DEADLINES DRAW LINE FOR DUE PROCESS IN ADMINISTRATIVE PROCEEDINGS

May 13, 2004

Steven P. Garmisa
Hoey & Farina Attorney
garmisa@hoeyfarina.com
1-888-425-1212

The government sometimes gets to deprive people of a substantial liberty or property interest based on purported facts that have not been established by a preponderance of the evidence. But this skates close to the edge of what is prohibited by the due process clause.

In a new Illinois Supreme Court case, the justices were confronted with a regulatory program that:

• Authorized an initial administrative decision that was not supported by a preponderance of the evidence.
• Granted the right to an administrative appeal where the bureaucrats had to support their decision under the tougher more-likely-than-not test.
• Imposed specific deadlines for the hearing and final ruling on the internal appeal.

The question for the Supreme Court was, What if the bureaucrats blow the deadline for the administrative appeal?

This, the Supreme Court concluded, adds up to a due process violation requiring expunction of the initial administrative decision.

The Supreme Court ruled that when the government deprives an individual of a significant liberty or property interest using a standard of proof that is weaker than the classic preponderance of evidence, there is a denial of due process if the government fails to meet statutory or regulatory deadlines for finishing an administrative appeal of the initial decision under the tougher more-likely-than-not test. Lyon v. Department of Children and Family Services, No. 95643 (March 18).

To protect children from abuse, the Illinois Department of Children of Family Services uses a "credible evidence" standard in deciding whether child abuse is "indicated" and whether an adult should be listed in a central register pursuant to the Abused and Neglected Child Reporting Act.

When applying this standard, the department could accept as true evidence of alleged abuse and ignore contrary evidence. But if there is an administrative appeal of the initial decision that abuse is indicated, the department has to satisfy the tougher preponderance of the evidence standard. And there are deadlines for when the department has to hold a hearing and issue a final ruling on the administrative appeal.

A school teacher, Mark Lyon, filed an administrative appeal of an initial decision by the DCFS that child abuse by Lyon was indicated.
Lyon lost his job after the initial decision. And his administrative appeal was denied. But the department blew the deadline for issuing its final ruling.

The Illinois Supreme Court concluded that Lyon's right to due process was violated. Here are some highlights of Justice Rita B. Garman's opinion (with various omissions not noted in the quoted text):

"The due process clause protects fundamental justice and fairness. However, what due process entails is a flexible concept in that not all situations calling for procedural safeguards call for the same kind of procedure. Consequently, what procedures are required by due process in a particular situation depend upon the precise nature of the government function involved as well as the private interest that has been affected by governmental action.

"Due process principles apply to administrative proceedings.

"Procedural due process claims question the constitutionality of the procedures used to deny a person's life, liberty or property.

"We have explained: 'It is a well-established constitutional principle that every citizen has the right to pursue a trade, occupation, business or profession. This inalienable right constitutes both a property and liberty interest entitled to the protection of the law as guaranteed by the due process clauses of the Illinois and federal constitutions.'

"Generally, the state must act reasonably before depriving a person of an interest protected by the due process clause.

"We must first determine whether listing an indicated report about Lyon on the department's central register affected an interest protected by due process.

"Damage to one's reputation alone is insufficient to claim deprivation of a due process liberty interest, but stigma plus the loss of present or future employment is sufficient."

Garman explained that, "[B]ecause of the substantial risk that a teacher will be barred from pursuing his or her chosen occupation, as occurred in the present case, we find that an indicated report in the central register implicates a protected due process interest.

"Next, we must determine whether the procedures provided to Lyon met the requirements of due process. The U.S. Supreme Court has made clear that due process is a matter of federal constitutional law, so compliance or non- compliance with state procedural requirements is not determinative of whether minimum procedural due process standards have been met.

"Violation of state requirements may not indicate a due process violation, and vice versa, but these requirements are a useful reference because they represent standards that the General Assembly and the department concluded were sufficient."
And, "Due process concerns may be raised by the length of time the subject waits for the issuance of the final agency decision concerning his appeal.

"The due process clause requires that the opportunity to be heard occur at a meaningful time and in a meaningful manner.

"The U.S. Supreme Court has explained the factors courts should consider when evaluating procedural due process claims: 'First, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the government's interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail.' Mathews v. Eldridge, 424 U.S. 319, 335 (1976).

"The Supreme Court has adapted the general Mathews factors for the more specific determination of whether a delay in the provision of procedure offended due process: the importance of the private interest and the harm to the interest because of the delay; the government's justification for the delay and its connection to the underlying government interest; and the likelihood that the interim decision may have been mistaken.

"We recognize that Lyon has a significant interest in not having an indicated report about him entered into the central register because, as discussed above, an indicated report essentially bars employment in his chosen profession of teaching.

"As permitted by the act, an indicated report was entered into the central register before Lyon appealed the indicated finding. Lyon and other subjects have a significant interest in obtaining a hearing and a final decision in a prompt and efficient manner so that indicated reports, if mistaken, are expunged as quickly as possible to minimize their damaging impact.

"The state has a similarly significant interest in protecting the welfare of children, and the central register is one mechanism the state uses to protect children from abuse and neglect.

"The department justifies delays in the appellate process in this case by asserting that the time periods were reasonable and that this court should not require the department to strictly comply with its own regulations.

"The department is correct that providing due process is not automatically synonymous with compliance with state regulations. Instead, the state must act reasonably when depriving a person of a protected interest to avoid infringing on the person's due process rights.

"Several Illinois cases have evaluated the reasonableness of delays in the administrative appeals process provided under the act. However, we agree with the Appellate Court that this issue cannot be resolved merely by comparing the lengths of delays because the courts in these cases failed to consider the related issue of the standard of proof when resolving the due process claims.

"The standard of proof applied has a direct influence on the risk of erroneous judgments. When a higher standard of proof is applied, there is a reduced risk of finding an innocent person guilty and an increased risk of acquitting a guilty person.

"The applicable standard of proof in a particular proceeding, therefore, should be chosen based on a consideration of what balance of the risk of these two types of errors is appropriate under the circumstances.

"We conclude that the interests of indicated subjects and the state, on behalf of children, are both significant. However, we find it is appropriate to place more of the risk of error on adults, who may suffer mistaken employment hardship, than on children, who may suffer additional abuse.

"Thus, we must evaluate whether the use of the credible evidence standard to support the indicated finding and the decision in the first stage of appeal distributes the risk of error properly given the delays in the provision of Lyon's administrative appeal.

" 'Credible evidence' means that 'the available facts, when viewed in light of the surrounding circumstances, would cause a reasonable person to believe that a child was abused or neglected.' At the hearing on appeal, the department has the burden of proving that the indicated finding is supported by a preponderance of the evidence.

" 'Preponderance of the evidence' is defined as 'the greater weight of the evidence or evidence which renders a fact more likely than not.'

"In Lyon's case, the indicated finding was determined to be supported by credible evidence at the completion of the investigation and upon denial of Lyon's first-stage appeal, which is the standard required by regulation.

"The decision from the second-stage appeal, the administrative hearing, was evaluated under the preponderance-of-the-evidence standard, also in compliance with the rules. Despite regulatory compliance, however, we recognize that the use of the credible-evidence standard of proof in early stages of the administrative appeals process may raise due process concerns.

"The New York Court of Appeals, the state's highest court, explained the dangers of using the minimal credible-evidence standard in a case analogous to the present case:

" 'Abuse frequently involves private conduct and is based upon the reports of minors or actions of a minor observed and interpreted by others. There may be no supporting eyewitness testimony or objective evidence to support the report and therefore the evaluation of it may involve, to a large degree, subjective determinations of credibility.

" 'Under the present standard a fact finder in such cases may be tempted to rely on an intuitive determination, ignoring any contrary evidence. The risk of error is placed entirely on the subject of the report for there is no requirement that the fact finder must consider, let alone evaluate, evidence favorable to the subject.

" 'Not surprisingly this process results in a disturbingly high number of false positive findings of abuse.' Lee TT, 87 N.Y.2d at 711-12.
"As in New York, the credible-evidence standard in Illinois does not require the fact finder to consider contrary evidence. As a result, we agree with the New York Court of Appeals that the credible-evidence standard places the risk of error entirely on the subject.

"This risk of error is not insignificant; New York and Illinois both have a strikingly high rate of reversal of challenged indicated findings based on credible evidence.

"In contrast, the risk of error under the preponderance-of-the-evidence standard is distributed much more evenly.

"Because proof by a preponderance of the evidence requires that the litigants share the risk of error in a roughly equal fashion, it rationally should be applied only when the interests at stake are of roughly equal societal importance.

"The final administrative decision, the director's decision following a hearing, is conducted under this higher standard with the department bearing the burden of proof.

"We again apply the Mathews test to evaluate the standard of proof. We recognize that Lyon has a significant interest in not having an indicated report against him in the central register because of its negative impact on his chosen career. Clearly, this interest is advanced by application of a higher standard of proof that leads to fewer errors in indicated findings. The state also has a significant interest in protecting the welfare of children in part through the administration of the central register.

"The state's interest is promoted by application of a lower standard of proof that allows the state to intervene quickly, possibly preventing additional abuse, although the state also has a contrary interest in avoiding mistakes.

"In weighing these opposing interests, we again recognize that they are similarly important but that we will place more of the risk of error on the subjects rather than the children.

"In light of these considerations, we conclude that the use of the credible- evidence standard to indicate a report and to consider a first-stage appeal does not automatically deprive a subject of due process because the second- stage appeal is conducted under the more stringent preponderance standard.

"By using a weaker standard of proof, the state is equipped to respond more quickly to allegations of abuse and neglect. We find that it is constitutionally acceptable to place the entire risk of error, through use of the credible-evidence standard, on the subject for the finite period of the administrative appeal because the appeal is finally determined under the preponderance standard, which balances the risk of error equally.

"Nevertheless, this distribution of the risk of error becomes problematic when the subject is not accorded a prompt appeal. We conclude that it is constitutionally inappropriate to allow indicated reports based on credible evidence, with their damaging effects on subjects, to persist past the deadlines the General Assembly and the department itself decided to impose upon the administrative appeals process given the high risk of error inherent in the use of the credible-evidence standard.

"Thus, we agree with the Appellate Court and hold that a subject's due process rights are violated by the use of the credible-evidence standard to indicate a report and to resolve a first-stage appeal when combined with delays in the final resolution of the administrative appeal."

"The department violated Lyon's due process rights through the combination of the department's use of the low credible-evidence standard to indicate the report against Lyon and to deny his first-stage appeal and of delays in the provision of the hearing and of the final administrative decision.

"Thus, the Appellate Court properly affirmed the expunction of the indicated reports against Lyon from the State Central Register."

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