Preview: United States v. Home Concrete & Supply, LLC: Making “Ambiguous” Ambiguous

W. Matthew Pierce[1]

Though Americans argue about what size our government should be, few debate what size our government is—large and complex. As statutory law developed, government agencies were created and expanded to administer different portions of the ever-growing body of law. Our government today is comprised of dozens of agencies, each tasked with administering some cumbersome area of law.

This development presents a wrinkle in the classic conception of the roles of the branches of our government: the legislative branch makes the law, the executive branch enforces the law, and the judicial branch interprets the law. The agencies are theoretically part of the executive branch, delegated by the president to enforce a particular body of law. But Congress, too, needs to delegate some of its legislative tasks to agencies in matters requiring too much time, expertise, and details. Thus, when addressing areas of law administered by agencies, Congress may write more skeletal statutes, leaving the administering agencies to fill in the details in a pseudo-legislative role.

The judiciary has struggled with how to deal with agency interpretations in such situations. Should it defer to the agency as it would defer to congress, considering that Congress has apparently delegated lawmaking authority? Or should it ignore the apparent legislative delegation and interpret the statutes directly, trumping agency interpretations and deferring only to Congress?

More than twenty years after the landmark Chevron, U.S.A., Inc. v. National Resource Defense Council, Inc. case of 1984, many open questions remained about when the judiciary should defer to agency interpretations of agency-administered law. In 2012, the Supreme Court took the issue up again in United States v. Home Concrete, LLC, in which a plurality sought to refine further Chevron’s standard that courts should defer to an agency when an agency-administered statute is ambiguous and the agency interpretation is reasonable.

Home Concrete involved a provision of the tax code, of which one interpretation favored the I.R.S. and another interpretation favored the taxpayer. The Supreme Court had ruled in favor of the taxpayer interpretation in 1954 in Colony, Inc. v. Commissioner, but since the writing of the statute interpreted in Colony, Congress revised the statute and the Treasury Department codified the pro-I.R.S. interpretation. On its face, Home Concrete was decided on the narrow issue of whether or not Congress’s revisions made the statute different than the version interpreted by the Supreme Court in Colony. A plurality led by Justice Breyer, however, went on to explain that the Treasury Department could not provide its own interpretation because the Colony Court had determined congressional intent to be unambiguous, thus failing Chevron’s first step.

Rather than presume ambiguity absent an affirmative finding that Congress clearly expressed its intent on the issue, the Home Concrete plurality presumed clarity absent an affirmative finding that Congress “left a gap to fill.” This reversal of Chevron’s presumption of ambiguity represents a departure from the deferential policy established by Chevron and suggests a difficult standard for courts to follow and for potential litigants to predict.

The introduction of this new uncertainty will result in an increase in litigation with a decrease in predictability. The uncertainty will be accompanied by a general trend away from deference to agencies and towards burdening courts with complicated policy-laden statutory interpretation. The extent of these effects will depend on the weight given by lower courts to the plurality’s guidance. What is clear is that administrative deference law will remain confused until the Supreme Court takes the issue up again and draws more legible lines.

For more background and analysis of the case and its effects, see W. Matthew Pierce, United States v. Home Concrete & Supply, LLC: Making “Ambiguous” Ambiguous, 90 Den. U. L. Rev. ___ (forthcoming 2013).


[1] J.D. Candidate, 2014, University of Denver Sturm College of Law