WHEN IS THE PENALTY BEFORE AN
ADMINISTRATIVE AGENCY TOO MUCH?
By: Scott
J. Richardson
Arizona has dozens of administrative agencies, departments and
boards that regulate various professions and occupations ranging
from contractors to pest control companies; from doctors to real
estate agents; and many other professions. Licensure is often part
of the role the agency or board. They also have authority to
suspend, revoke or impose penalties against licensees.
What happens if a licensee is the subject of a complaint before
the agency or board and the result is an excessive penalty?
Excessive penalties are not just revocation of a license, but may
also include a particularly harsh civil penalty. What recourse does
the licensee have?
Most agencies and boards have laws or rules that provide for
rehearing after a penalty is issued, if it is excessive.
Under the Arizona Administrative Procedures Act, generally a
party can file a motion for rehearing or review as long as it is
filed within 30 days of the final administrative hearing. The
process, notifications and deadlines are defined at A.R.S. ยง
41-1092.09. It is important to note that all motions for
rehearing or review must be written and submitted to the agency
that first heard the matter. In addition to excessive
penalties there is a possibility that the assessed penalties could
be a result of dislike, bias or prejudice.
What is deemed excessive and how is
it defined?
Unfortunately, it is not based solely on what the licensee
thinks. Two different Arizona cases provide us with
guidance. "An administrative penalty is excessive only if it
is so [sic] disproportionate to the offense as to shock
one's sense of fairness." Schillerstrom v. State, 180
Ariz. 468, 885 P.2d 156, 159 (App. 1994) (citing Bear v. Nichols,
142 Ariz. 560, 563, 691 P.2d 326, 329 (App. 1984)). And
in a second case, the court opined, "We will not disturb the
penalty imposed by an administrative body unless there has been a
clear abuse of discretion". Taylor v.
Ariz. Law Enforcement Merit System Council, 152 Ariz. 200, 207, 731
P.2d 95, 102 (App. 1986).
What actions can be taken to redress
excessive penalties?
First, your lawyer should research similar cases heard by the
agency or board to determine a range of penalties that were
assessed in those matters and compare that to the penalties that
were assessed against you. Your attorney will need to determine how
the other cases were similar to or different from your case.
Using these prior decisions and assessments by the board or agency
is a persuasive weapon in our experience for redress.
A second approach is to review the suggested or proposed
penalties that were offered to you before the matter had a hearing
in front of the board. Was there an offer of a penalty much less
severe than what was ultimately ordered? What, if anything, changed
in the interim? If a relatively minor penalty was proposed
and rejected before the hearing and a shockingly more severe
penalty was ordered with no significant change in circumstances or
evidence, what was the cause? Was it because the licensee's
refusal to settle prior to the hearing or were there other
contributing factors?
Bias and prejudice on behalf of the board or agency can be a
determining factor. In prior dealings between the licensee
and the agency or board, was there "bad blood"? Were the same
people involved in the new matter? Have dealings been particularly
contentious? Evidence that there was a difficult prior
relationship between the licensee and the agency or board does not
necessarily meet the standard of excessive penalty. Remember, to be
excessive the penalty must be so disproportionate as to shock one's
sense of fairness.
If your case does not meet the three tests that we have outlined
above - bias and prejudice, significantly higher penalties than
originally offered or being punished disproportionately to others -
you can still argue excessiveness. This will require independent
proof of abuse of discretion and case law that supports your
position.
Decisions by boards and agencies are not always fair. You have
rights to redress that unfairness as long as you are within the
strict time limits of the law coupled with abidance of the rules of
the governing agency.
About the author: Scott
J. Richardson is a shareholder in the Phoenix law firm of Jaburg Wilk. Scott assists
clients with administrative
law, pest
control law and insurance
coverage issues. He frequently speaks and writes on
administrative law topics and is the author of Office of Pest
Management Qualifying Party and Supervisor Manual.
This article is not intended to provide legal advice and
only relates to Arizona law. It does not consider the scope
of laws in states other than Arizona. Always consult an
attorney for legal advice for your particular situation.
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