Barbara Gilder v. Lionel R. Meno, Commissioner of Education for the State of Texas and Central Education Agency And Aquilla Independent School District

• Court: Court of Appeals of Texas
• Decided: June 26, 1996
• Docket: 03-95-00080-CV
• Status: Published

Opinion

Gilder v. Meno TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-95-00080-CV

Barbara Gilder, Appellant

v.

Lionel R. Meno, Commissioner of Education for the State of Texas and Central

Education Agency; and Aquilla Independent School District, Appellees

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 98TH JUDICIAL DISTRICT

NO. 455,464, HONORABLE MARY PEARL WILLIAMS, JUDGE PRESIDING

DISSENTING OPINION

I respectfully dissent.

This is, at its core, a statutory-construction case. There are two simple propositions that control the outcome of this appeal. First, more than a half-century of case law requires that "inter-agency appeals" to the Commissioner of Education be conducted with a new evidentiary hearing. Second, when it was enacted in 1981, the Term Contract Nonrenewal Act ("TCNA") did not alter that requirement.

FACTUAL AND PROCEDURAL BACKGROUND

The majority's statement of the factual and procedural background is essentially correct. Gilder was employed by Aquilla Independent School District ("AISD") as a special education teacher under a one-year term contract for the 1984-85 school year. After AISD sent Gilder a "notice of proposed nonrenewal," she properly requested a hearing before the board. Following a hearing, the board voted unanimously to nonrenew Gilder's contract. Gilder filed a petition for review with the Commissioner alleging that the board's decision was arbitrary, capricious, unlawful, and not supported by substantial evidence; she later filed a motion expressly requesting an evidentiary hearing, at least in part to develop evidence of bias and retaliation.

The Commissioner's rules for reviewing TCNA decisions of local school boards permit a teacher to present evidence to the Commissioner only in very limited circumstances:

All allegations by the teacher that the decision of the board of trustees was arbitrary, capricious, unlawful, or not supported by substantial evidence shall be resolved by a review of the record of appeal; however, on the motion of either party, the commissioner of education may order that additional evidence be taken to supplement the transcript if it appears that such party has evidence to offer which is material, relevant, and not unduly repetitious, which that party, for good cause, was unable to adduce at the local hearing.

8 Tex. Reg. 2756, 2759 (1983) (emphasis added) (formerly 19 Tex. Admin. Code § 157.64(b), repealed by 18 Tex. Reg. 1928 (1993); current version found at 19 T.A.C. § 157.1071 (West 1995)).

Concluding that Gilder had failed to satisfy the "good cause" requirement of rule 157.64(b), the Commissioner denied her request for an evidentiary hearing, permitting her only to file a written brief in support of her petition. After conducting a review based exclusively on the record made before the AISD board, the Commissioner denied the appeal and held that the board's decision was supported by substantial evidence and was not arbitrary, capricious, or unlawful. Gilder filed the present suit for judicial review of the Commissioner's order. The district court affirmed.

TYPES OF REVIEW OF AGENCY ACTION

Texas has recognized four types of review of agency action: (1) pure trial de novo, (2) pure substantial evidence, (3) substantial evidence de novo, and (4) a special rate-case classification referred to as "de novo fact trial." See Board of Trustees of the Big Spring Fireman's Relief & Retirement Fund v. Firemen's Pension Comm'r, 808 S.W.2d 608, 611 (Tex. App.Austin 1991, no writ); see also James R. Eissinger, Judicial Review of Findings of Fact in Contested Cases Under APTRA, 42 Baylor L. Rev. 1, 11 (1990). The last type of review listed above does not apply to a proceeding such as the present one.

Under a "pure trial de novo" review, the decision of the lower agency or board is automatically vacated upon the taking of an appeal, and the reviewing tribunal not only hears new evidence, but also substitutes its discretion and judgment for that of the lower body. This type of review is technically not an "appeal" at all, but a new proceeding. See Central Educ. Agency v. Upshur County Comm'rs Court, 731 S.W.2d 559, 561 (Tex. 1987).

Under a "pure substantial evidence" review, the reviewing tribunal looks only at the record made before the fact-finding body, i.e., the agency or board, to determine whether that body's findings are reasonably supported by substantial evidence. Imperial Am. Resources Fund, Inc. v. Railroad Comm'n, 557 S.W.2d 280, 285 (Tex. 1977).

Under a "substantial evidence de novo" review, the reviewing tribunal likewise seeks to determine whether the findings made by the local agency or board are reasonably supported by substantial evidence and are otherwise lawful. The reviewing tribunal is not, however, confined to the record made below; rather, it receives evidence at a new hearing and, from that body of evidence, determines as a question of law whether the findings of the agency or board are lawful and supported by substantial evidence. See Firemen's & Policemen's Civ. Serv. v. Brinkmeyer, 662 S.W.2d 953, 956 (Tex. 1984); Big Spring, 808 S.W.2d at 612. "[T]he reviewing tribunal conducts an evidentiary hearing for the limited purpose of determining `whether at the time the questioned order was entered there then existed sufficient facts to justify the agency's order.'" Big Spring, 808 S.W.2d at 612 (quoting Gerst v. Nixon, 411 S.W.2d 350, 354 (Tex. 1966)). In determining whether the fact-finder's decision is reasonably supported by substantial evidence and is otherwise lawful, the reviewing tribunal considers only the evidence introduced at the review hearing, which may or may not include the administrative record, if any, made by the agency or local board. Big Spring, 808 S.W.2d at 612; see generally Railroad Comm'n v. Shell Oil Co., 161 S.W.2d 1022 (Tex. 1942); Trapp v. Shell Oil Co., 198 S.W.2d 424 (Tex. 1946); Thomas M. Reavley, Substantial Evidence and Insubstantial Review In Texas, 23 Sw. L.J. 239, 241-43 (1969). Thus, despite the introduction of new evidence at the review hearing, the inquiry in a substantial-evidence-de-novo review is purely a question of law, and the proceeding is truly an "appeal." See Brinkmeyer, 662 S.W.2d at 956. Consequently, the reviewing tribunal may not substitute its judgment for that of the agency on controverted issues of fact. Texas State Bd. of Dental Examiners v. Sizemore, 759 S.W.2d 114, 116 (Tex. 1988); Brinkmeyer, 662 S.W.2d at 956. The decision of the fact-finding body has a presumption of validity, and the party seeking to set aside that body's decision has the burden of showing that at the time of the original proceeding substantial evidence did not exist to support the previous decision. Mercer v. Ross, 701 S.W.2d 830, 831 (Tex. 1986). Whatever its flaws, substantial evidence de novo was the prevailing method of judicial review in this state from the 1930's until the enactment of the APA in 1975.

To fully appreciate the distinction between the various types of administrative review, it is necessary to understand three different aspects of the review of agency decisions:

Over the years in Texas, the terms "trial de novo" and "substantial evidence rule" have been applied primarily to three aspects of judicial review of administrative agency decisions. First, does the filing of an appeal from an agency decision automatically vacate the agency order or does the order continue in effect unless otherwise stayed or vacated? Second, does the reviewing court review the agency decision on the record compiled before the agency or does it take evidence "anew" in court? Third, does the reviewing court or trier of fact substitute its discretion "anew" in lieu of the agency's determination on questions of fact committed to agency discretion by the Legislature, or does it sustain those determinations if reasonably supported by substantial evidence?

Dudley D. McCalla, The Administrative Procedure and Texas Register Act, 28 Baylor L. Rev. 445, 464-65 (1976). Thus, the types of administrative review discussed above are distinguished precisely by their different treatment of these three aspects of review. A review wherein the agency's decision is automatically vacated, new evidence is taken, and the reviewing body substitutes its discretion for that of the agency is pure-de-novo review. At the opposite end of the spectrum, a review wherein the agency's decision is not automatically vacated, the reviewing body looks only at the agency record, and the agency's decision is upheld if supported by substantial evidence is pure-substantial-evidence review. Texas's unique creation, substantial-evidence-de-novo review, is a hybrid: it resembles pure-substantial-evidence review in that the agency's decision is not automatically vacated and is upheld if supported by substantial evidence; it resembles pure-de-novo review in that new evidence is heard by the reviewing body.

For our purposes, the second and third aspects of review identified by Mr. McCalla are the important ones. The second aspect is essentially procedural, referring simply to whether new evidence is heard and used by the reviewing body. The third aspect, on the other hand, relates to the standard by which the reviewing body determines whether the lower agency decision should be upheld. This standard is the same irrespective of which procedure is used, i.e., whether the reviewing body hears new evidence, as in substantial-evidence-de-novo review, or looks only at the record compiled before the lower agency, as in pure-substantial-evidence review. As Mr. McCalla explains in a later article, "The term `substantial evidence' has nothing to do with the first [vacation of decision] and second [new evidence] aspects of judicial review; it refers to the quantum of evidence necessary to sustain an agency order or finding. The more accurate terminology is the substantial evidence `test.'" Dudley D. McCalla, Judicial Review of Agency Orders, in State Bar of Texas, Advanced Administrative Law Course Manual U, U-2 (1990).

The Commissioner's rule at issue here requires that, except in extraordinary circumstances, the review of a TCNA decision of a local school board "shall be resolved by a review of the record of appeal." By its terms and by the way the Commissioner applied it in this case, the rule imposes a pure-substantial-evidence review on TCNA appeals to the Commissioner.

INTER-AGENCY REVIEW BEFORE THE TCNA

The types of review discussed above are used regardless of whether the reviewing body is a court or a higher agency. Accordingly, the general rules hammered out over the years by courts for conducting judicial review of agency orders provide a helpful analogy in determining how inter-agency appeals should be carried out.

Before the APA was enacted in 1975, review of agency decisions "on the record" was essentially unheard of in Texas. ⁽¹⁾ Judicial review of agency decisions in Texas was generally conducted by the substantial-evidence-de-novo method. See Reavley, supra, at 239-41. As will be discussed below, most if not all inter-agency appeals were conducted by a pure-de-novo review. Enacted by the legislature in 1975 and effective January 1, 1976, the Administrative Procedure Act ("APA") ⁽²⁾ mandated a pure-substantial-evidence review for judicial review of those agency decisions coming within the purview of the Act. See APA § 2001.174, .175. Not all agencies, however, come within the purview of the Act. For example, in 1981, the legislature expressly removed decisions of the Texas Employment Commission from the reach of the APA. See Act of April 16, 1981, 67th Leg., R.S., ch. 76, § 2, 1981 Tex. Gen. Laws 168, 168 (Tex. Rev. Civ. Stat. Ann. art. 6252-13a, § 21(g), since repealed and codified at Tex. Gov't Code Ann. § 2001.224 (West Pamph. 1996)).

Regarding judicial review of administrative decisions to which the APA does not apply, Texas courts have consistently held that the proper approach is to revert to the pre-APA substantial-evidence-de-novo review. See West Gulf Maritime Ass'n v. Sabine Pilots Ass'n, 617 S.W.2d 744, 747 (Tex. Civ. App.Beaumont 1981, writ ref'd n.r.e.); Texas Employment Comm'n v. City of Houston, 616 S.W.2d 255, 258-59 (Tex. Civ. App.Houston [1st Dist.]), writ ref'd n.r.e. per curiam, 618 S.W.2d 329 (Tex. 1981); see also Mercer, 701 S.W.2d at 831; Brinkmeyer, 662 S.W.2d at 955-56; City of Harlingen v. Lucio, 770 S.W.2d 7, 8 (Tex. App.Corpus Christi 1989, writ denied); Valentino v. City of Houston, 674 S.W.2d 813, 816 (Tex. Civ. App.Houston [1st Dist.] 1984, writ ref'd n.r.e.); Instant Photo, Inc. v. Texas Employment Comm'n, 650 S.W.2d 196, 197-98 (Tex. App.San Antonio 1983, no writ); City of San Antonio v. Flores, 619 S.W.2d 601, 602 (Tex. Civ. App.Houston [14th Dist.] 1981, writ ref'd n.r.e.). Commentators and administrative law practitioners have agreed. See Eissinger, supra, at 11-13; W. Wendall Hall, Standards of Appellate Review in Civil Cases, 21 St. Mary's L.J. 865, 929 (1990); Robert W. Hamilton & J.J. Jewett, III, The Administrative Procedure and Texas Register Act: Contested Cases and Judicial Review, 54 Tex. L. Rev. 285, 311 (1976); see also L. Kirk Kridner, Scope of Judicial Review of Agency Decisions In Contested Cases, in State Bar of Texas, Advanced Administrative Law Course Manual T, T-6 (1992); Dudley D. McCalla, Judicial Review of Agency Orders, in State Bar of Texas, Advanced Administrative Law Course Manual U, U-11 (1990); Larry E. Temple, Judicial ReviewA Review of the Substantial Evidence Rule and Trial De Novo, in State Bar of Texas, Advanced Administrative Law Course Manual Q, Q-10 (1989).

Because a local school board does not have statewide jurisdiction, it is not an "agency" for purposes of the APA. See Big Spring, 808 S.W.2d at 611; West Gulf Maritime,

617 S.W.2d at 747. Accordingly, the APA provisions governing review of agency decisions do not apply when the Commissioner is reviewing the decision of a local school board. Id. Thus, as with non-APA judicial review, logic dictates that inter-agency review should continue to be conducted by the rules in place before the enactment of the APA. As a practical matter, this means that the standard and procedure to be used in an inter-agency appeal are determined by the substantive statutes related to the relevant agency. Cf. Michael J. Tomsu, Judicial Review of Administrative Decisions in Contested Cases, in State Bar of Texas, Advanced Administrative Law Course Manual S, S-8 (1994).

As a general proposition, Texas courts have long held that "[t]he substantial evidence rule applies to appeals taken from an administrative agency to the courts, and not to appeals from lower to higher administrative agencies." See Lorena Indep. Sch. Dist. v. Rosenthal Common Sch. Dist., 421 S.W.2d 491, 493 (Tex. Civ. App.Waco 1967, writ ref'd n.r.e.); accord Temple Indep. Sch. Dist. v. State Bd. of Educ., 493 S.W.2d 543, 544 (Tex. Civ. App.Austin 1973, no writ). The reference to the "substantial evidence rule" in such statements is clearly to the third aspect of administrative review, i.e., whether the reviewing body substitutes its judgment for that of the lower agency or board. Thus, it appears that inter-agency appeals were generally conducted by a pure-de-novo review, i.e., the decision of the lower agency was effectively vacated by the appeal, and the higher agency heard new evidence and substituted its findings and judgment for that of the lower agency.

With that proposition as a backdrop, it is necessary to review the statutes relevant to Gilder's inter-agency appeal. The general statutory authorization for appeals to the Commissioner from decisions of local school boards is contained in former section 11.13(a) of the Education Code:

[A]ny person aggrieved by the school laws of Texas or by actions or decisions of any board of trustees or board of education may appeal in writing to the commissioner of education, who, after due notice to the parties interested, shall hold a hearing and render a decision . . . .

Tex. Educ. Code, 61st Leg., R.S., ch. 889, sec. 1, § 11.13(a), 1969 Tex. Gen. Laws 2735, 2757 (Tex. Educ. Code Ann. § 11.13(a), since repealed and recodified at Tex. Educ. Code Ann. § 7.057 (West 1996)).

Section 11.13(a) does not specify the type of hearing the Commissioner must provide or the nature of review the Commissioner is to conduct. The predecessor to section 11.13(a) was first enacted in 1949. See Act of May 3, 1949, 51st Leg., R.S., ch. 299, Art. VII, Sec. 1, 1949 Tex. Gen. Laws 537, 545 (Tex. Rev. Civ. Stat. Ann. art. 2654-7, § 1, since repealed and now codified at Tex. Educ. Code Ann. § 7.057 (West 1996)). As early as the 1950's, the Commissioner promulgated policies and procedures that required a trial-type evidentiary hearing in appeals from decisions of local school boards. See Handbook for Local School Officials, Bulletin 603, Texas Education Agency, September 1959, Chapter XVIII ("Hearings & Appeals"), pp. 158-64. Even after the 1975 enactment of the APA, the Central Education Agency adopted formal rules that maintained the requirement that appeals to the Commissioner from actions or decisions of lower boards or officials be resolved after an evidentiary hearing. See 1 Tex. Reg. 1050, 1053-56 (1976). Appeals from the Commissioner to the State Board of Education, on the other hand, were to be conducted "on the record, briefs and oral argument only." See 1 Tex. Reg. 1056, 1057 (1976).

In 1987, the supreme court held in a non-TCNA appeal that the Commissioner's review of a school-related decision of a county commissioners court should be a substantial-evidence-de-novo review. See Upshur County, 731 S.W.2d at 562. The members of the supreme court were all in agreement that a de novo procedure should be used. The disagreement revolved around the standard to be applied by the Commissioner: the majority favored substantial evidence de novo (i.e., giving deference to the county commissioners' findings and decision), while the dissenters favored pure de novo (i.e., no deference). The only mention of substantial-evidence review "on the record" was a cursory disapproval of that form of review in appeals to the Commissioner. See id. at 562 n.2 ("the Commissioner [is] not so limited").

There is no question about the type of review ordered in Upshur County. The supreme court stated that in reviewing a school-related decision of a county commissioners court under section 11.13(a), the Commissioner is to conduct an evidentiary hearing "solely for the purpose of determining whether there was fraud, bad faith or an abuse of discretion in the decision of the county commissioners and whether their decision is supported by substantial evidence." Id. at 562. The court described the review to be conducted by the Commissioner as "akin to the substantial evidence trial de novo." Id. at 562 n.2. Recently, the supreme court was even more definite in its description, stating that Upshur County interpreted section 11.13(a) as requiring the Commissioner to conduct "a substantial evidence de novo administrative hearing." Nueces Canyon Consol. Indep. Sch. Dist. v. Central Educ. Agency, 917 S.W.2d 773, 776 (Tex. 1996).

Thus, outside the TCNA, the Commissioner has traditionally used and is required to use a de novo hearing procedure (either pure de novo or substantial evidence de novo) in reviewing school-related decisions of local boards and agencies. The dispositive issue in the present case, therefore, is whether the TCNA, as enacted in 1981, mandated a new, pure-substantial-evidence procedure for inter-agency appeals taken under that statute.

DID THE TCNA REQUIRE A DIFFERENT PROCEDURE?

The TCNA itself contains an express provision bearing on teacher appeals from decisions of local school boards. Former section 21.207(a) of the Education Code provides:

If the teacher is aggrieved by the decision of the board of trustees, he may appeal to the State Commissioner of Education pursuant to Section 11.13 of this code. The commissioner may not substitute his judgment for that of the board of trustees, unless the decision below was arbitrary, capricious, unlawful, or not supported by substantial evidence.

Term Contract Nonrenewal Act, 67th Leg., R.S., ch. 765, sec. 2, § 21.207, 1981 Tex. Gen. Laws 2847, 2848 (Tex. Educ. Code Ann. § 21.207(a), since repealed and recodified in amended form at Tex. Educ. Code Ann. § 21.209(a) (West 1996)).

The first sentence of section 21.207(a) simply invokes section 11.13 of the Education Code, so under the holding of Upshur County it obviously does not require a pure-substantial-evidence review.

The majority focus, therefore, on the second sentence of section 21.207(a) as the sole statutory support for their conclusion that the TCNA mandates a pure-substantial-evidence review by the Commissioner. The majority's reliance is misplaced. Although the second sentence of section 21.207(a) clearly requires a "substantial evidence" standard or test, that alone is no indication whatsoever that the legislature intended the commissioner's review to be restricted to the local school board record. As discussed above, both pure-substantial-evidence review and substantial-evidence-de-novo review utilize a substantial-evidence test. But section 21.207(a) does not address the question of procedure, which is the critical distinction between the two types of review: From what body of evidence is the review to be made, the record made before the local board or a new record made before the Commissioner? Thus, the second sentence of section 21.207(a) is completely consistent with the substantial-evidence-de-novo review held by the supreme court in Upshur County to be mandated by section 11.13(a). Only by ignoring the distinction between the standard to be applied and the procedure to be used can the majority read the second sentence of section 21.207(a) as requiring a pure-substantial-evidence review.

In addition, courts are obliged to construe statutory language in the context of the statute as a whole rather than as an isolated provision. Bridgestone/Firestone, Inc. v. Glyn-Jones, 878 S.W.2d 132, 133 (Tex. 1994). In the present case, an examination of the other relevant provisions of the TCNA confirms that the legislature cannot have intended to require a pure-substantial-evidence review by the Commissioner. The hearing procedures to be used by local school boards are contained in former sections 21.205 and 21.206 of the Education Code:

§ 21.205. Hearing

(a) If the teacher desires a hearing after receiving notice of the proposed nonrenewal, the teacher shall notify the board of trustees in writing within 10 days after receiving the notice of nonrenewal. The board shall provide for a hearing to be held within 15 days after receiving written notice from the teacher requesting a hearing. Such hearing shall be closed unless an open hearing is requested by the employee.

(b) The hearing shall be conducted in accordance with rules promulgated by the district.

§ 21.206. Decision of Board

(a) If the teacher fails to request a hearing, the board shall take such action as it deems lawful and appropriate and shall notify the employee in writing of that action within 15 days of the expiration of the 10-day period for requesting a hearing.

(b) If the teacher requests a hearing, the board shall take such action as it deems lawful and appropriate and shall notify the teacher in writing of that action within 15 days following the conclusion of the hearing.

Term Contract Nonrenewal Act, 67th Leg., R.S., ch. 765, sec. 2, §§ 21.205, .206, 1981 Tex. Gen. Laws 2847, 2848 (Tex. Educ. Code Ann. §§ 21.205, .206, since repealed and recodified in amended form at Tex. Educ. Code Ann. §§ 21.207, .208 (West 1996)).

Thus, the first circumstance to be considered is that unless the teacher expressly requests it, the local school board need not hold a hearing at all. Nor does the statute require that any hearing be recorded. Without a recorded hearing, there would be no record for the Commissioner to review. Yet an aggrieved teacher's right to appeal to the Commissioner may not be conditioned on having requested and participated in a hearing before the local board. Havner v. Meno, 867 S.W.2d 130, 133-34 (Tex. App.Austin 1993, no writ). The majority do not explain how the Commissioner would conduct a pure-substantial-evidence review in the absence of a local record.

Other circumstances are also significant. Section 21.205 provides that, unless the teacher expressly requests an open hearing, any hearing held "shall be closed"; moreover, any such hearing must be conducted "in accordance with rules promulgated by the district," with no minimum requirements for what those rules should provide. Thus, even if a hearing of some sort were provided, gaps in the TCNA would create a substantial risk that the teacher would not be afforded an opportunity to make a full and complete record for the Commissioner to review. Indeed, even the most fair-minded district could not assure a full and complete record, because local school districts do not have subpoena power and so cannot guarantee the presence of crucial witnesses and documents.

In short, not only is the statutory language of the TCNA consistent with a substantial-evidence-de-novo review, the statutory scheme created by the TCNA is wholly inconsistent with a review limited to the record of the local school board. ⁽³⁾

The cornerstone of the majority's analysis is the fact that the TCNA used language, similar to terms used in the APA just six years earlier, requiring that the Commissioner's review must be a "substantial evidence" review. From that, they conclude that the legislature must have intended that an inter-agency review under the TCNA be conducted using the same procedure required for judicial review under the APA. In so concluding, however, the majority again ignore the crucial distinction between the standard to be applied and the procedure to be used. In the APA, the legislature placed the standard to be applied and the procedure to be used in separate provisions. See Administrative Procedure and Texas Register Act, 64th Leg., R.S., ch. 61, § 19(d), (e), 1975 Tex. Gen. Laws 136, 147 (Tex. Rev. Civ. Stat. Ann. § 19(d), (e), since repealed and recodified at Tex. Gov't Code Ann. §§ 2001.174, .175(e) (West Pamph. 1996)). Indeed, because the review standard is the same for both substantial evidence de novo and pure substantial evidence, the true innovation in the APA was that it expressly changed Texas's historically used procedure.

The TCNA, on the other hand, specified the standard to be applied but made no mention whatsoever of a procedure to be used, even though the APA provided a perfect model of how to specify both the standard and the procedure. Thus, there is no support, logical or otherwise, for the majority's conclusion that the specification in the TCNA of the review standard implies a new and radically different procedure. In fact, just the opposite is true. Because the APA had so recently used language specifically mandating a new procedure in judicial review, it is clear the members of the legislature knew how to do so when they so desired. That they chose not to specify a particular procedure in the TCNA can only be construed as affirmatively indicating a desire not to change the existing procedure in such cases.

Finally, the majority argue that allowing a teacher appealing under the TCNA to present new evidence to the Commissioner "would transfer the real decision-making to the Commissioner at the state level." This statement reveals a fundamental misunderstanding of substantial-evidence-de-novo review. As discussed above, under substantial-evidence-de-novo review the agency order being reviewed is given precisely the same deference as in a pure-substantial-evidence review, i.e., it will be set aside only if it is arbitrary, capricious, unlawful, or not reasonably supported by substantial evidence in the record. Any teacher who hopes to "lay behind the log" at the school district level in order to present his or her best case to the Commissioner in a substantial-evidence-de-novo review is foolish indeed.

I would hold that the Commissioner, by following the procedure set forth in rule 157.64(b), used an incorrect review procedure and unreasonably restricted Gilder's right to a substantial-evidence-de-novo review of the AISD board's order. Accordingly, I would hold that the Commissioner acted in violation of sections 21.207(a) and 11.13(a) of the Education Code when he dismissed Gilder's appeal without allowing her to present evidence. I would reverse the judgment of the district court and render judgment that the cause be remanded to the Commissioner for the purpose of conducting a substantial-evidence-de-novo review of the AISD board's order.

J. Woodfin Jones, Justice

Before Chief Justice Carroll, Justices Jones and B. A. Smith

Filed: June 26, 1996

Publish

1.   The sole exception seems to have been judicial review under the Texas Savings and Loan Act, 58th Leg., R.S., ch. 113, sec. 1, § 11.12(5)(b), 1963 Tex. Gen. Laws 269, 299 (Tex. Rev. Civ. Stat. Ann. art. 852a, § 11.12(5)(b), since amended). See Gerst v. Nixon, 411 S.W.2d 350, 353-57 (Tex. 1966).

2.   Tex. Gov't Code Ann. §§ 2001.001-.902 (West Pamph. 1996). When this suit was instituted, the statutory provisions governing administrative procedures, including the review of agency orders, were contained in the Administrative Procedure and Texas Register Act (APTRA), 64th Leg., R.S., ch. 61, 1975 Tex. Gen. Laws 136. Because the subsequent recodification of APTRA into the APA did not substantively change the law, I refer to the APA for convenience. See Act of May 4, 1993, 73rd Leg., R.S., ch. 268, § 47, 1993 Tex. Gen. Laws 583, 986.

3.   Recent amendments to the TCNA again confirm the legislature's earlier intent. In 1995 the legislature amended the TCNA to add language expressly restricting the Commissioner's review in at least some appeals to "the local record." See Educ. Code §§ 21.209, .301(c) (West 1996). In conjunction with that change, however, the legislature also added extensive hearing procedures at the local board level. See Educ. Code §§ 21.251-.260 (West 1996). Among other things, the new provisions require the hearing to be conducted before a trained and certified hearing examiner who has the power to issue subpoenas for the attendance of witnesses and the production of documents, both for the hearing itself and for pre-hearing depositions and other means of discovery. The new provisions also require the hearing to be recorded by a certified shorthand reporter.

M>procedure.

The TCNA, on the other hand, specified the standard to be applied but made no mention whatsoever of a procedure to be used, even though the APA provided a perfect model of how to specify both the standard and the procedure. Thus, there is no support, logical or otherwise, for the majority's conclusion that the specification in the TCNA of the review standard implies a new and radically different procedure. In fact, just the opposite is true. Because the APA had so recently used language specifically mandating a new procedure in judicial review, it is clear the members of the legislature knew how to do so when they so desired. That they chose not to specify a particular procedure in the TCNA can only be construed as affirmatively indicating a desire not to change the existing procedure in such cases.

Finally, the majority argue that allowing a teacher appealing under the TCNA to present new evidence to the Commissioner "would transfer the real decision-making to the Commissioner at the state level." This statement reveals a fundamental misunderstanding of substantial-evidence-de-novo review. As discussed above, under substantial-evidence-de-novo review the agency order being reviewed is