Legal Definitions - residuum rule

The residuum rule is a principle in administrative law that historically guided how courts reviewed decisions made by government agencies. This rule stated that if an administrative agency's decision was based partly on hearsay evidence, a court would only uphold that decision if it was also supported by at least some "competent evidence."

To clarify:

• Hearsay evidence refers to a statement made out-of-court that is offered in court (or before an agency) to prove the truth of the matter asserted. It is generally considered less reliable because the person who made the statement cannot be cross-examined or directly questioned about its accuracy.
• Competent evidence, in this context, refers to evidence that would typically be admissible in a court of law, such as direct testimony from a witness who can be cross-examined, authenticated documents, or expert reports.

Essentially, the residuum rule required that even if an agency considered less reliable hearsay, its final decision needed a "residue" of more reliable, legally admissible evidence to be considered valid by a reviewing court. It's important to note that the residuum rule has largely been rejected by both federal and state courts. This means that agencies are generally permitted to base decisions on hearsay evidence, as long as that evidence is considered reliable and substantial enough to support the agency's findings.

Here are some hypothetical examples illustrating how the residuum rule would have applied:

• Worker's Compensation Claim:

  Imagine an employee files a claim for a workplace injury with a state worker's compensation board (an administrative agency). The agency considers a written statement from a former colleague, who has since moved out of state, describing how the injury occurred (this is hearsay). However, the agency also considers direct testimony from the employee's current supervisor, who witnessed the employee struggling immediately after the alleged incident and observed the workplace conditions.

  How it illustrates the rule: If the residuum rule were still widely applied, a court reviewing the agency's decision to grant benefits would look for that "residue" of competent evidence. The supervisor's direct testimony would serve as the competent evidence, allowing the court to uphold the agency's decision even though it also considered the hearsay statement from the former colleague.

• Zoning Variance Request:

  Consider a homeowner applying to a local zoning board (an administrative agency) for a variance to build a larger garage than typically allowed. The board receives several anonymous letters from neighbors expressing concerns about increased traffic and noise (hearsay). However, the board also reviews an official traffic study conducted by the city's planning department, which objectively assesses the potential impact of the proposed garage on local traffic flow and parking.

  How it illustrates the rule: Under the residuum rule, if the zoning board decided to deny the variance, a court reviewing that decision would need to see that it wasn't based solely on the anonymous, unverified complaints. The official traffic study would provide the necessary competent evidence, allowing the court to affirm the board's decision, despite the inclusion of hearsay.

• Professional Licensing Board Decision:

  A state professional licensing board investigates a complaint against a licensed therapist for alleged unethical conduct. The board considers a detailed written complaint from a former client (hearsay, as the client might not testify in person). Additionally, the board reviews the therapist's meticulously kept patient records, which document the sessions and treatment plans, and hears expert testimony from another licensed therapist about professional standards of care.

  How it illustrates the rule: If the board decided to suspend the therapist's license, a court applying the residuum rule would ensure that the decision wasn't based entirely on the former client's written complaint. The patient records and the expert testimony would constitute the competent evidence, providing the necessary foundation for the court to uphold the board's disciplinary action.