Richard Cordray resigned as Director of the Consumer Financial Protection Bureau (CFPB) on Friday
evening. If Donald Trump did nothing to
try to replace Cordray temporarily, pending the President's appointment (and the Senate’s confirmation) of a new Director, then the CFPB's Deputy Director, Leandra English, would
serve as the interim, acting Director of the CFPB, pursuant to a provision of the
2010 Dodd-Frank Act, 12 USC § 5491(b)(5)(B), which provides that the
Deputy Director “shall . . . serve
as acting Director in the absence or unavailability of the Director.”
The President, however, has purported to appoint OMB
Director Mick Mulvaney to be the acting CFPB Director, pursuant to the 1998
Vacancies Reform Act (VRA). In an
opinion issued yesterday, the Office of Legal Counsel (OLC) concluded that
the VRA affords the President such authority, and that Dodd-Frank did not do
anything to affect that authority when it comes to the position of acting CFPB
Director. Others insist that Dodd-Frank
clearly overrides whatever authority the President might have had under the
VRA. Therefore, as it now stands, two officers may arrive at the CPGB office tomorrow morning, each claiming that they, alone, have a valid legal claim to the throne.
Notably, the only legal question that divides the parties, at this point, is whether the
VRA appointment procedures supersede the
Dodd-Frank section 5491 designation of the Deputy Director as acting Director in
cases where the President purports to act pursuant to the VRA. In this post, I’ll try to unpack the
arguments on that question.
The
Vacancies Reform Act provides that upon the resignation of a “PAS” officer
(that is, an officer, such as the CFPB Director, who is appointed by the
President by and with the advice and consent of the Senate), “the first
assistant to the office of such officer shall perform the functions and duties
of the office temporarily in an acting capacity subject to the time limitations
of section 3346.” 5 USC
The next paragraph of the VRA, however (5 USC § 3345(a)(2)), goes on to provide that “notwithstanding paragraph (1), the President (and only the President) may direct a person who serves in an office for which appointment is required to be made by the President, by and with the advice and consent of the Senate, to perform the functions and duties of the vacant office temporarily in an acting capacity subject to the time limitations of section 3346.” Mick Mulvaney is such a person—the Senate confirmed him to be OMB Director. And the President has now purported to appoint Mulvaney to be Acting Director of the CFPB, pursuant to section 3345(a)(2) of the VRA.
The next paragraph of the VRA, however (5 USC § 3345(a)(2)), goes on to provide that “notwithstanding paragraph (1), the President (and only the President) may direct a person who serves in an office for which appointment is required to be made by the President, by and with the advice and consent of the Senate, to perform the functions and duties of the vacant office temporarily in an acting capacity subject to the time limitations of section 3346.” Mick Mulvaney is such a person—the Senate confirmed him to be OMB Director. And the President has now purported to appoint Mulvaney to be Acting Director of the CFPB, pursuant to section 3345(a)(2) of the VRA.
The question of whether the Mulvaney appointment is legal
depends upon whether section 3345(a) of the VRA applies to an office in a case
where, as here, Congress has elsewhere—and in a statute postdating the
VRA—specifically designated who “shall” be the acting officer. And to answer that question, we must turn, at least in the first instance, to
section 3347 of the VRA. It provides in
pertinent part as follows:
§ 3347 Exclusivity
(a) Sections 3345 and 3346 are the exclusive means for
temporarily authorizing an acting official to perform the functions and duties
of any office of an Executive agency (including the Executive Office of the
President, and other than the General Accounting Office,) for which appointment
is required to be made by the President, by and with the advice and consent of
the Senate, unless
(1) a statutory provision expressly
(A) authorizes the President, a court, or the head of an Executive department to designate an officer or employee to perform the functions and duties of a specified office temporarily in an acting capacity; or
(B) designates an officer or employee to perform the
functions and duties of a specified office temporarily in an acting capacity;
or
(2) the President makes an appointment to fill a vacancy in
such office during the recess of the Senate pursuant to clause 3 of section 2
of article II of the United States Constitution.
Note that this
section, 3347, is not entitled “Application,” and it does not speak in terms of
when the VRA “applies.” (As I discuss
below, the original Senate bill in 1998 actually was entitled “Application,”
and spoke of when the VRA appointment provisions “are applicable.” That language was altered during the
legislative process in 1998.) Instead,
it speaks in terms of when the President’s appointment authorities under the
VRA are exclusive. And that’s the key to OLC’s analysis.
So, for example, OLC has previously opined that where
another statute provides a different mechanism by which an acting officer may be appointed, the two authorities
are complementary, i.e., the VRA provisions are no longer exclusive, but they
remain available to the President—the two provisions (the VRA and the relevant
agency statute) are alternative means
of filling the office temporarily. This
describes the cases that fall under paragraph 3347(a)(1)(A), where another
“statutory provision [apart from of the VRA] expressly . . . authorizes the President, a court, or
the head of an Executive department to designate an officer or employee to
perform the functions and duties of a specified office temporarily in an acting
capacity.” Thus, for example, OLC concluded in 2007 that
President Bush could use the VRA to appoint Peter Keisler, then head of the
Civil Division, to be acting Attorney General after Alberto Gonzales resigned,
notwithstanding a statute providing that the office of Attorney General is
vacant, the Deputy Attorney General “may
exercise all the duties of that office.”
That longstanding OLC reading of section 3347 as applied to paragraph
3347(a)(1)(A) cases is, I think, generally sound, as the U.S. Court of Appeals
for the Ninth Circuit confirmed in a 2016 case (see
page 11): If Congress has provided
in one statute that the President “may” fill an office in one way, and has
provided in another statute that he, or someone else, “may” fill that same
office in another way, Congress has provided two different options, either of
which is permissible, and neither of which is exclusive. (Of course, the later-in-time Congress can
provide that its procedure is exclusive, notwithstanding the language of
section 3347 of the VRA. That language,
however, establishes a background rule of construction against which the later
Congress acts, and there’s nothing in Dodd-Frank that would call the section
3347 presumption into question if this
were a case in which the latter statute provided a permissive means of filling the vacancy.)
The current CFPB dispute, however, raises the question of
how section 3347(a) applies in the next set
of cases described in VRA paragraph 3347(a)(1)(B), where another statutory provision “expressly . . . designates an officer or employee to
perform the functions and duties of a specified office temporarily in an acting
capacity.” That describes section
5491(b)(5)(B) of Dodd-Frank, in which the 2010 Congress itself designated the Deputy Director to be the
Acting Director, using mandatory, not permissive terms: That provision of Dodd-Frank does not provide
that the President or some other officer “may” appoint her to serve as Acting
Director, nor provide that she “may” so act, or even that she “shall” do so
pending a presidential appointment; instead, it provides, without more, that
the Deputy “shall serve as acting
Director.”
Importantly, OLC agrees
that, in such a case, the VRA procedures are certainly not the “exclusive”
means of choosing an Acting Director: The
statutory designation in Dodd-Frank can be
effective—indeed, it would be
effective, and thus Leandra English would be the undisputed acting CFPB
Director—if the President had not purported to appoint Mulvaney pursuant to the
VRA. (Some have argued that the
Dodd-Frank language in section 5491(b)(5)(B) does not cover a situation in
which the Director has resigned, but OLC reasonably concluded (see page 3 of
its opinion) that in such a case the Director is “unavailable,” and thus that
the provision is triggered.)
OLC argues, however, that the VRA continues to be available to
the President as an alternative means of filling the vacancy—a means that the
President employed here. Although, in
light of Dodd-Frank, the VRA might not be the “exclusive” means of naming an
acting CFPB Director, OLC concludes, it remains an alternative method, and therefore Mulvaney is now the acting
Director.
The fairly straightforward argument on the other side—and
it’s a fairly compelling one—is that the later-in-time Congress spoke
unequivocally in 2010, providing that the Deputy Director “shall serve” as
acting Director. Dodd-Frank does not say
that she “may” serve. It doesn’t even
say, as other statutes do, that she “shall serve” unless and until the
President appoints someone else to do so.[1] (And it certainly does not say—as the
House-passed version of version of the Consumer Financial Protection Act did
say—that the Vacancies Reform
Act governs the appointment of an acting Director in the case of a vacancy.)
In such cases of an unequivocal, mandatory statutory designation of the acting
officer, the argument goes, the President may not exercise his appointment
authority under the VRA, because Congress itself has already settled the
question of who serves. [UPDATE: I agree with Dan
Hemel that the use of “shall” does not necessarily
indicate a congressional intent that the Deputy Director would serve as acting
Director even in a case where the President preferred another, Senate-confirmed,
officer to do so. I do, however, think
that it establishes a presumption of such intent, and I’m not persuaded by Dan’s
first reason for rebutting that presumption.
His second reason, however—he’s “skeptical that Congress would have
wanted the CFPB to be headed indefinitely by an official who was not
presidentially appointed or Senate confirmed, without any statutory avenue for
the President to pick someone else”—warrants more attention, however. And more broadly, I think that if a court or anyone
else is going to answer this question, it would be very beneficial to have a
much greater understanding than I do about the nature of Congress’s intent in
2010, when it enacted the “shall serve” provision.] [UPDATE: As I discuss below, the Dodd-Frank provision would also be largely superfluous if its only function were to provide an alternative, rather than an exclusive, means of filling the vacancy, because that alternative was already present--indeed, it's the default rule--in section 3345(a)(1) of the Vacancies Reform Act.]
OLC addresses this argument—what is the effect on the VRA
procedures when a subsequent Congress specifically designates the officer who
“shall serve” as acting Director?—in a single paragraph of its opinion
yesterday, running over from page 5 to page 6.
It offers two arguments for why the VRA remains an alternative method of
filling a vacancy, even where a subsequently enacted statute provides that a
particular officer “shall serve” in the position on an acting basis. [UPDATE: By contrast, the opinion letter of the CFPB General Counsel, issued today, does not even address the crucial "shall serve" question.]
OLC’s first argument does not make sense, if I understand it
correctly. OLC notes that the VRA
“default” rule, in subsection 3345(a)(1), quoted above, “similarly uses
mandatory terms”; it provides that in the case of a vacancy “the first
assistant to the office of such officer shall
perform the functions and duties of the office temporarily in an acting
capacity subject to the time limitations of section 3346.” And, OLC notes—correctly—the President can
surely supersede that rule by making
an appointment pursuant to the next paragraph, section 3345(a)(2). “Accordingly,” OLC concludes, “we cannot view
either statute as more mandatory than the other. Rather they should be construed in
parallel.” In other words, because the
President can override the “shall perform” designation of section 3345(a)(1) of
the VRA, so, too, can he override the “shall serve” designation of the Deputy
Director in the later-enacted Dodd-Frank statute.
I must confess that I don’t get this argument. After all, the reason that subsection
3345(a)(2) of the VRA supersedes the default rule of subsection 3345(a)(1) in
cases where the President acts is that the latter paragraph expressly provides
that “notwithstanding paragraph (1), the President (and only
the President) may direct a person who serves in an office for which
appointment is required to be made by the President, by and with the advice and
consent of the Senate, to perform the functions and duties of the vacant office
temporarily in an acting capacity subject to the time limitations of section
3346.” That it to say, it is an express
carve-out from the mandatory language of
paragraph (1) of the VRA itself.
Section 3345(a)(2) does not say, however, that the President can use his
VRA appointment authority “notwithstanding paragraph (1) or the mandatory designation of an acting officer in any other statute.” Therefore I do not see the relevance of the
fact that subsection 3345(a)(2) of the VRA tempers the application of subsection
3345(a)(1) of that same statute—a fact that simply does not speak to the impact
of Congress’s designation in Dodd-Frank.
Therefore, OLC’s conclusion stands or falls on its second
argument, which depends entirely (and ironically, some might say, in light of
the general aversion to legislative history among many of those who support the
President’s authority here) on a reading of the 1998
Senate Report that preceded enactment of the VRA. As OLC notes, pages 16-17 of that Report
listed 40 then-existing statutes that prescribed some method of filling
vacancies in particular offices, and the Report noted that such authorities
would be “retain[ed]” by the Senate version of the VRA. Those 40 statutes included an array of
formulations, but were of three basic kinds: (i) some authorized the President, a court, or the head of an Executive
department, to designate an officer or employee to perform the functions and
duties of a specified office temporarily in an acting capacity; (ii) some (in
the words of the Report) “provide[d] for an automatic designation, unless the
President designates another official” (see, e.g., those I list in footnote 1
below); and (iii) at least five of them, listed in footnote 3 of yesterday’s
OLC opinion, were similar to the later CFPB statute, in that they simply
designated a particular officer or employee to perform the functions and duties
of a specified office temporarily in the case of a vacancy.
OLC states that in all
three of these categories of cases—including all 40 statutes cited in the
Report—“Congress plainly intended in those cases that the President could
invoke the Vacancies Reform Act as ‘an alternative procedure’ and depart from
the statutory order of succession” (quoting page 17 of the Senate Report). The only
authority OLC offers for this crucial gloss on section 3347 of the VRA,
however, is the source of its “an alternative procedure” quotation—namely, page
17 of the Senate Report itself. And
there are at least four reasons why that quotation from page 17 does not firmly
establish what OLC suggests it does.
First, it is, after all, merely a snippet from a committee
report—hardly the sort of thing that might authoritatively explain, or
inform—or even provide a background, defeasible interpretive rule for—what
Congress meant in 2010 when it provided, in no uncertain terms, that the Deputy
Director “shall serve” as acting Director.
Second, and as OLC expressly acknowledges (see p.5 of the
opinion), the Senate version of section 347 of the VRA, which was the subject
of the discussion in the Senate Report, was not ultimately enacted—the language
on which Congress ultimately settled is quite different.[2]
Third, OLC’s traditional reliance on the Senate Report to
support the general proposition that the VRA remains “available” as an
“alternative” means of filling vacancies, even where office-specific statute
prescribe other methods, depends upon the sentence in question on page 17 of
the Report (“[E]ven with respect to the specific positions in which temporary
officers may serve under the specific statutes this bill retains, the Vacancies Act would continue to provide
an alternative procedure for temporarily occupying the office.”)—and yet
that statement was obviously incorrect as
a reading of the language of 3347 that was in the Senate bill itself. That version of 3347 provided (see note 2
below) that the VRA provisions would be “applicable . . . unless” an existing statute provided a different mode of filling
the vacancy of a particular office: In
other words, if the Senate version had been enacted, the presidential
appointment authority under the VRA would
not have been “applicable” in such cases.
Therefore, the Report sentence in question is of dubious authority, even
on its own terms, and as applied to the (unenacted) bill it was
describing. (The only reason the VRA
continues to “apply” in any such
cases, then, is not because of the (flawed) Report language, but because
Congress ultimately enacted a different version of section 3347, one that
replaced the Senate’s “applicable unless” language with a statement about when
the VRA procedures are not to be “exclusive.”)
Fourth, and perhaps most importantly, OLC has selectively
quoted the relevant sentence on page 17 of the Senate Report. Recall OLC’s conclusion: that “Congress plainly intended in those
cases”—all of the different cases enumerated in the 40 statutes listed—“that
the President could invoke the Vacancies Reform Act as ‘an alternative procedure’ and depart from the statutory order of
succession.” The sentence on page 17,
however, refers specifically to the VRA remaining an “alternative procedure”
only “with respect to the specific positions in which temporary officers may serve under the specific statutes
this bill retains.” That sentence does
not make reference to the handful of statutes (OLC cites five of them) in which
Congress specifically designated an officer who “shall” (not “may”) serve in an acting capacity; and it certainly
did not establish a background presumption, against which future Congresses might understand they would be acting, that the Vacancies
Act would continue to provide an alternative procedure even where the
later-in-time legislature prescribed such a specific designated acting officer,
without any mention of the prospect of an alternative presidential appointment.
[UPDATE: I had meant to add another argument, flagged to me by my colleague Adam Levitin: If the only function of the Dodd-Frank provision for filling the vacancy in the office of Director were, as OLC concludes, to provide an alternative, rather than an exclusive, means of filling that vacancy, there'd have been no compelling reason for Congress to have enacted it, because that alternative--for the Deputy to take over the office temporarily-- was already present--indeed, it's the default rule--in section 3345(a)(1) of the Vacancies Reform Act itself. I think this is an interesting point, but doesn't resolve the question, because even though the VRA already provides for the prospect of the Deputy acting as Director, the Dodd-Frank provision would still have at least two further functions: (i) It would make her term indefinite, i.e., until a successor is confirmed, whereas the VRA designation is time-limited; and (ii) it also applies to cases where the Director remains in office but is otherwise "absent or unavailable," e.g., in the case of recusal or debilitating illness.]
[UPDATE: I had meant to add another argument, flagged to me by my colleague Adam Levitin: If the only function of the Dodd-Frank provision for filling the vacancy in the office of Director were, as OLC concludes, to provide an alternative, rather than an exclusive, means of filling that vacancy, there'd have been no compelling reason for Congress to have enacted it, because that alternative--for the Deputy to take over the office temporarily-- was already present--indeed, it's the default rule--in section 3345(a)(1) of the Vacancies Reform Act itself. I think this is an interesting point, but doesn't resolve the question, because even though the VRA already provides for the prospect of the Deputy acting as Director, the Dodd-Frank provision would still have at least two further functions: (i) It would make her term indefinite, i.e., until a successor is confirmed, whereas the VRA designation is time-limited; and (ii) it also applies to cases where the Director remains in office but is otherwise "absent or unavailable," e.g., in the case of recusal or debilitating illness.]
For these reasons, I think OLC’s conclusion about the
continued applicability of the VRA to later-enacted statutes, such as
Dodd-Frank, specifying a particular officer who “shall serve” in an acting
capacity, is at the very least contestable.
A reviewing court might agree
with it—but it might not. [UPDATE: I highly recommend Nina Mendelson's post, which offers further reasons--including, toward the end, some important functional considerations--that also point against the President's authority to appoint Mulvaney.]
As for how this whole contretemps
might end up in court any day now, see Sam
Bray’s post on the possibly forthcoming quo
warranto proceeding.
[1] See, e.g., 40 U.S.C. § 751(c)) (providing that the Deputy Administrator
of the General Services Administration “shall be Acting Administrator of
General Services . . ., unless the President shall designate another officer of
the Government, in the event of a vacancy in the office of Administrator”); 38
U.S.C. § 7254(d)) (providing that the “[i]n the event of a vacancy in the
position of chief judge of the Court [of Veterans Appeals], the associate judge
senior in service on the Court shall serve as acting chief judge unless the
President designates one of the other associate judges to serve as acting chief
judge, in which case the judge so designated shall serve as acting chief
judge”).
[2] The Senate version
read:
§
3347. Application. (a) Sections 3345 and 3346 [the provisions giving the
President the authority to appoint persons to vacant offices temporarily] are
applicable to any office of an Executive agency (including the Executive Office
of the President, and other than the General Accounting Office) for which
appointment is required to be made by the President, by and with the advice and
consent of the Senate, unless—
(1)
another statutory provision expressly provides that the such provision supersedes
sections 3345 and 3346;
(2) a
statutory provision in effect on the date of enactment of the Federal Vacancies
Reform Act of 1998 expressly— (A) authorizes the President, a court, or the
head of an Executive department, to designate an officer or employee to perform
the functions and duties of a specified office temporarily in an acting
capacity; or (B) designates an officer or employee to perform the functions and
duties of a specified office temporarily in an acting capacity; or (3) the
President makes an appointment to fill a vacancy in such office during the
recess of the Senate pursuant to clause 3 of section 2 of article II of the
United States Constitution.