by a concise and explicit statement of the underlying facts supporting the findings. The final decision may incorporate by reference any or all of the recommendations of the administrative law judge. Parties shall be notified either personally or by mail of any decision or order. Upon request a copy of the decision or order shall be delivered or mailed forthwith by registered or certified mail to each party and to his attorney of record.
(e) Except where otherwise provided by law, the administrative adjudication of the agency shall be effective on the date of delivery or on the date of mailing, of the final decision to the parties of record whichever shall occur first, or shall be effective on any date after the date of delivery or mailing, as the agency may provide by general rule or by order in the case. The date of delivery or mailing shall be stamped on the face of the decision.
(f) The head of an agency may order that, in certain appropriate cases, the recommended report and decision of the administrative law judge shall be deemed adopted, immediately on filing thereof with the agency, as the final decision of the agency head. The appropriate cases shall be described in a written order issued by the agency head, filed with the director, and made available to the public as a government record. The order shall not include (1) any contested case for which the agency head is specifically required by State or federal law to review the recommended report and decision and adopt the final decision, or (2) any contested cases specified in subsection (g) of this section. The head of the agency may revise or revoke an order, issued pursuant to this subsection, whenever it is deemed appropriate. The order shall apply to all appropriate contested cases commenced with the agency after the order’s issuance and until the order is rescinded or modified. In such appropriate contested cases, the head of the agency shall not have the opportunity to reject or modify the administrative law judge’s recommended report and decision pursuant to subsection (c) of this section and the final decision by the administrative law judge shall comply with the requirements of and shall be given the same effect as a final decision of the head of the agency pursuant to subsection (d) of this section.
(g) With regard to contested cases commenced with an agency on or after the effective date of P.L. , c. (pending before the Legislature as this bill) that are described in this subsection, the report and decision of the administrative law judge shall be the final decision upon the filing thereof with the agency, notwithstanding any other provision of State law to the contrary. In such contested cases, the head of the agency shall not have the opportunity to reject or modify the administrative law judge’s report and decision pursuant to subsection (c) of this section and the final decision by the administrative law judge shall comply with the requirements of and shall be given the same effect as a final decision of the head of the agency pursuant to subsection (d) of this section. Any reference in statutes, orders, documents, or other records to a final decision by the head of an agency shall mean the decision rendered by the administrative law judge as provided in this subsection. This subsection shall apply to any contested case from:
(1) the Department of Community Affairs;
(2) the Department of Education;
(3) the Department of Environmental Protection;
(4) the Department of Children and Families involving placement on a child abuse registry;
(5) the Department of Health and Senior Services involving placement on the nurse aid registry, and penalty matters;
(6) the Division of Family Development in the Department of Human Services;
(7) the Division of Civil Rights in the Department of Law and Public Safety;
(8) the New Jersey Motor Vehicle Commission;
(9) the Civil Service Commission; and
(10) the Department of Law and Public Safety under P.L.1988, c.123 (C.56:12-29 et seq.).
(cf: P.L.2001, c.5, s.4)
3. Section 5 of P.L.1978, c.67 (C.52:14F-5) is amended to read as follows:
5. The Director and Chief Administrative Law Judge of the Office of Administrative Law shall:
a. Administer and cause the work of the office to be performed in such manner and pursuant to such program as may be required or appropriate;
b. Organize and reorganize the office, and establish such bureaus as may be required or appropriate;
c. Except as otherwise provided in subsections l. and t., below, appoint, pursuant to the provisions of Title 11A of the New Jersey Statutes, such clerical assistants and other personnel as may be required for the conduct of the office;
d. Assign and reassign personnel to employment within the office;
e. Develop uniform standards, rules of evidence, and procedures, including but not limited to standards for determining whether a summary or plenary hearing should be held to regulate the conduct of contested cases and the rendering of administrative adjudications;
f. Promulgate and enforce such rules for the prompt implementation and coordinated administration of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) as may be required or appropriate;
g. Administer and supervise the procedures relating to the conduct of contested cases and the making of administrative adjudications, as defined by section 2 of P.L.1968, c.410 (C.52:14B-2) , 1[and]1 develop and implement an electronic filing system for the conduct of contested cases in such a manner and within such a time period as deemed practicable within available resources 1, and at the discretion of the director and the chief administrative law judge, charge a filing fee for the development and implementation of the electronic filing system in appropriate cases1;
h. Advise agencies concerning their obligations under the Administrative Procedure Act, subject to the provisions of subsections b. and e. of section 4 of P.L.1944, c.20 (C.52:17A-4);
[I.] i. Assist agencies in the preparation, consideration, publication and interpretation of administrative rules required or appropriate pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.);
j. Employ the services of the several agencies and of the employees thereof in such manner and to such extent as may be agreed upon by the director and the chief executive officer of such agency;
k. Have access to information concerning the several agencies to assure that they properly promulgate all rules required by law;
l. Assign permanent administrative law judges at supervisory and other levels who are qualified in the field of administrative law or in subject matter relating to the hearing functions of a State agency.
Administrative law judges shall receive such salaries as provided by section 4 of P.L.1978, c.67 (C.52:14F-4), as amended by P.L.1999, c.380, shall not engage in the practice of law and shall devote full time to their judicial duties.
Administrative law judges appointed after the effective date of this amendatory act shall have been attorneys-at-law of this State for a minimum of five years. An administrative law judge appointed prior to the effective date of this amendatory act shall not be required to be an attorney or, if an attorney, shall not be required to have been an attorney-at-law for five years in order to be reappointed;
m. Appoint additional administrative law judges, qualified in the field of administrative law or in a subject matter relating to the hearing functions of a State agency, on a temporary or case basis as may be necessary during emergency or unusual situations for the proper performance of the duties of the office, pursuant to a reasonable fee schedule established in advance by the director. Administrative law judges appointed pursuant to this procedure shall have the same qualifications for appointment as permanent administrative law judges;
n. Assign administrative law judges to conduct contested cases as required by sections 9 and 10 of P.L.1968, c.410 (C.52:14B-9 and 52:14B-10). Proceedings shall be scheduled for suitable locations, either at the offices of the Office of Administrative Law or elsewhere in the State, taking into consideration the convenience of the witnesses and parties, as well as the nature of the cases and proceedings;
o. Assign an administrative law judge or other personnel, if so requested by the head of an agency and if the director deems appropriate, to any agency to conduct or assist in administrative duties and proceedings other than those related to contested cases or administrative adjudications, including but not limited to rule-making and investigative hearings;
p. Assign an administrative law judge not engaged in the conduct of contested cases to perform other duties vested in or required of the office;
q. Secure, compile and maintain all reports of administrative law judges issued pursuant to this act, and such reference materials and supporting information as may be appropriate;
r. Develop and maintain a program for the continuing training and education of administrative law judges and agencies in regard to their responsibilities under this act;
s. Develop and implement a program of judicial evaluation to aid himself in the performance of his duties, and to assist in the making of reappointments under section 4 of P.L.1978, c.67 (C.52:14F-4). This program of evaluation shall focus on three areas of judicial performance: competence, productivity, and demeanor. It shall include consideration of: industry and promptness in adhering to schedules, making rulings and rendering decisions; tolerance, courtesy, patience, attentiveness, and self-control in dealing with litigants, witnesses and counsel, and in presiding over contested cases; legal skills and knowledge of the law and new legal developments; analytical talents and writing abilities; settlement skills; quantity, nature and quality of caseload disposition; impartiality and conscientiousness. The director shall develop standards and procedures for this program, which shall include taking comments from selected litigants and lawyers who have appeared before a judge. The methods used by the judge but not the result arrived at by the judge in any case may be used in evaluating a judge. Before implementing any action based on the findings of the evaluation program, the director shall discuss the findings and the proposed action with the affected judge. The evaluation by the director and supporting data shall be submitted to the Governor at least 90 days before the expiration of any term. These documents shall remain confidential and shall be exempted from the requirements of P.L.1963, c.73 (C.47:1A-1 et seq.);
t. Promulgate and enforce rules for reasonable sanctions, including assessments of costs and attorneys' fees which may be imposed on a party, and attorney or other representative of a party who, without just excuse, fails to comply with any procedural order or with any standard or rule applying to a contested case and including the imposition of a fine not to exceed $1,000.00 for misconduct which obstructs or tends to obstruct the conduct of contested cases;
u. Have power in connection with contested case hearings (1) to administer oaths to any and all persons, (2) to compel by subpoena the attendance of witnesses and the production of books, records, accounts, papers, and documents of any person or persons, (3) to entertain objections to subpoenas, and (4) to rule upon objections to subpoenas except, that any orders of administrative law judges regarding these objections may be reviewed by the agency head before the completion of the contested case in accordance with procedural rules, adopted by the Director and Chief Administrative Law Judge of the Office of Administrative Law. Misconduct by any party, attorney or representative of a party or witness which obstructs or tends to obstruct the conduct of a contested case or the failure of any witness, when duly subpoenaed to attend, give testimony or produce any record, or the failure to pay any sanction assessed pursuant to subsection t. of this section, shall be punishable by the Superior Court in the same manner as such failure is punishable by such court in a case pending therein; [and]
v. Assign any judge recalled pursuant to section 4 of P.L.1978, c.67 (C.52:14F-4) and fix the per diem allowance ;
w. Assign an administrative law judge or other personnel to conduct arbitration, mediation, and other forms of alternative dispute resolution with regard to any contested case or any proceeding other than that related to a contested case or administrative adjudication; and
x. Schedule hearings in an expeditious and efficient manner taking into account the significance of the issues, the needs of the parties, available resources, costs to the parties, and other relevant factors. The director may, on a temporary basis when required by exigent circumstances, schedule hearings notwithstanding deadlines otherwise set forth in statute.
(cf: P.L.2005, c.6, s.2)
4. (New section) Each State agency shall develop and implement a process for the consideration and settlement of a contested case. The process shall be set forth in writing and filed with the Director of the Office of Administrative Law. The director shall assist each State agency in the development of the process to ensure uniformity to the extent practicable. The head of an agency is hereby authorized to compromise and settle, at the discretion of the agency head, any penalty pursuant to such a settlement process as may appear appropriate and equitable under all of the circumstances, unless the compromise is specifically prohibited by State or federal law.
5. This act shall take effect on the 60th day following enactment.