Pulito v. Board of Nursing

612

Argued and submitted November 14, 2019; decision of Court of Appeals

reversed, final order of Oregon State Board of Nursing reversed, and case

remanded to board for further proceedings July 2, 2020

Rebecca PULITO,

Petitioner on Review,

v.

OREGON STATE BOARD OF NURSING,

Respondent on Review.

(OSBN 1600671) (CA A165993) (SC S066569)

468 P3d 401

The Oregon State Board of Nursing sought to revoke licensee’s registered

nurse license and an administrative law judge (ALJ) was assigned to preside

over the case. Licensee requested the assignment of a different ALJ, but the

chief ALJ denied her request as “untimely” under OAR 471-060-0005. Licensee

argued that OAR 471-060-0005 is invalid because it fails to implement proper

“time limitations” as directed by ORS 183.645. The initially assigned ALJ issued

a proposed order revoking licensee’s nurse license, which the board adopted as

its final order. The Court of Appeals affirmed without opinion. Held: (1) The term

“time limitations” in ORS 183.645(1) means a specific period of time, identifiable

at the outset; (2) OAR 471-060-0005 is invalid because it fails to establish proper

time limitations; (3) the chief ALJ erred in relying on an invalid rule to deny

licensee’s request for a different ALJ and that denial may have impaired the fair-

ness of the proceedings; and (4) the board erred in assuming the validity of OAR

471-060-0005 in its final order.

The decision of the Court of Appeals is reversed. The final order of the Oregon

State Board of Nursing is reversed, and the case is remanded to the board for

further proceedings.

On review from the Court of Appeals.*

Kevin Keaney, Portland, argued the cause and filed the

briefs for petitioner on review.

Jona J. Maukonen, Assistant Attorney General, Salem,

argued the cause and filed the brief for respondent on

review. Also on the brief were Ellen F. Rosenblum, Attorney

General, and Benjamin Gutman, Solicitor General.

______________

* On judicial review of a final order from the Oregon State Board of Nursing.

295 Or App 669, 433 P3d 790 (2019).

Cite as 366 Or 612 (2020) 613

Before Walters, Chief Justice, and Balmer, Nakamoto,

Flynn, Duncan, and Nelson, Justices, and Linder, Senior

Judge, Justice pro tempore.**

NELSON, J.

The decision of the Court of Appeals is reversed. The final

order of the Oregon State Board of Nursing is reversed, and

the case is remanded to the board for further proceedings.

______________

** Garrett, J., did not participate in the consideration or decision of this case.

614 Pulito v. Board of Nursing

NELSON, J.

The issue in this judicial review of a final order of

the Oregon State Board of Nursing (the board) is the mean-

ing of the term “time limitations” in ORS 183.645(1). That

statute requires the chief administrative law judge (ALJ)

to assign a different ALJ to a contested case on written

request from a party, subject to applicable “time limitations”

that the chief ALJ has established by rule for submitting

such requests. The chief ALJ established OAR 471-060-

0005, under which the chief ALJ evaluates the timeliness

of a request by determining whether a party had a “reason-

able opportunity” to make an earlier request. Licensee chal-

lenges a preliminary decision of the chief ALJ that denied

her request for a different ALJ. In that decision, the chief

ALJ determined that licensee had failed to take advantage

of a “reasonable opportunity” to make an earlier request.

The contested case proceeded on the merits, and the board

issued a final order revoking licensee’s nursing license. The

Court of Appeals affirmed without opinion. Pulito v. Oregon

State Board of Nursing, 295 Or App 669, 433 P3d 790 (2019).

Licensee petitioned this court for review, which we allowed.

In licensee’s view, the denial of her request for a dif-

ferent ALJ was error. She contends that OAR 471-060-0005

is invalid because it does not impose a “time limitation” as

authorized by ORS 183.645(1). Alternatively, she contends

that the chief ALJ erred in applying OAR 471-060-0005

because her request for a different ALJ was made within a

reasonable time. For the reasons explained below, we con-

clude that OAR 471-060-0005 is invalid as written and that

the error in denying licensee’s request for a different ALJ

requires reversal. Because that ruling is dispositive, we do

not reach licensee’s alternative argument that the chief ALJ

erred in applying the rule. Accordingly, we reverse the final

order of the board and remand for a new hearing.

I. BACKGROUND

In February 2015, licensee self-reported to the board

that she had struggled with substance abuse and was receiv-

ing treatment. The board decided that licensee must enter a

program for health professionals that required regular drug

Cite as 366 Or 612 (2020) 615

monitoring, with a program monitor reporting her progress

to the board. Based on reports from the program monitor, in

November 2015, the board notified licensee that it proposed

to revoke her registered nurse license. Licensee requested

a hearing on that proposed revocation, and her case was

referred to the Office of Administrative Hearings (OAH) as

a contested case.

On December 21, 2015, OAH mailed licensee—who,

at the time, was not represented by legal counsel—a notice of

her hearing date. That notice also informed her which ALJ

had been assigned to the case. By January 14, 2016, licensee

had retained counsel. On January 18, 2016, through her

counsel, licensee submitted a written request for a different

ALJ, which OAH received on January 19, 2016. The chief

ALJ1 denied that request, concluding that it was “untimely.”

Licensee, through counsel, moved for reconsideration, argu-

ing that the chief ALJ could not deny as “untimely” her

request, when the chief ALJ had not established applicable

“time limitations” by rule, as required by ORS 183.645(1).

Licensee argued that it was “clear error to impose a time

limitation when none existed.” The chief ALJ issued a rul-

ing denying licensee’s motion, reasoning that OAR 471-060-

0005 was a proper implementation of ORS 183.645:

“[OAR 471-060-0005] does not establish an arbitrary

and inflexible deadline for making such a request. Nor

does the statutory authority to establish ‘time limitations

and procedures’ mandate the adoption of a strict dead-

line. Instead, the rule requires that the timeliness of such

a request be assessed under the totality of the circum-

stances. [Licensee] * * * presents no argument as to why

[she] believes that this rule is not sufficient to establish

the time limitations allowed by ORS 183.645(1). * * * The

request for reconsideration is denied.”

After the chief ALJ’s ruling, the contested case pro-

ceeded with the same ALJ who had been initially assigned to

it. A hearing was held, and the assigned ALJ subsequently

issued a proposed order revoking licensee’s registered nurse

1

It appears that the “presiding ALJ” was acting as the “designee” of the chief

ALJ at this time. See OAR 471-060-0005(3) (providing that “[t]he Chief adminis-

trative law judge or designee shall decide all requests” (emphasis added)). We use

the term “chief ALJ” in this opinion to describe the actions of the designee.

616 Pulito v. Board of Nursing

license. Licensee filed exceptions to that proposed order,

incorporating by reference her request for a different ALJ

and her motion for reconsideration, urging the board to

find that the ALJ’s proposed order was error because it was

based on OAR 471-060-0005, which licensee had argued was

invalid. The board adopted, in substantial part, the ALJ’s

proposed order, including as procedural history a statement

that licensee’s request for a different ALJ had been denied

as untimely. The board’s final order revoked licensee’s nurs-

ing license.

Licensee then moved the board for a stay of enforce-

ment of the final order while judicial review was pending,

asserting that the chief ALJ had erred in denying her

request for a different ALJ. When the board denied licens-

ee’s motion, licensee moved the Court of Appeals to review

the board’s denial of her request for a stay. Arguing against a

stay, the board contended that, in denying licensee’s request

for a different ALJ, an important concern to OAH was con-

trol of its docket volume and that OAH’s internal practice

therefore had been to “routinely den[y] requests” even when

those requests were made only a few days after assignment

of an ALJ. The Court of Appeals granted licensee’s motion

to stay enforcement of the final order, pending final disposi-

tion on judicial review. In its order to that effect, the court

determined that the board’s argument was countered by the

fact that

“lay citizens dealing with state agencies reasonably would

not be aware of OAH’s docket problem or OAH’s practice

of denying requests for reassignment unless the request

is submitted within a few days after notice of assignment.

Indeed, the board makes no showing that attorneys typi-

cally know of OAH’s practice.”

The Court of Appeals later affirmed the board’s

final order without opinion, Pulito, 295 Or App 669. We then

allowed licensee’s petition for review.

II. DISCUSSION

Licensee contends that OAR 471-060-0005 is

invalid because it is inconsistent with ORS 183.645(1), which

requires the chief ALJ to “assign a different [ALJ] for the

Cite as 366 Or 612 (2020) 617

hearing upon receiving a written request” and authorizes

the chief ALJ to establish by rule “time limitations and pro-

cedures for requests.” The rule that the chief ALJ has estab-

lished is OAR 471-060-0005, which provides, in part:

“(1) The purpose of this rule is to establish uniform

procedures for the change of assignment of administrative

law judges.

“* * * * *

“(3) Every party and agency in a contested case is enti-

tled to request a change of administrative law judge. The

first request of that party or agency shall be automatically

granted. If that party or agency makes a subsequent request,

it must show good cause why the administrative law judge

should not preside over the hearing. The Chief administra-

tive law judge or designee shall decide all requests.

“(4) Notwithstanding section (3), no request shall be

granted if a party or agency had a reasonable opportunity to

request a change of administrative law judge but did not do

so. Reasonable opportunity is determined under the totality

of circumstances.”

(Internal quotation marks omitted; emphases added.)

Under OAR 471-060-0005(3), every party or agency2

is “entitled to request a change of administrative law judge,”

and the first such request “shall be automatically granted.”

Then, a “subsequent request” requires a party to show “good

cause” why a particular ALJ should not preside. That text,

on its face, suggests that first requests are to be automat-

ically granted—that nothing else is required of a party

beyond the request itself—and that subsequent requests are

to be granted only if a party shows good cause. However,

section (4) provides that “no request shall be granted if a

party had a reasonable opportunity to request a change of

[ALJ] but did not do so.” (Emphasis added.)

2

We acknowledge that the definitions of “party” and “agency” in ORS

183.310 are distinct, and that a “party” is a “person or agency” that is “entitled

as of right to a hearing before the agency” or “named by the agency to be a party.”

ORS 183.310(7). Further, that an “agency” is “any state board, commission,

department.” ORS 183.310(1). However, we use the term “party” in this opinion

to describe both a party and an agency, understanding that either may request

the assignment of a different ALJ under ORS 183.645 and OAR 471-060-0005.

618 Pulito v. Board of Nursing

In licensee’s view, OAR 471-060-0005(4) fails to

adopt proper “time limitations,” as authorized by ORS

183.645(1). Licensee contends that the term “time limita-

tions” in ORS 183.645(1) means a specific time period, such

as “days, weeks, months, or years,” but OAR 471-060-0005(4)

impermissibly sets forth a method by which the chief ALJ

determines, on a case-by-case basis, whether a party took

advantage of a “reasonable opportunity” to make a request.

The board counters that OAR 471-060-0005 is valid because

ORS 183.645(1) does not mandate the adoption of a specific

time period but, rather, “delegate[es] broad authority to the

chief ALJ to determine an appropriate time limitation.” For

the reasons explained below, we agree with licensee.

A. Controlling Principles

This court may determine the validity of a rule upon

review of an agency’s order. ORS 183.400(2); Hay v. Dept. of

Transportation, 301 Or 129, 137, 719 P2d 860 (1986). When

a challenge to the validity of an administrative rule is based

on a claim that the rule violates a statute, our standard for

judicial review is whether the rule “[e]xceeds the statutory

authority of the agency.” ORS 183.400(4)(b). “Authority,” as

used in ORS 183.400(4)(b), does not refer to only the agen-

cy’s overall “jurisdiction.” Rather, “[t]o the extent that the

rule departs from the statutory policy directive, it ‘exceeds

the statutory authority of the agency’ within the meaning

of those words in ORS 183.400(4)(b).” Planned Parenthood

Assn. v. Dept. of Human Res., 297 Or 562, 573, 687 P2d 785

(1984). Accordingly, we must determine whether OAR 471-

060-0005 “depart[s] from a legal standard expressed or

implied in the particular law being administered.” Nay v.

Dept. of Human Services, 360 Or 668, 695, 385 P3d 1001

(2016) (citing Planned Parenthood, 297 Or at 565).

The law being administered is ORS 183.645. The

question whether OAR 471-060-0005 “departs from the

legal standard expressed or implied” in ORS 183.645 is one

of legislative intent—that is, by authorizing the chief ALJ

to establish by rule “time limitations,” in ORS 183.645, did

the legislature intend that the rule adopted would provide

a specific time period within which a first request must be

made? Or, did the legislature intend that the rule adopted

Cite as 366 Or 612 (2020) 619

would provide the chief ALJ with broad authority to estab-

lish any method by which to evaluate timeliness, including

a “reasonable opportunity” standard, determined under the

totality of the circumstances in each case? Under Oregon’s

Administrative Procedures Act (APA), interpretation is a

question of law ultimately for the court. ORS 183.482(8)(a).

Interpreting the term “time limitations” in ORS

183.645 requires us to apply the familiar principles of statu-

tory construction set out in State v. Gaines, 346 Or 160, 171-73,

206 P3d 1042 (2009). To determine what the legislature

intended, we examine the text of ORS 183.645 in context,

together with any legislative history3 that aids our analysis.

Id. In the absence of evidence to the contrary, we assume

that the legislature intended words of common usage to be

given their ordinary meanings. OR-OSHA v. CBI Services,

Inc., 356 Or 577, 589, 341 P3d 701 (2014).

B. Statutory Interpretation of ORS 183.645

1. Text

We begin with the text of ORS 183.645(1) and (2),

which provides:

“(1) After assignment of an administrative law judge

from the Office of Administrative Hearings to conduct a

hearing on behalf of an agency, the chief administrative

law judge shall assign a different administrative law judge

for the hearing upon receiving a written request from any

party in the contested case or from the agency. The chief

administrative law judge may by rule establish time lim-

itations and procedures for requests under this section.

“(2) Only one request for a change of assignment of

administrative law judge under subsection (1) of this sec-

tion may be granted by the chief administrative law judge

without a showing of good cause. If a party or agency fails

to make a request under subsection (1) of this section

within the time allowed, or if a party or agency objects to

an administrative law judge assigned after a request for a

different administrative law judge has been granted under

subsection (1) of this section, the chief administrative law

3

No legislative history sheds light on the meaning of the term “time limita-

tions” in ORS 183.645.

620 Pulito v. Board of Nursing

judge shall assign a different administrative law judge

only upon a showing of good cause.”

Thus, subsection (1) provides that, after an ALJ

has been assigned to a contested case, the chief ALJ shall

assign a different ALJ upon written request. Subsection (1)

further provides that the chief ALJ “may by rule establish

time limitations and procedures for requests.” Subsection

(2) provides, “[o]nly one request for a change of [ALJ] under

subsection (1) of this section may be granted * * * without

showing good cause.” Further, if a request is not submitted

“within the time allowed,” then the party or agency must

show good cause.

Where ORS 183.645(1) authorizes the chief ALJ to

establish “time limitations,” the legislature did not define

that term. Without a statutory definition, “we ordinarily

look to the plain meaning of a statute’s text as a key first

step in determining what particular terms mean.” Comcast

Corp. v. Dept. of Rev., 356 Or 282, 295, 337 P3d 768 (2014).

This court frequently attempts to resolve disputes about

plain meaning by consulting dictionary definitions of the

relevant terms. State v. Gonzalez-Valenzuela, 358 Or 451,

461, 365 P3d 116 (2015).

The dictionary defines the term “time limit,” but

not “time limitation.” However, one definition of “limit” is

“limitation.” See Webster’s Third New Int’l Dictionary 1312

(unabridged ed 2002). Nevertheless, we will consider the

definition of each. The dictionary definition of “time limit”

is “a fixed period for doing or ending something * * *.” Id. at

2395.

The definition of “time” includes several meanings:

“1 a : a period during which something (as an action,

process, or condition) exists or continues : an interval com-

prising a limited and continuous action, condition, or state

of being : measured or measurable duration * * * [1] b : a

period set apart in some specified or implied way from

others * * * 2 a : a point or period when something occurs

: the moment of an event, process, or condition : occasion

* * * 3 : an appointed, fixed, or customary moment or hour

for something to happen, begin, or end * * * 4 : [relating to

historical or geological time periods] 5 : a known, fixed, or

Cite as 366 Or 612 (2020) 621

anticipated period of existence or duration * * * 6 : [seasons

of the year] 7 : [meters of time in poetry and music] 8 a : a

definite moment, hour, day, or year as indicated or fixed by

a clock or calendar : a precise instant or date * * * 9 a : one

of a series of recurring instances or repeated acts or actions

* * * 10 a : finite duration * * *.”

Id. at 2394 (boldface type in original).

The term “limitation” is defined as:

“1 : the action of limiting * * * 2 : the quality or state of

being limited * * * 3 a : a restriction or restraint imposed

from without (as by law, custom, or circumstances) * * *

4 : a time assigned for something; specifically : a certain

period limited by statute after which actions, suits, or pros-

ecutions cannot be brought in the courts * * *.”

Id. at 1312 (boldface type and italics in original).

The definitions of “time limit,” “time,” and “lim-

itation,” convey what one would assume “time limitations”

ordinarily means—that is, a time period of a fixed, cer-

tain, measurable, predictable, or finite duration; one with

a beginning and an end. The meanings of the term “time”

have the characteristic of being identifiable, such that, even

in the absence of highly specific demarcations of time, such

as “one hour” or “twelve o’clock,” the bounds within which

periods such as “dinner time” or “Spring time” exist can be

discerned or predicted.

Further, when the term “time” is paired with the

term “limitation,” a time period is restricted or restrained

to a certain period such that, due to that imposed restric-

tion, the subject act may not continue. As defined, for a time

limitation to be effective, a “limitation” on “time” must nec-

essarily indicate the instant at which a period “for doing or

ending something” concludes. Id. at 2395. A “limitation” on

“time” would be ineffective were it indefinite or undefined,

because it could not operate as a “restraint” or a “restriction”

on a time period. Id. at 1312. Thus, the dictionary definition

of the terms “time limit,” “time,” and “limitation” collectively

suggest that the plain meaning of the term “time limita-

tions” in ORS 183.645(1) is a fixed time period of objectively

identifiable or predictable bounds.

622 Pulito v. Board of Nursing

The dictionary is not the only source on which we

rely to resolve the meaning of a term. We also must criti-

cally examine how those definitions fit into the context of

the statute itself. Gonzalez-Valenzuela, 358 Or at 461.

2. Context

The context of ORS 183.645 is consistent with the

plain meaning of its key terms. That is, the context likewise

suggests that the legislature used the term “time limita-

tions” in subsection (1) to mean a fixed period of time—one

that is predictable or objectively identifiable at the outset.

Conversely, it does not suggest approval of a methodology

based on an inquiry into the circumstances of the case,

applied after a request—the subject act—has concluded.

We start at the beginning of subsection (1), which

supplies the first indication that the term “time limitations”

is an identifiable period of time for making a request for a

different ALJ (without the burden of showing good cause).

Subsection (1) provides that, “[a]fter assignment” of an ALJ,

a different ALJ shall be assigned, upon written request

from a party. The term “after” describes the certain moment

in time after which a request may be submitted. That cer-

tain moment in time is identifiable due to the occurrence of

a particular event: the assignment of an ALJ.

Similarly, the procedures by which a party obtains

a different ALJ are tied to identifiable moments in time.

Recall that subsection (1) establishes what, for shorthand

purposes, we will refer to as a “no-cause” procedure for

submitting a request. It provides that the chief ALJ “shall

assign” a different ALJ upon receiving written request to

do so. Under subsection (2), “[o]nly one request” under sub-

section (1) may be granted without a showing of good cause.

Then, subsection (2) specifies two time periods when a party

must show “good cause.” The first is when a no-cause request

is not received “within the time allowed,” and the second is

when a party objects to the assignment of an ALJ “after”

a previous request has been granted. In sum, the no-cause

procedure requires nothing more than a written request,

and the procedure requiring good cause is triggered by cer-

tain events in time. Thus, ORS 183.645 provides for both a

Cite as 366 Or 612 (2020) 623

no-cause procedure and a good cause procedure, and which

procedure applies hinges upon the moment in time that the

request is received.

By identifying a predictable, specific period of time

during which the procedure requiring good cause applies,

the context of ORS 183.645 suggests a legislative intent

that the “time limitations” established in an implemented

rule would also identify a predictable, specific period of time

during which the no-cause procedure applies.

Other aspects of the context of ORS 183.645 also

suggest that the term “time limitations” means a specific

period of time, identifiable at the outset. For example, sub-

section (2) requires a showing of good cause when a party

fails to make a request under subsection (1) “within the time

allowed.” The quoted phrase refers to the “time limitations”

that the chief ALJ may establish under subsection (1) for

the one-time, no-cause request. The words “within the time

allowed” suggest a specific period of time, because the word

“within” means “on the inside or on the inner side” and is

“used as a function word to indicate enclosure or contain-

ment.” See Webster’s at 2627. As a whole, then, the words

“within the time allowed” refer to a period of time inside

of which a no-cause request shall be permitted, and con-

versely, outside of which a no-cause request shall be denied.

Further, “within” is ordinarily an objectively identifiable

period; conveying what can be readily discerned, such as, to

illustrate, whether one is within a dwelling; within the limit

of a timed exam; or within the bounds of a playing area on

a sporting field. Because “within the time allowed” refers

directly to the “time limitations” that the chief ALJ may

establish by rule, that reference strongly suggests that the

term “time limitations” is similarly an objectively identifi-

able period of time.

To summarize, the text and context establish that,

where the legislature provided the opportunity to make a

one-time, no-cause request for a different ALJ, the chief ALJ

must grant that request if it is received “within the time

allowed,” i.e., within a specific time period. The ordinary

meaning of the term “time limitations” in ORS 183.645(1)

means a specific time period—one that provides certainty or

624 Pulito v. Board of Nursing

predictability as to when a request for a different ALJ must

be submitted—and is thus the standard from which OAR

471-060-0005 may not depart. Nay, 360 Or at 695. To the

extent that the rule “[e]xceeds the statutory authority of the

agency,” it is invalid. ORS 183.400(4)(b).

C. Analysis of OAR 471-060-0005

For the reasons next explained, OAR 471-060-0005

exceeds the scope of its authorizing statute, ORS 183.645,

because it does not contain discernable, predictable time

limitations, sufficient to provide a party the opportunity to

identify when a request must be submitted. Therefore, OAR

471-060-0005 is inconsistent with ORS 183.645 and accord-

ingly, invalid as written.

OAR 471-060-0005(3) provides that “[e]very party

and agency in a contested case is entitled to request a change

of administrative law judge,” and that the first such request

“shall be automatically granted.” Subsection (3) then is mod-

ified by subsection (4), which provides, in relevant part:

“Notwithstanding section (3), no request shall be

granted if a party or agency had a reasonable opportunity

to request a change of administrative law judge but did

not do so. ‘Reasonable opportunity’ is determined under the

totality of circumstances.”

(Emphases added.)

The text of OAR 471-060-0005(4) uses past-tense

phrasing to describe the time for making a request for a

different ALJ. Thus, under that subsection, whether a party

“had” a reasonable opportunity to request a change of ALJ

but “did not” do so is a determination that can be made

only after the chief ALJ receives the request. That is incon-

sistent with ORS 183.645 because the act of submitting

a request can be evaluated from only a backward-looking

posture—which means that a party or agency cannot iden-

tify in advance the time period for submitting a request. A

party apparently can only wait and see whether the chief

ALJ concludes that a request was timely and cannot discern

at the outset any specific time period to request a different

ALJ.

Cite as 366 Or 612 (2020) 625

By providing that the timeliness of a request will

be evaluated in hindsight by the chief ALJ, the text of OAR

471-060-0005(4) fails to establish “by rule” a time limitation

“for requests” as ORS 183.645 envisions, because the rule

appears to impose no “limitation” on the requestor. The only

restriction that we can identify is not found in the rule, but

rather, it is one imposed by the chief ALJ after a request has

been submitted. Thus, the time period for making a first

request is indefinite. As discussed earlier, though, an unde-

fined or indefinite period of time for making a request is

not a proper “limitation” on a time period, because there is

no “restraint” or “restriction” marking the moment that the

subject act must conclude.

Finally, under OAR 471-060-0005(4), a party’s “rea-

sonable opportunity” to object to an ALJ assignment is eval-

uated “under the totality of the circumstances in each case.”

Yet neither the rule nor ORS 183.645 require a first request

to allege any “circumstances.” It follows that, when the

chief ALJ receives the written request, it contains only the

request for a different ALJ. Therefore, whatever “circum-

stances” the chief ALJ evaluates to determine whether the

request was timely can be known to only the chief ALJ, and

not a party making a request. An evaluation of factual cir-

cumstances on an ad hoc basis does not constitute a specific

period of time for a party to submit a request for a differ-

ent ALJ and is inconsistent with the meaning of “time lim-

itations” in ORS 183.645. For all those reasons, OAR 471-

060-0005 “exceeds the statutory authority” of the agency

and is therefore invalid. ORS 183.400(4)(b). See Planned

Parenthood, 297 Or at 573.

D. Whether the Fairness of the Proceedings was Impaired

The board presented one additional argument in

support of affirmance, even if we conclude that OAR 471-

060-0005 is invalid: licensee failed to argue that the chief

ALJ’s decision denying her request impaired the fairness of

the proceedings. That argument is based on ORS 183.482(7),

which provides, in part:

“* * * The court shall remand the order for further

agency action if the court finds that either the fairness of

626 Pulito v. Board of Nursing

the proceedings or the correctness of the action may have

been impaired by a material error in procedure.”

ORS 183.482(7) is one of several statutes in the APA

that govern judicial review of final orders. Unlike the board,

we do not read that provision to require licensee to demon-

strate that the fairness of the proceedings was impaired.

Rather, ORS 183.482(7) guides a reviewing court in deter-

mining the appropriate remedy where the fairness of the

proceedings “may have been impaired by a material error in

procedure.” (Emphasis added.)

The chief ALJ’s denial of licensee’s request for a dif-

ferent ALJ was error, because that denial was based upon

an administrative rule that is invalid for being inconsistent

with its implementing statute. We conclude that the chief

ALJ’s denial “may have impaired the fairness of the pro-

ceedings” (emphasis added) as ORS 183.482(7) provides,

such that it is appropriate to remand the board’s final order.

Additionally, this court may determine the validity

of a rule “upon review of an order in any manner provided

by law.” ORS 183.400(2). The APA expressly authorizes a

court reviewing a final order for error of law to “reverse

or remand” the order. ORS 183.482(8)(a). If an agency has

acted under an erroneous interpretation of law and the cor-

rect interpretation compels a particular action, the APA

requires the court to set aside or modify an agency’s order

or remand the case. ORS 183.482(8)(a)(A) - (B). Acting under

an erroneous interpretation of law includes instances where

an agency’s final order assumes the validity of and relies on

a rule that a reviewing court determines is invalid. England

v. Thunderbird, 315 Or 633, 639, 848 P2d 100 (1993).

Licensee had argued at each stage in the contested

case before the board that a correct interpretation of “time

limitations” in ORS 183.645 was a specific time period and

that, because OAR 471-060-0005 failed to provide a specific

time period, it was invalid. Licensee urged the board to con-

clude that, in relying on OAR 471-060-0005, an invalid rule,

the chief ALJ erred as a matter of law, and that as a result,

the proposed order written by the assigned ALJ was also

improperly before the board. We agree with licensee that

the board should have reached such a conclusion, as it is

Cite as 366 Or 612 (2020) 627

the “particular action” that a correct interpretation of ORS

183.645 would compel. ORS 183.482(8)(a). Instead, the board

acted by issuing a final order that adopted the assigned

ALJ’s statement—set out in that ALJ’s proposed order that

the board later adopted in its final order—that licensee’s

request for a different ALJ had been denied as “untimely”

under ORS 183.645 and OAR 471-060-0005. Because the

final order of the board assumed and relied upon the valid-

ity of OAR 471-060-0005 in adopting the assigned ALJ’s

statement, the board acted upon an erroneous interpreta-

tion of law. See England, 315 Or at 639. Its decision was thus

erroneous, and we may reverse the board’s final order on

those grounds. ORS 183.842(8)(a).

III. CONCLUSION

To summarize, we conclude from our examination

of the text and context of ORS 183.645 that the legislature

intended the term “time limitations” to mean an objectively

identifiable time period—one that is discernable by an indi-

vidual party at the outset, so that a party may know what

is required to submit a timely request for a different ALJ,

without the added burden of showing good cause. OAR 471-

060-0005 is inconsistent with both the wording of that stat-

ute and its underlying legislative policy.

It follows that the final order of the board must be

reversed, because the fairness of the proceedings may have

been impaired when the chief ALJ relied on an invalid rule

to deny licensee’s request for a different ALJ, and because

the board acted under an erroneous interpretation of law

when it issued a final order that assumed the validity of that

rule. As our holding implies, though the legislature autho-

rizes an agency to interpret a statute by rule, such authority

is not an unlimited delegation. A rule must be consistent

with the legislative policy of the implementing statute. See

Planned Parenthood, 297 Or at 573.

The decision of the Court of Appeals is reversed.

The final order of the Oregon State Board of Nursing is

reversed, and the case is remanded to the board for further

proceedings.