As many readers of this blog likely will be aware, the doctrine of administrative deference — the extent to which courts may properly defer to agencies’ interpretations of statutes and/or rules — has been a hot topic in recent years in the United States Supreme Court.
In Kisor v. Wilkie, for example, the Supreme Court addressed a three-step process for how courts, in litigation, should consider deference to an agency’s interpretation of its own rule, by asking:
- is the rule genuinely ambiguous?
- if so, is the agency’s interpretation of the genuine ambiguity reasonable; and
- even if an agency interpretation is reasonable, is it of a “character and context” that justifies deference by courts?
Administrative deference has also been a subject of considerable debate in Ohio. Ohio Supreme Court Justice Pat DeWine has long been interested in the topic. In multiple opinions since joining the bench in 2017, he made it clear that he was waiting for an appropriate case in which to revisit how (or if) Ohio courts should defer to administrative agencies’ interpretations of rules or statutes.
A chance to revisit and clarify Ohio’s administrative deference doctrine
Justice DeWine got his chance in his opinion for the majority in TWISM Enterprises, LLC v. State Board of Registration for Professional Engineers & Surveyors, issued on Dec. 29, 2022. The case involved a company that sought to designate an independent contractor — not an employee — as being “in responsible charge” of the company’s engineering activities, so that the company could lawfully provide engineering services in the State. The State Board of Registration for Professional Engineers & Surveyors interpreted its own administrative rules and governing statute to say that this could not be done with an independent contractor. But, the Ohio Supreme Court disagreed — declining to defer to the board’s interpretation of its own rules. In his opinion for the majority in TWISM Enterprises, Justice DeWine seized the opportunity to revisit and clarify Ohio’s approach to administrative deference.
First, Justice DeWine noted how inconsistent Ohio case law has been over the years on the topic of administrative deference. In paragraphs 22-28 of his Opinion, he explained that sometimes the Ohio Supreme Court has suggested that courts owe “conclusive deference” to an agency’s interpretation of a statute that the agency has the duty to enforce, so long as the interpretation is “reasonable.”
Other times, the Ohio Supreme Court has adopted an approach more closely resembling the U.S. Supreme Court’s Chevron approach, according deference to reasonable interpretations of statutes if, and only if, the legislative intent of the statute is ambiguous. In a third line of cases, the Court has said that courts “may” rely on the expertise of a state agency.
New parameters for administrative deference in Ohio
After explaining why the Ohio Supreme Court’s precedent fails to articulate “any justification or consistent standard for agency deference,” Justice DeWine then did two very significant things in the TWISM opinion. First, in Paragraphs 42-43, he rejected “all forms of mandatory deference” to administrative agency interpretations, based on the separation-of-powers doctrine enshrined in the Ohio Constitution. Then, in Paragraphs 44-47, he clarified the limited circumstances when a court “may” — but is not required to — consider an administrative agency’s construction of a legal text. As Justice DeWine went on to explain:
- An administrative interpretation should never be used to “alter the meaning of clear text. If the text is unambiguous, the court should stop right there.” (Paragraph 44).
- If a text is ambiguous, a court may consider an administrative interpretation, “along with other tools of interpretation.” But “the weight, if any, the court assigns to the administrative interpretation should depend on the persuasive power of the agency’s interpretation and not on the mere fact that it is being offered by an administrative agency. A court may find agency input informative; or the court may find the agency position unconvincing. What a court may not do is outsource the interpretive project to a coordinate branch of government.” (Paragraph 45).
- On this latter point, Justice DeWine explained that “deference in Ohio bears similarities to the rule announced by the United States Supreme Court in Skidmore.” (Paragraph 46, citing Skidmore v. Swift & Co.).
Practical considerations for assignments of error and appellate briefs
Justice DeWine’s opinion in TWISM, which was joined by Justices Kennedy, Fischer and Donnelly, is a must-read for regulated entities in Ohio that in litigation must either defend or challenge their regulating agencies’ interpretations of statutes or administrative rules. The opinion also has practical ramifications for Ohio lawyers when it comes to drafting assignments of error in an appeal, briefing those assignments of error, and developing Propositions of Law in the Ohio Supreme Court.
Instead of hanging your hat on reflexive deference to the agency’s position, TWISM suggests that practitioners focus instead on the text of the rule or statute in question, whether any genuine ambiguity exists, and (only if so) whether the agency’s position is persuasive. Because TWISM may have the practical effect of encouraging greater judicial freedom from long-held agency interpretations, it will also be interesting to see whether more conflicts arise between Ohio’s appellate districts interpreting agency rules and enabling legislation.