Also known as: administrative order · admin orders
Written by attorneys — see sources below.
A formal directive or grant of permission issued by an administrative agency charged with interpreting or enforcing a law. Reliance on such an order later determined to be invalid or erroneous supplies a defense to criminal liability when the reliance is reasonable.
Aaron Adams requested a written classification ruling from the federal trade office before shipping navigation components. The ruling stated the parts were not controlled. Aaron exported the parts in reliance on that statement. When a later agency determination found the classification erroneous, the reasonable reliance on the administrative order established a defense to the export charge.
Apex Dynamics received an administrative order imposing price controls during wartime. The company complied with the order while challenging its constitutionality in enforcement proceedings. The order remained binding until reviewed, and violations carried criminal penalties even though the underlying validity was contested in court.
Congress enacted the Emergency Price Control Act on January 30, 1942, as a temporary wartime measure. Congress amended it by the Stabilization Act of October 2, 1942. The Act authorized the Price Administrator, after consultation with industry representatives, to issue regulations fixing maximum prices that in his judgment would be generally fair and equitable and would effectuate the Act's purposes of stabilizing prices and preventing inflation. On April 28, 1942, the Administrator issued the General Maximum Price Regulation effective May 11, 1942, setting maximum prices at the highest price charged by the seller during March 1942. On December 10, 1942, the Administrator issued Revised Maximum Price Regulation No. 169, establishing specific maximum prices for wholesale cuts of beef and veal. Petitioners Yakus and others operated wholesale meat businesses in Massachusetts. Between December 1942 and early 1943 they sold wholesale cuts of beef at prices exceeding the maximums prescribed by Revised Maximum Price Regulation No. 169. Federal grand juries in the District of Massachusetts returned indictments charging them with willful violations of sections 4(a) and 205(b) of the Act. When the indictments were returned, the sixty-day period for filing administrative protests against the regulation had already expired. At trial the petitioners offered evidence on the validity of the regulation. They contended that the prices it fixed were not generally fair and equitable and that enforcement would compel them to sell at a loss. The district court excluded the evidence as irrelevant. It refused to submit the validity issue to the jury and convicted the petitioners on verdicts of guilty. The Circuit Court of Appeals for the First Circuit affirmed the convictions. Petitioners in related cases were likewise convicted in the same district court for selling processed textile futures above maximum prices established by Maximum Price Regulation No. 188 and Supplementary Regulation No. 271. Those convictions were also affirmed on appeal. The Supreme Court granted certiorari in all cases because of the importance of the issues to administration of the Act.
View caseThe defense applies when a person acts in reasonable reliance on an official statement contained in an administrative order or grant of permission issued by the public officer or body charged with interpreting or enforcing the law. The order must later be determined invalid or erroneous. The defendant must prove the defense by a preponderance of the evidence.
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Common law did not permit a defense based on reliance on an incorrect official statement of the law. This rule applied even when the erroneous statement appeared in an administrative order or grant.
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The defendant must show that the administrative order came from the agency charged with responsibility for the law, that the reliance was reasonable, and that the order was later found invalid or erroneous. Proof is by a preponderance of the evidence.
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…proceedings, still less when these are civil in character and the later enforcement phase is criminal. In the enforcement of administrative orders the courts have been assiduous, perhaps at times extremely so, to see that constitutional protections to the persons affected are observed. By trial and error, ways have been found…