GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1999

H	2 

HOUSE BILL 968
Committee Substitute Favorable 4/22/99

Short Title:  Amend Contested Case Proc.	(Public)

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Sponsors:

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Referred to:  

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April 12, 1999

A BILL TO BE ENTITLED
AN ACT TO MODIFY THE PROCEDURES CONCERNING FINAL ADMINISTRATIVE DECISIONS IN CONTESTED CASES HEARD BY THE OFFICE OF ADMINISTRATIVE HEARINGS.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 150B-2(5) reads as rewritten:
"(5)	"Party"means any person or agency named or admitted as a party or properly seeking as of right to be admitted as a party and includes the agency as appropriate. "
Section 2.   G.S. 150B-29(a) reads as rewritten:
"(a)	In all contested cases, irrelevant, immaterial and unduly repetitious evidence shall be excluded.  Except as otherwise provided, the rules of evidence as applied in the trial division of the General Court of Justice shall be followed; but, when evidence is not reasonably available under the rules to show relevant facts, then the most reliable and substantial evidence available shall be admitted. On the judge's own motion, an administrative law judge may exclude evidence that is inadmissible under this section.  The party with the burden of proof in a contested case must establish the facts required by G.S. 150B-23(a) by a preponderance of the evidence.  It shall not be necessary for a party or his attorney to object at the hearing to evidence in order to preserve the right to object to its consideration by the administrative law judge in making a recommended decision, by the agency in making a final decision, or by the court on judicial review."
Section 3.  G.S. 150B-34 reads as rewritten:
"§ 150B-34.  Final decision or order.
(a)	Except as provided in subsection (c) of this section, in each contested case the administrative law judge shall make a final decision or order that contains findings of fact and conclusions of law.
(b)	Repealed by Session Laws 1991, c. 35, s. 6.
(c)	Notwithstanding subsection (a) of this section, in cases arising under Article 9 of Chapter 131E of the General Statutes, the administrative law judge shall make a recommended decision or order that contains findings of fact and conclusions of law. A final decision shall be made by the agency after review of the official record as defined in G.S. 150B-37(a) and shall include findings of fact and conclusions of law.  The final agency decision shall recite and address all of the facts set forth in the recommended decision.  For each finding of fact in the recommended decision not adopted by the agency, the agency shall state the specific reason, based on the evidence, for not adopting the findings of fact and the agency's findings shall be supported by substantial evidence admissable under G.S. 150B-29(a), 150B-30, or 150B-31.
(d)	Except for the exemptions contained in G.S. 150B-1, and subsection (c) of this section, the provisions of this section shall apply to all agencies subject to Article 3 of this Chapter, notwithstanding any other provisions to the contrary relating to recommended decisions by administrative law judges and final agency decisions."
Section 4.  G.S. 150B-35 reads as rewritten:
"§ 150B-35. No ex parte communication; exceptions.
Unless required for disposition of an ex parte matter authorized by law, the administrative law judge assigned to a contested case may not communicate, directly or indirectly, in connection with any issue of fact, or question of law, with any person or party or his representative, except on notice and opportunity for all parties to participate."
Section 5.  G.S. 150B-36 is repealed.
Section 6.  G.S. 150B-37 reads as rewritten:
"§ 150B-37. Official record.
(a)	In a contested case, the Office of Administrative Hearings shall prepare an official record of the case that includes:
(1)	Notices, pleadings, motions, and intermediate rulings;
(2)	Questions and offers of proof, objections, and rulings thereon;
(3)	Evidence presented;
(4)	Matters officially noticed, except matters so obvious that a statement of them would serve no useful purpose; and
(5)	Repealed by Session Laws 1987, c. 878, s. 25.
(6)	The administrative law judge's final decision, or order.
(b)	Proceedings at which oral evidence is presented shall be recorded, but need not be transcribed unless requested by a party. Each party shall bear the cost of the transcript or part thereof or copy of said transcript or part thereof which said party requests, and said transcript or part thereof shall be added to the official record as an exhibit.
(c)	The Office of Administrative Hearings shall forward a copy of the decision to each party."
Section 7.  G.S. 150B-44 reads as rewritten:
"§ 150B-44.  Right to judicial intervention when decision unreasonably delayed.
Unreasonable delay on the part of any agency or administrative law judge in taking any required action shall be justification for any person whose rights, duties, or privileges are adversely affected by such delay to seek a court order compelling action by the agency or administrative law judge.   Failure of an administrative law judge subject to Article 3 of this Chapter or failure of an agency subject to Article 3A of this Chapter to make a final decision within 180 days of the close of the contested case hearing is justification for a person whose rights, duties, or privileges are adversely affected by the delay to seek a court order compelling action by the agency or by the administrative law judge."
Section 8.  G.S. 150B-43 reads as rewritten:
"§ 150B-43. Right to judicial review.
Any party who is aggrieved by the final decision in a contested case, and who has exhausted all administrative remedies made available to the party by statute or agency rule, is entitled to judicial review of the decision under this Article, unless adequate procedure for judicial review is provided by another statute, in which case the review shall be under such other statute. Nothing in this Chapter shall prevent any party from invoking any judicial remedy available to the party under the law to test the validity of any administrative action not made reviewable under this Article."
Section 9.  G.S. 150B-47 reads as rewritten:
"§ 150B-47. Records filed with clerk of superior court; contents of records; costs.
Within 30 days after receipt of the copy of the petition for review, or within such additional time as the court may allow, the Office of Administrative Hearings shall transmit to the reviewing court the original or a certified copy of the official record in the contested case under 	review. With the permission of the court, the record may be shortened by stipulation of all parties to the review proceedings. Any party unreasonably refusing to stipulate to limit the record may be taxed by the court for such additional costs as may be occasioned by the refusal. The court may require or permit subsequent corrections or additions to the record when deemed desirable."
Section 10.  G.S. 150B-49 reads as rewritten:
"§ 150B-49.  New evidence.
A party who files a petition in the superior court may apply to the court to present additional evidence.  If the court is satisfied that the evidence is material to the issues, is not merely cumulative, and could not reasonably have been presented at the administrative hearing, the court may remand the case so that additional evidence can be taken.  If an administrative law judge did not make a final decision in the case, the court shall remand the case to the agency that conducted the administrative hearing, under Article 3A of this Chapter and under G.S. 150B-34(c)	of this Chapter.   After hearing the evidence, the agency may affirm or modify its previous findings of fact and final decision.  If an administrative law judge made the final decision in the case, the court shall remand the case to the administrative law judge.  After hearing the evidence, the administrative law judge may affirm or modify his previous findings of fact and final decision.  The additional evidence and any affirmation or modification of a final decision shall be made part of the official record." 
Section 11.  G.S. 150B-50 reads as rewritten:
"§ 150B-50. Review by superior court without jury.
The review by a superior court of administrative decisions under this Chapter shall be conducted by the court without a jury."
Section 12.  G.S. 150B-51 reads as rewritten:
"§ 150B-51.  Scope of review.
		The court reviewing a final decision may affirm the decision or remand the case for further proceedings.  It may also reverse or modify the decision if the substantial rights of the petitioners may have been prejudiced because the findings, inferences, conclusions, or decisions are:
(1)	In violation of constitutional provisions;
(2)	In excess of the statutory authority or jurisdiction of the agency;
(3)	Made upon unlawful procedure;
(4)	Affected by other error of law;
(5)	Unsupported by substantial evidence admissible under G.S. 150B-29(a), 150B-30, or 150B-31 in view of the entire record as submitted; or
(6)	Arbitrary or capricious."
Section 13.  This act becomes effective January 1, 2000, and applies to contested cases commenced on or after the effective date.