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An overview of the 'Clearly Erroneous' standard of review as applied to administrative agencies in federal courts.
Source: Clearly Erroneous
The 'Clearly Erroneous' standard of review is utilized by courts when evaluating a lower court or agency’s factual findings. Under this standard, appellate courts will defer to the lower body's findings unless it is left with a definite and firm conviction that a mistake has been made.
This standard is particularly applied in administrative agency cases involving factual determinations made by the agency during an adjudication process. It generally comes into play when courts review decisions made by agencies after a formal hearing with evidence presented.
The Supreme Court held that while courts must defer to an agency's factual findings, they must also ensure that the findings are backed by substantial evidence.
The Court affirmed that administrative agencies are afforded deference in their fact-finding, but clarity in the reasoning behind those findings is essential for review.
The 'Clearly Erroneous' standard is less deferential than the 'Arbitrary and Capricious' standard, which is often used for reviewing agency rulemaking decisions. Unlike the former, the latter focuses on whether an agency acted without a rational basis.