Darby v. Cisneros

PETITIONER: Darby et al.
RESPONDENT: Cisneros, Secretary Of Housing And Urban Development, et al.
LOCATION: City of Minneapolis

DOCKET NO.: 91-2045
DECIDED BY: Rehnquist Court (1991-1993)
LOWER COURT: United States Court of Appeals for the Fourth Circuit

CITATION: 509 US 137 (1993)
ARGUED: Mar 22, 1993
DECIDED: Jun 21, 1993

ADVOCATES:
James A. Feldman - on behalf of the Respondents
Steven D. Gordon - on behalf of the Petitioners

Facts of the case

Question

Media for Darby v. Cisneros

Audio Transcription for Oral Argument - March 22, 1993 in Darby v. Cisneros

William H. Rehnquist:

We'll hear argument first this morning in No. 91-2045, R. Gordon Darby v. Henry Cisneros.

Mr. Gordon.

Steven D. Gordon:

Mr. Chief Justice, and may it please the Court:

In enacting the Administrative Procedure Act, Congress provided a general authorization for judicial review of administrative actions.

In section 10(c) of the act, it prescribed when and under what circumstances someone who is aggrieved by an agency action may seek recourse in Federal court.

Congress provided that a litigant need not exhaust available administrative remedies before proceeding to Federal court, unless such exhaustion is expressly required by statute or by agency rule.

The question presented in this case is whether, notwithstanding that Congress has spoken, a Federal court can impose additional exhaustion requirements and deprive a litigant of judicial review under the APA because he failed to pursue an administrative appeal that was not required by statute nor by the agency's own regulations.

The answer to this question, we submit, is no.

The facts of this case are straightforward.

In 1989, HUD initiated administrative sanctions against petitioners, Mr. Darby and his affiliates.

Mr. Darby contested those sanctions in full conformance with HUD's regulations.

He litigated the matter before the agency for some 10 months through a process which included discovery, a 4-day evidentiary hearing, and the submission of post-hearing briefs.

Ultimately, a HUD administrative law judge issued a lengthy written decision which upheld the sanctions.

Pursuant to HUD's regulations, the ALJ's decision became the final agency action unless the Secretary chose to review it.

In this case, neither party sought such secretarial review.

Mr. Darby then filed this suit in Federal district court.

He challenged the sanctions on the grounds that they violated the Administrative Procedure Act and the Due Process Clause.

The Government moved to dismiss for failure to exhaust administrative remedies.

The district court denied this motion and proceeded to grant relief to Mr. Darby, holding that the sanctions were not rationally supported by the facts and that they had been imposed for forbidden punitive reasons.

The Government appealed to the Fourth Circuit, challenging only the district court's ruling on exhaustion.

The Government contended that HUD's regulation providing for secretarial review of an ALJ's decision required Mr. Darby to seek secretarial review as a prerequisite to filing suit in Federal court.

The Fourth Circuit rejected that contention.

The circuit court recognized that no statute and no regulation required Mr. Darby to seek secretarial review.

Nonetheless, it decided that as a, quote, rule of judicial administration, Mr. Darby was required to exhaust this administrative remedy.

Since he had not done so, the court ruled that the district court should have dismissed his suit and left the administrative sanctions in effect.

Antonin Scalia:

Mr. Gordon, what if your client had, in fact, taken an appeal within the agency?

Your position then is, I take it, that still and all, you would be able to come to court and prosecute an appeal both in court and before the agency.

Steven D. Gordon:

Simultaneously, sir?

Yes.

Steven D. Gordon:

Justice Scalia, I believe that... that under the line of decisions, including particularly ICC v. Brotherhood of Locomotive Engineers, that at the point that the ALJ's decision became... was issued, that Mr. Darby had an option, and that he could have either pursued and administrative appeal or proceeded to Federal court.