COA Issues APA Decision On Agency Deference

The COA today held that when an agency fails to adopt an ALJ's decision in a contested case, the superior court may not defer to the agency's interpretation, in the case, of the statute at issue. The case is Rainey v. NC Dep't of Public Instruction. The agency declined to adopt the ALJ's decision, and the superior court affirmed, concluding it could "give appropriate weight to an Agency's demonstrated expertise and consistency in applying various statutes." The COA disagreed, invoking the APA, specifically the anti-deference mandate in G.S. 150B-51(c), which says that where an agency doesn't adopt the decision of the ALJ, "the court shall review the official record, de novo, and shall make findings of fact and conclusions of law," and in so doing, "the court shall not give deference to any prior decision made in the case and shall not be bound by the findings of fact or the conclusions of law contained in the agency's final decision." The COA held that, "Deference to the agency is inconsistent with this mandate" and therefore "the trial court erred in its application of the standard of review."