A BILL TO BE ENTITLED
AN ACT TO MODIFY THE PROCEDURES CONCERNING FINAL ADMINISTRATIVE DECISIONS IN CONTESTED CASES HEARD BY THE OFFICE OF ADMINISTRATIVE HEARINGS.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 150B‑2(5) reads as rewritten:
"(5)	"Party" means any person or agency named or admitted as a party or properly seeking as of right to be admitted as a party and includes the agency as appropriate. "
SECTION 2.  G.S. 150B‑23(a) reads as rewritten:
"(a)	A contested case shall be commenced by paying a fee in an amount established in G.S. 150B‑23.2 and by filing a petition with the Office of Administrative Hearings and, except as provided in Article 3A of this Chapter, shall be conducted by that Office. The party who files the petition shall serve a copy of the petition on all other parties and, if the dispute concerns a license, the person who holds the license. A party who files a petition shall file a certificate of service together with the petition. A petition shall be signed by a party or a representative of the party and, if filed by a party other than an agency, shall state facts tending to establish that the agency named as the respondent has deprived the petitioner of property, has ordered the petitioner to pay a fine or civil penalty, or has otherwise substantially prejudiced the petitioner's rights and that the agency:
(1)	Exceeded its authority or jurisdiction;
(2)	Acted erroneously;
(3)	Failed to use proper procedure;
(4)	Acted arbitrarily or capriciously; or
(5)	Failed to act as required by law or rule.
The parties in a contested case shall be given an opportunity for a hearing without undue delay. Any person aggrieved may commence a contested case hereunder.
A local government employee, applicant for employment, or former employee to whom Chapter 126 of the General Statutes applies may commence a contested case under this Article in the same manner as any other petitioner. The case shall be conducted in the same manner as other contested cases under this Article."
SECTION 3.  G.S. 150B‑33(b)(12) is repealed.
SECTION 4.  G.S. 150B‑34 reads as rewritten:
"§ 150B‑34.  Final decision or order.
(a)	In each contested case the administrative law judge shall make a final decision or order that contains findings of fact and conclusions of law. The administrative law judge shall decide the case based upon the preponderance of the evidence, giving due regard to the demonstrated knowledge and expertise of the agency with respect to facts and inferences within the specialized knowledge of the agency. (b)	Repealed by Session Laws 1991, c. 35, s. 6.
	(d)	Except for the exemptions contained in G.S. 150B‑1, the provisions of this section regarding the decision of the administrative law judge shall apply to all agencies subject to Article 3 of this Chapter, notwithstanding any other provisions to the contrary relating to recommended decisions by administrative law judges.
(e)	An administrative law judge may grant judgment on the pleadings, pursuant to a motion made in accordance with G.S. 1A‑1, Rule 12(c), or summary judgment, pursuant to a motion made in accordance with G.S. 1A‑1, Rule 56, that disposes of all issues in the contested case. Notwithstanding subsection (a) of this section, a decision granting a motion for judgment on the pleadings or summary judgment need not include findings of fact or conclusions of law, except as determined by the administrative law judge to be required or allowed by G.S. 1A‑1, Rule 12(c) or Rule 56. A decision by the administrative law judge granting judgment on the pleadings or summary judgment that disposes of all issues in the contested case operates as a final decision."
SECTION 5.  G.S. 150B‑35 reads as rewritten:
"§ 150B‑35.  No ex parte communication; exceptions.
Unless required for disposition of an ex parte matter authorized by law, the administrative law judge assigned to a contested case may not communicate, directly or indirectly, in connection with any issue of fact, or question of law, with any person or party or his representative, except on notice and opportunity for all parties to participate."
SECTION 6.  G.S. 150B‑36 is repealed.
SECTION 7.  G.S. 150B‑37 reads as rewritten:
"§ 150B‑37.  Official record.
(a)	In a contested case, the Office of Administrative Hearings shall prepare an official record of the case that includes:
(1)	Notices, pleadings, motions, and intermediate rulings;
(2)	Questions and offers of proof, objections, and rulings thereon;
(3)	Evidence presented;
(4)	Matters officially noticed, except matters so obvious that a statement of them would serve no useful purpose; and
(5)	Repealed by Session Laws 1987, c. 878, s. 25.
(6)	The administrative law judge's final decision or order.
(b)	Proceedings at which oral evidence is presented shall be recorded, but need not be transcribed unless requested by a party. Each party shall bear the cost of the transcript or part thereof or copy of said transcript or part thereof which said party requests, and said transcript or part thereof shall be added to the official record as an exhibit.
(c)	The Office of Administrative Hearings shall forward a copy of the administrative law judge's final decision to each party."
SECTION 8.  G.S. 150B‑40(e) reads as rewritten:
"(e)	When a majority of an agency is unable or elects not to hear a contested case, the agency shall apply to the Director of the Office of Administrative Hearings for the designation of an administrative law judge to preside at the hearing of a contested case under this Article. Upon receipt of the application, the Director shall, without undue delay, assign an administrative law judge to hear the case.
The provisions of Article 3 of this Chapter shall govern a contested case in which the agency requests an administrative law judge from the Office of Administrative Hearings.
An administrative law judge shall stay any contested case under this Article on motion of an agency which is a party to the contested case, if the agency shows by supporting affidavits that it is engaged in other litigation or administrative proceedings, by whatever name called, with or before a federal agency, and this other litigation or administrative proceedings will determine the position, in whole or in part, of the agency in the contested case. At the conclusion of the other litigation or administrative proceedings, the contested case shall proceed and be determined as expeditiously as possible.
"
SECTION 9.  G.S. 150B‑43 reads as rewritten:
"§ 150B‑43.  Right to judicial review.
Any party who is aggrieved by the final decision in a contested case, and who has exhausted all administrative remedies made available to the party by statute or agency rule, is entitled to judicial review of the decision under this Article, unless adequate procedure for judicial review is provided by another statute, in which case the review shall be under such other statute. Nothing in this Chapter shall prevent any party from invoking any judicial remedy available to the party under the law to test the validity of any administrative action not made reviewable under this Article."
SECTION 10.  G.S. 150B‑44 reads as rewritten:
"§ 150B‑44.  Right to judicial intervention when decision unreasonably delayed.
Unreasonable delay on the part of any agency or administrative law judge in taking any required action shall be justification for any person whose rights, duties, or privileges are adversely affected by such delay to seek a court order compelling action by the agency or administrative law judge. Failure of an administrative law judge subject to Article 3 of this Chapter or failure of an agency subject to Article 3A of this Chapter to make a final decision within 120 days of the close of the contested case hearing is justification for a person whose rights, duties, or privileges are adversely affected by the delay to seek a court order compelling action by the agency or by the administrative law judge. The Board of Trustees of the North Carolina State Health Plan for Teachers and State Employees is a "board" for purposes of this section."
SECTION 11.  G.S. 150B‑47 reads as rewritten:
"§ 150B‑47.  Records filed with clerk of superior court; contents of records; costs.
Within 30 days after receipt of the copy of the petition for review, or within such additional time as the court may allow, the Office of Administrative Hearings shall transmit to the reviewing court the original or a certified copy of the official record in the contested case under  review. With the permission of the court, the record may be shortened by stipulation of all parties to the review proceedings. Any party unreasonably refusing to stipulate to limit the record may be taxed by the court for such additional costs as may be occasioned by the refusal. The court may require or permit subsequent corrections or additions to the record when deemed desirable."
SECTION 12.  G.S. 150B‑49 reads as rewritten:
"§ 150B‑49.  New evidence.
A party who files a petition in the superior court may apply to the court to present additional evidence. If the court is satisfied that the evidence is material to the issues, is not merely cumulative, and could not reasonably have been presented at the administrative hearing, the court may remand the case so that additional evidence can be taken. If an administrative law judge did not make a final decision in the case, the court shall remand the case to the agency that conducted the administrative hearing under Article 3A of this Chapter and G.S. 150B‑34(c). After hearing the evidence, the agency may affirm or modify its previous findings of fact and final decision. If an administrative law judge made a final decision in the case, the court shall remand the case to the administrative law judge. After hearing the evidence, the administrative law judge may affirm or modify the previous findings of fact and final decision. The additional evidence and any affirmation or modification of a final decision shall be made part of the official record."
SECTION 13.  G.S. 150B‑50 reads as rewritten:
"§ 150B‑50.  Review by superior court without jury.
The review by a superior court of administrative decisions under this Chapter shall be conducted by the court without a jury."
SECTION 14.  G.S. 150B‑51 reads as rewritten:
"§ 150B‑51.   Scope and standard of review.
		(b)	The court reviewing a final decision may affirm the decision or remand the case for further proceedings. It may also reverse or modify the decision if the substantial rights of the petitioners may have been prejudiced because the findings, inferences, conclusions, or decisions are:
(1)	In violation of constitutional provisions;
(2)	In excess of the statutory authority or jurisdiction of the agency;
(3)	Made upon unlawful procedure;
(4)	Affected by other error of law;
(5)	Unsupported by substantial evidence admissible under G.S. 150B‑29(a), 150B‑30, or 150B‑31 in view of the entire record as submitted; or
(6)	Arbitrary, capricious, or an abuse of discretion.
(c)	In reviewing a final decision in a contested case, the court shall review the official record, de novo, and shall make findings of fact and conclusions of law. In reviewing the case, 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 final decision. The court shall determine whether the petitioner is entitled to the relief sought in the petition, based upon its review of the official record. The court reviewing a final decision under this subsection may adopt the decision; may adopt, reverse, or modify the decision; may remand the case for further explanations or reverse or modify the final decision for the failure to provide the explanations; and may take any other action allowed by law.
(d)	In reviewing a final decision allowing judgment on the pleadings or summary judgment, the court may enter any order allowed by G.S. 1A‑1, Rule 12(c) or Rule 56. If the order of the court does not fully adjudicate the case, the court shall remand the case to the administrative law judge for such further proceedings as are just."
SECTION 15.  This act becomes effective January 1, 2011, and applies to contested cases commenced on or after that date.