Delegated Agencies: Can They Alter Existing Laws?

The delegation of power from the legislative branch to administrative agencies is a complex issue that has been the subject of much debate and scrutiny. While the separation of powers between the legislative, executive, and judicial branches is a foundational principle in the United States, the Supreme Court has acknowledged that the legislative branch can, in certain situations, delegate some of its power to administrative agencies. This recognition stems from the understanding that Congress cannot possibly account for every eventuality in law, especially in an ever-changing and increasingly complex society. However, the question of where to draw the line and the extent of power that can be delegated remains a subject of discussion, with scholars expressing concern over Congress's capacity to legislate and the potential for broad discretion in delegated agencies.

The Supreme Court's role in upholding or overruling delegated powers

The Supreme Court plays a pivotal role in interpreting and applying the law, including in cases involving delegated powers. Its decisions can uphold or overrule the actions of delegated agencies, setting important precedents. For instance, the Supreme Court's recent overruling of Chevron deference has significant implications for administrative agencies' interpretations of statutes.

The Supreme Court's decision to overturn Chevron deference underscores its willingness to re-evaluate and constrain delegated powers. Chevron deference refers to a legal principle established in a 1944 case, where the Court deferred to the Environmental Protection Agency's (EPA) interpretation of the Clean Air Act. The EPA's regulation broadly defined "stationary source" to encompass all pollution-emitting devices within an industrial plant, and the Court's deference to this interpretation set a precedent for judicial deference to administrative agencies.

However, in a recent case, the Supreme Court reversed this precedent, asserting its authority to interpret statutes independently. The Court ruled that Chevron deference was unconstitutional as it curbed the judicial power afforded to courts and granted excessive power to agencies within the executive branch. This ruling highlights the Court's role in checking the powers of delegated agencies and ensuring they act within their delegated authority.

The Supreme Court's decision to overrule Chevron deference is expected to have wide-ranging consequences. It invites more challenges to agency decisions and may lead to greater stability and predictability in the law. With Chevron deference removed, agencies will need to ensure their decisions are within the boundaries of their delegated authority and are based on reasoned decision-making.

In conclusion, the Supreme Court's role in upholding or overruling delegated powers is crucial in maintaining the balance of power between the judiciary and administrative agencies. The Court's decisions shape the legal framework within which delegated agencies operate, ensuring they act within their mandated scope and interpret statutes in a manner consistent with the law.

Separation of powers between the legislative, executive and judicial branches

The separation of powers is a principle that functionally differentiates several types of state power, usually law-making (legislative), adjudication (judicial), and execution (executive). This model of governance is divided into structurally independent branches, each performing distinct functions. A government is considered to have a high degree of separation when each function is strictly allocated to a single branch.

The first constitutional document to establish the separation of powers between the legislative, executive, and judiciary branches was the Pacts and Constitutions of Rights and Freedoms of the Zaporizhian Host, written in 1710 by Ukrainian Hetman Pylyp Orlyk. This document was a forerunner to Montesquieu's tripartite system, which was later articulated by John Locke in his work "Two Treatises of Government" (1690). Locke distinguished between legislative, executive, and federative power. He defined legislative power as having "the right to direct how the force of the commonwealth shall be employed," while executive power entailed "the execution of the laws that are made and remain in force."

The English Civil War also influenced the development of the separation of powers. During this period, the parliamentarians viewed the English system of government as composed of three branches: the King (executive), the House of Lords, and the House of Commons (both legislative). The Instrument of Government, written by English general John Lambert in 1653, proposed a tripartite system with a legislative branch (the Parliament) and two executive branches, the English Council of State and the Lord Protector, all elected and serving as checks on each other. This system was adopted as the constitution of England during The Protectorate.

The separation of powers is essential to maintaining liberty and preventing the concentration of power in a single person or body. According to Montesquieu, the judicial branch, which is generally seen as the most important of the three powers, must be truly independent and not merely apparent. Each branch of the state should have the ability to limit or check the other two, creating a balance between them.

The President's ability to delegate functions to agencies

The US Constitution's separation of powers between the legislative, executive, and judicial branches of the government is one of the founding principles of the nation. In general, the different branches cannot delegate their powers to each other. However, the Supreme Court has held that in some situations, the legislative branch can grant some of its power to administrative agencies.

The Supreme Court has declared that "the legislative power of Congress cannot be delegated," but Chief Justice Marshall recognized in 1825 that Congress may delegate powers that it "may rightfully exercise itself." The Court has also recognized that the administration of the law requires the exercise of discretion, and that Congress cannot do its job without the ability to delegate power under broad general directives.

However, since 1935, the Court has not struck down a delegation to an administrative agency. The Court has approved Congress's ability to delegate power under broad standards. For example, delegations to administrative agencies to determine "excessive profits" during wartime, or to determine "unfair and inequitable distribution of voting power" among securities holders.

The President can also delegate functions to the Secretary of Commerce, who can issue certificates of appointment or promotion in the name of the President. The President can also delegate functions to the Secretary of the Interior, who can convey or lease recreational demonstration projects and lands to the States or their political subdivisions.

The limits of delegated powers and where to draw the line

The separation of powers between the legislative, executive, and judicial branches of the US government is a foundational principle. Thus, the different branches cannot generally delegate their powers to each other. However, the Supreme Court has held that in some situations, the legislative branch can grant some of its power to administrative agencies.

The Supreme Court has sometimes declared that "the legislative power of Congress cannot be delegated". However, on other occasions, it has recognized that Congress may delegate powers that it "may rightfully exercise itself". This recognition stems from the understanding that administering the law requires the exercise of discretion, and that in a complex and ever-changing society, Congress cannot do its job without the ability to delegate power under broad general directives.

The real issue, as Chief Justice Marshall noted, is where to draw the line. There is some difficulty in discerning the exact limits of delegated powers. For example, in the case of United States v. Rock Royal Co-operative, Inc., the Court upheld a delegation of authority to implement policies that were directed by a narrower policy. In contrast, the Court has also struck down broad delegations, such as in Panama Refining Co. v. Ryan and Schechter Poultry v. U.S., where the delegations were deemed to be "without precedent" and "virtually unfettered".

The Court has also upheld complex economic regulations of industries, even when agencies initially denied having such power and acted without congressional guidance. Additionally, the Court has recognized that when administrations change, new officials may have the discretion to change or reverse agency policies. This raises concerns about the capacity of Congress to legislate effectively and the potential need for more precise standards in delegations of power.

The impact of overturning Chevron on judicial deference to agencies

The recent overturning of Chevron deference by the Supreme Court has had a significant impact on judicial deference to agencies. Chevron deference, established in Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. in 1984, previously required judges to defer to agencies' reasonable interpretations of "ambiguous" federal laws within their field of expertise. This deference was based on the recognition that agencies possess scientific and technical expertise that makes them better equipped to resolve ambiguities in statutes than courts.

However, the Supreme Court's decision in 2024 vacated this precedent and held that courts must now exercise their independent judgment in deciding whether an agency has acted within its statutory authority. This shift has important implications for the relationship between the judicial branch and administrative agencies.

One of the key impacts of overturning Chevron is the increased freedom for judges to interpret laws without deferring to agencies' views. This change may lead to more legal challenges and scrutiny of agency decisions, particularly in areas such as Medicare reimbursement, medical device approvals, and ACA protections. The absence of Chevron deference could result in delays and increased litigation, potentially overwhelming courts and agencies. It may also lead to inconsistent rulings, creating uncertainty for regulated entities and affecting sectors such as healthcare, the environment, financial regulations, and technology.

Another consequence of overturning Chevron is the potential shift in power dynamics between the judiciary and administrative agencies. Some argue that Chevron deference allowed unelected bureaucrats too much power in interpreting laws and that the Supreme Court's decision restores the proper balance by reinforcing the role of the judicial branch in interpreting the law. However, others disagree, claiming that agencies possess expertise that courts lack and that Chevron provided necessary deference to this expertise.

Despite the overturning of Chevron, it is worth noting that judicial deference to administrative agencies is a foundational principle of administrative law, and it may persist in a similar form. The allocation of law-making authority between courts and agencies has evolved over time, and the full impact of this decision remains to be seen.

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