Respondents (Bonjorno), the sole stockholders of a now defunct
aluminum pipe fabrication company, brought suit against petitioners
(Kaiser) in the District Court, alleging that Kaiser had
monopolized the market for such pipe in violation of the Sherman
Act. Judgment for Bonjorno on a jury verdict and damages award was
entered on August 22, 1979. However, the District Court found that
this judgment was not supported by the evidence, and held a limited
retrial on the issue of damages, which resulted in a jury award of
$9,567,939 on December 2, 1981. After judgment was entered on
December 4, 1981, the District Court granted a partial judgment
notwithstanding the verdict. The Court of Appeals,
inter
alia, vacated the latter judgment and reinstated and affirmed
the December 4 judgment, issuing its mandate in 1986. The
postjudgment interest statute in effect when Bonjorno's complaint
was in filed provided that "interest shall be calculated from
the date of the entry of judgment, at
the rate
allowed by State law." 28 U.S.C. § 1961 (1976 ed.). In 1982, while
the appeal was pending, an amended § 1961 went into effect, which
specified that "interest shall be calculated
from the date of
the entry of the judgment, at a rate" based on the price for
United States Treasury bills settled "
immediately prior to the
date of judgment." 28 U.S.C. § 1961 (1982 ed.). The District
Court held that § 1961 required interest to be calculated from
December 2, 1981, the date of the damages verdict. However, it
rejected Bonjorno's argument that
Bradley v. Richmond School
Bd., 416 U. S. 696 --
which held that courts are to apply the law in effect at the time
of decision except where retrospective application would result in
manifest injustice to one of the parties or where there is clear
congressional intent to the contrary -- required that the amended
version of the statute be applied to determine the applicable
interest rate. The Court of Appeals affirmed the District Court's
determination of the date from which interest should be calculated,
but reversed on the issue of which version of § 1961 applied.
Page 494 U. S. 828
Held:
1. Postjudgment interest properly runs from the date of the
entry of judgment, not the date of the verdict. Both versions of §
1961 refer specifically to the "date of judgment," which indicates
a date certain, and there is no legislative history that would
indicate a contrary congressional intent. Pp.
494 U. S.
834-835.
2. Interest should be calculated from December 4, 1981, rather
than August 22, 1979, the date of the District Court's legally
insufficient judgment. The purpose of postjudgment interest is to
compensate the successful plaintiff for being deprived of
compensation for the loss from the time between the ascertainment
of the damage and the payment by the defendant. It would be
counterintuitive to believe that Congress intended interest to be
calculated from a judgment on damages that was not supported by the
evidence, since such damages have not been "ascertained" in any
meaningful way. Pp.
494 U. S.
835-836.
3. Amended § 1961 is not applicable to judgments entered before
its effective date. The plain language of both versions of § 1961
evidences clear congressional intent that the interest rate for any
particular judgment is to be determined as of the date of the
judgment, and that a single applicable rate of interest is to be
applied to the judgment for the duration of the interest accrual
period. In addition, Congress delayed the effective date of the
amended version by six months to permit courts and attorneys to
prepare for the change in the law, and, therefore, at the very
least, the amended version cannot be applied before its effective
date. Implicit in the amended provision's legislative history --
which indicates that Congress wished to lessen the incentives of
losing defendants to take frivolous appeals in order to collect
interest at the prevailing market rates while paying plaintiffs at
the lower state-set rates -- is the understanding that, on the date
of judgment, expectations with respect to liability would be fixed
so that the parties could make informed decisions about the cost
and potential benefits of paying the judgment or seeking appeal.
This Court need not reconcile the apparent tension between the two
lines of precedent governing retrospective application that are
represented by
Bradley v. Richmond School Bd., supra, and
Bowen v. Georgetown University Hospital, 488 U.
S. 204, which held that congressional enactments will
not be construed to have retroactive effect unless their language
requires this result. Under either view, where the congressional
intent is clear, it governs. Pp.
494 U. S.
836-840.
4. The equities of the case do not require that the rate of
interest be set at a rate higher than that afforded by § 1961.
Where Congress has not seen fit to provide for a higher interest
rate with respect to antitrust
Page 494 U. S. 829
suits and has set a definite applicable rate, the courts may not
legislate to the contrary. P.
494 U. S.
840.
865 F.2d 566, (C.A.3 1989), affirmed in part, reversed in part,
and remanded.
O'CONNOR, J., delivered the opinion of the Court, in which
REHNQUIST, C.J., and STEVENS, SCALIA, and KENNEDY, JJ., joined.
SCALIA, J., filed a concurring opinion,
post, p.
494 U. S. 830.
WHITE, J., filed a dissenting opinion, in which BRENNAN, MARSHALL,
and BLACKMUN, JJ., joined,
post, p.
494 U. S.
858.
Justice O'CONNOR delivered the opinion of the Court.
We are called upon in these cases to decide the applicable rate
of postjudgment interest and the date from which postjudgment
interest should be calculated pursuant to the federal postjudgment
interest statute. 28 U.S.C. § 1961 (1982 ed.) (amended).
I
Respondents (Bonjorno) were the sole stockholders of now defunct
Columbia Metal Culvert Co., Inc., which was at one time a
fabricator of aluminum drainage pipe in Vineland, New Jersey.
Bonjorno brought suit against petitioners (Kaiser) in the United
States District Court for the Eastern District of Pennsylvania on
the theory that Kaiser had monopolized the market for aluminum
drainage pipe in the Mid-Atlantic region of the United States in
violation of the Sherman Act. 26 Stat. 209,
as amended, 15
U.S.C. §§ 1 and 2 (1988).
At the first trial, the District Court entered a directed
verdict for Kaiser. The Court of Appeals for the Third Circuit
reversed, holding that there was sufficient evidence for the case
to go to the jury.
Columbia Metal Culvert Co. v. Kaiser
Aluminum & Chemical Corp., 579 F.2d 20, 37 (1978).
Page 494 U. S. 830
On August 21, 1979, a second trial resulted in a jury verdict in
respondents' favor in the trebled amount of $5,445,000. The
judgment was entered on August 22, 1979. The District Court held
that the evidence did not support the jury's damages award and
granted petitioners' motion for a new trial as to damages only.
518 F.
Supp. 102, 109, 119 (ED Pa.1981). A limited retrial on damages
resulted in a jury award on December 2, 1981, in the trebled amount
of $9,567,939. Judgment was entered on December 4, 1981. On January
17, 1983, the District Court granted Kaiser's motion for judgment
notwithstanding the verdict as to a portion of the damages awarded
by the jury.
559 F.
Supp. 922 (ED Pa.1983). Bonjorno appealed the reduction in
damages, and the Court of Appeals reversed the District Court's
partial grant of petitioners' motion for judgment notwithstanding
the verdict as to damages, vacated the judgment, and reinstated and
affirmed the judgment entered on December 4, 1981. 752 F.2d 802,
815 (CA3 1984). Kaiser's petition for rehearing in banc was denied,
as was its subsequent petition for certiorari to this Court. 477
U.S. 908 (1986).
The Court of Appeals did not refer in its opinion to the
allowance of postjudgment interest; Bonjorno petitioned the Court
of Appeals for instructions regarding interest to be included in
the mandate pursuant to Federal Rule of Appellate Procedure 37,
which permits courts of appeal to direct payment of interest
commencing with the entry of judgment in the district court unless
otherwise provided by law. Before the Court of Appeals could rule
on the petition, the parties entered into a stipulation providing
that the District Court first address all issues of interest
allowable under 28 U.S.C. § 1961 and Federal Rule of Appellate
Procedure 37. The Court of Appeals approved the stipulation and
certified the
Page 494 U. S. 831
judgment in lieu of a formal mandate. On July 1, 1986, the
mandate of the Court of Appeals, stayed pending disposition of
Kaiser's petition for a writ of certiorari with this Court, was
issued to the District Court. On July 3, 1986, Kaiser paid Bonjorno
$9,567,939, the trebled amount of damages awarded by the jury on
December 2, 1981.
The federal statute governing awards of postjudgment interest in
effect at the time Bonjorno filed the complaint on January 17,
1974, and until October 1, 1982, provided:
"Interest shall be allowed on any money judgment in a civil case
recovered in a district court. Execution therefor may be levied by
the marshal, in any case where, by the law of the State in which
such court is held, execution may be levied from interest on
judgments recovered in the courts of the State. Such interest shall
be calculated from the date of the entry of judgment, at the rate
allowed by State law."
28 U.S.C. § 1961 (1976 ed.).
On April 2, 1982, Congress passed the Federal Courts Improvement
Act of 1982, Pub.L. 97-164, 96 Stat. 25, § 302 of which amended 28
U.S.C. § 1961. To permit courts and the bar to prepare themselves
for the changes wrought by the Act, Congress delayed its effective
date by six months to October 1, 1982. § 402, 96 Stat. 57. The
amended version provides:
"(a) Interest shall be allowed on any money judgment in a civil
case recovered in a district court. Execution therefor may be
levied by the marshal, in any case where, by the law of the State
in which such court is held, execution may be levied for interest
on judgments recovered in the courts of the State. Such interest
shall be calculated from the date of the entry of the judgment, at
a rate equal to the coupon issue yield equivalent (as determined by
the Secretary of the Treasury) of the average accepted auction
price for the last auction of fifty-two week United States Treasury
bills settled immediately
Page 494 U. S. 832
prior to the date of the judgment. The Director of the
Administrative Office of the United States Courts shall distribute
notice of that rate and any changes in it to all Federal
judges."
"(b) Interest shall be computed daily to the date of payment
except as provided in section 2516(b) of this title and section
1304(b) of title 31, and shall be compounded annually."
28 U.S.C. § 1961 (1982 ed.).
The District Court held that 28 U.S.C. § 1961 required interest
to be calculated from December 2, 1981, the date of the damages
verdict on which the correct judgment would have been entered but
for the District Court's erroneous partial grant of judgment
notwithstanding the verdict.
See Poleto v. Consolidated Rail
Corp., 826 F.2d 1270, 1280 (CA3 1987) (interest calculated
from date of verdict rather than judgment);
Institutionalized
Juveniles v. Secretary of Public Welfare, 758 F.2d 897, 927
(CA3 1985) (interest calculated from date correct award would have
been entered but for the District Court's error). The District
Court rejected Bonjorno's argument that the amended version of §
1961 should be applied for the purpose of determining the
applicable interest rate under
Bradley v. Richmond School
Board, 416 U. S. 696
(1974) (courts are to apply the law in effect at the time a court
renders its decision unless such application results in manifest
injustice or runs contrary to congressional intent), reasoning that
application of amended § 1961 would result in manifest injustice.
Thus, the District Court applied the earlier version of § 1961,
which set the interest rate allowed by state law. At that time,
Pennsylvania provided for a 6 percent rate of interest. 42
Pa.Cons.Stat. § 8101 (1988); Pa.Stat.Ann., Tit. 41, § 202 (Purdon
Supp.1989).
The Court of Appeals affirmed the District Court's determination
that interest should be calculated from December 2, 1981, but
reversed the District Court on the issue of which
Page 494 U. S. 833
version of § 1961 applied. The Court of Appeals invoked the rule
in
Bradley, supra, that a court should apply the law in
effect at the time a court renders its decision, but noted that
"the
Bradley presumption of applying the law in effect
at the time a court renders its decision in the absence of contrary
legislative intent seems inconsistent with the longstanding rule of
statutory construction that statutes are presumed to have only
'prospective' effect and will be given 'retroactive' effect only if
there is affirmative legislative direction to do so."
865 F.2d 566, 573 (CA3 1989). Finding the legislative history
unclear and that application of the amended § 1961 would not result
in manifest injustice, the Court of Appeals held that the
Bradley presumption required application of the amended §
1961 in effect at the time the District Court and the Court of
Appeals reached their decisions.
The Court of Appeals acknowledged that its decision was in
conflict with decisions on the same issue in other Courts of
Appeal. Three approaches have been followed by the Courts of
Appeal: (1) the amended version of § 1961 is applied to judgments
entered after the effective date,
see United States v. Dollar
Rent A Car Systems, Inc., 712 F.2d 938, 940, n. 5 (CA4 1983);
Merit Ins. Co. v. Leatherby Ins. Co., 728 F.2d 943, 944
(CA7 1984),
cert. denied, 469 U.S. 918 (1984);
Litton
Systems, Inc. v. American Tel. & Tel. Co., 746 F.2d 168,
174 (CA2 1984);
Brooks v. United States, 757 F.2d 734,
741-742 (CA5 1985); (2) the amended version applies to judgments
entered before the effective date for the duration of the
postjudgment interest period,
see R.W.T. v. Dalton, 712
F.2d 1225, 1234-1235 (CA8),
cert. denied, 464 U.S. 1009
(1983); and (3) the amended version applies to judgments entered
before the effective date but only for interest accruing in the
period after the effective date.
See Bailey v. Chattem,
Inc., 838 F.2d 149, 155-156 (CA6),
cert. denied, 486
U.S. 1059 (1988);
Campbell v. United States, 809 F.2d 563,
577 (CA9 1987).
Page 494 U. S. 834
We granted certiorari, 491 U.S. 903 (1989), primarily to
consider three questions: first, whether interest should be
calculated from the date of verdict or the date of judgment;
second, whether interest should be calculated from the date of a
legally insufficient judgment; and third, the proper application of
§ 1961 to judgments entered before the effective date of amended §
1961.
II
A
Kaiser argues that the appropriate date from which interest
should be calculated is the date of the entry of the later
judgment, December 4, 1981, and not the date of the verdict,
December 2, 1981. Both the Court of Appeals and the District Court
held that postjudgment interest should be calculated from December
2, 1981, the date of verdict, relying on settled Third Circuit
precedent.
See Poleto v. Consolidated Rail Corp., 826 F.2d
1270, 1280 (1987) (interest calculated from date on which jury
returns verdict on damages). The Courts of Appeal are split on this
issue.
Compare Millers' Nat'l Ins. Co., Chicago, Ill. v.
Wichita Flour Mills Co., 257 F.2d 93, 104 (CA10 1958)
(interest calculated from date of judgment) with
Turner v.
Japan Lines, Ltd., 702 F.2d 752 (CA9 1983) (interest
calculated from date of verdict). Those courts who have determined
that interest should run from the verdict have looked to the policy
underlying the postjudgment interest statute -- compensation of the
plaintiff for the loss of the use of the money -- in reaching their
conclusion that interest should run from the date of the judgment
despite the language of the statute.
See, e.g., Poleto, supra.
Cf. Note, Interest on Judgments in the Federal Courts, 64 Yale
L.J. 1019, 1039 (1955) ("Allowance of interest from verdict [under
state postjudgment statutes despite their plain language] is
generally based on the defendant's fault in causing the delay in
entry of judgment and on the desirability of fully compensating the
plaintiff for the loss of use of his recovery").
Page 494 U. S. 835
The starting point for interpretation of a statute
"is the language of the statute itself. Absent a clearly
expressed legislative intention to the contrary, that language must
ordinarily be regarded as conclusive."
Consumer Product Safety Comm'n v. GTE Sylvania, Inc.,
447 U. S. 102,
447 U. S. 108
(1980).
"By linking all postjudgment activity to the entry of a
judgment, the courts have been provided a uniform time from which
to determine postjudgment issues."
Comment, Post-Judgment Interest in Federal Courts, 37 Emory L.J.
495, 499 (1988). Both the original and the amended versions of §
1961 refer specifically to the "date of judgment," which indicates
a date certain. Neither alludes to the date of the verdict, and
there is no legislative history that would indicate congressional
intent that interest run from the date of verdict rather than the
date of judgment. Even though denial of interest from verdict to
judgment may result in the plaintiff's bearing the burden of the
loss of the use of the money from verdict to judgment, the
allocation of the costs accruing from litigation is a matter for
the legislature, not the courts.
See Alyeska Pipeline Service
Co. v. Wilderness Society, 421 U. S. 240,
421 U. S. 271
(1975). In light of the plain language and the absence of
legislative intent to the contrary, we conclude that postjudgment
interest properly runs from the date of the entry of judgment.
B
Bonjorno asserts, in its cross-petition, that the judgment from
which interest should be calculated is not that entered in
December, 1981, but rather the date of the judgment entered on
August 22, 1979, the damages portion of which the District Court
later found was not supported by the evidence. The District Court's
determination that the jury's finding on damages was not supported
by the evidence was not appealed by either party.
"[T]he purpose of postjudgment interest is to compensate the
successful plaintiff for being deprived of compensation for the
loss from the time between the ascertainment of the damage
Page 494 U. S. 836
and the payment by the defendant."
Poleto v. Consolidated Rail Corp., 826 F.2d at 1280.
Where the judgment on damages was not supported by the evidence,
the damages have not been "ascertained" in any meaningful way. It
would be counterintuitive, to say the least, to believe that
Congress intended postjudgment interest to be calculated from such
a judgment.
See FDIC v. Rocket Oil Co., 865 F.2d 1158
(CA10 1989) (postjudgment interest may not be calculated from
judgment that was completely reversed).
Accordingly, we hold that the Court of Appeals properly rejected
Bonjorno's contention that interest should be calculated from
August 22, 1979, but erred in calculating interest from December 2,
1981, rather than December 4, 1981.
III
The Court in
Bradley v. Richmond School Bd.,
416 U. S. 696
(1974), faced the issue whether an attorney's fee statute that went
into effect during the pendency of the appeal was to be applied by
the appellate court. Relying on
Thorpe v. Durham Housing
Authority, 393 U. S. 268
(1969), the Court held that "a court is to apply the law in effect
at the time it renders its decision." 416 U.S. at
416 U. S. 711.
The Court derived this holding from a broad reading of
United States v. Schooner
Peggy, 1 Cranch 103 (1801), in which the following
principles were articulated:
"[I]f subsequent to the judgment, and before the decision of the
appellate court, a law intervenes and positively changes the rule
which governs, the law must be obeyed. . . . It is true that, in
mere private cases between individuals, a court will and ought to
struggle hard against a construction which will, by a retrospective
operation, affect the rights of parties, but in great national
concerns . . . the court must decide according to existing
laws."
Id., 1 Cranch at
5
U. S. 110. Under the rule set forth in
Schooner
Peggy, an amendment to the law while a case was pending should
be applied by the appellate
Page 494 U. S. 837
court only if, "by its terms," the law was to be applied to
pending cases.
See Bradley, supra, 416 U.S. at
416 U. S. 712.
In
Thorpe, supra, the Court broadened the rule set forth
in
Schooner Peggy: "[E]ven where the intervening law does
not explicitly recite that it is to be applied to pending cases, it
is to be given recognition and effect."
Bradley, supra, at
416 U. S. 715.
As a means of softening the potentially harsh impact of this
broadening retrospective application of congressional enactments,
the Court recognized two exceptions to the presumption that courts
are to apply the law in effect at the time of decision. The
presumption does not govern where retrospective application would
result in manifest injustice to one of the parties or where there
is clear congressional intent to the contrary.
See 416
U.S. at
416 U. S. 711.
The Court of Appeals applied the
Bradley test and held
that the legislative history was ambiguous and that retrospective
application of amended § 1961 did not result in manifest
injustice.
In apparent tension with the rule articulated in
Bradley,
supra, is our recent reaffirmation of the generally accepted
axiom that
"[r]etroactivity is not favored in the law. . . .
[C]ongressional enactments and administrative rules will not be
construed to have retroactive effect unless their language requires
this result."
Bowen v. Georgetown University Hospital, 488 U.
S. 204,
488 U. S. 208
(1988). In
Georgetown University Hospital, we held that
the Department of Health and Human Services did not have the power
to promulgate retroactive cost-limit rules, because authority to
issue retroactive rules was not authorized by Congress in the
Medicare Act.
Id. at
488 U. S.
208-216.
We need not in this case, however, reconcile the two lines of
precedent represented by
Bradley, supra, and
Georgetown, supra, because, under either view, where the
congressional intent is clear, it governs.
See Bradley,
supra, 416 U.S. at
416 U. S.
716-717 (intervening statute applies retroactively
unless a contrary intention appears);
Georgetown, supra,
488 U.S. at
488 U. S. 208
(statute does not apply retroactively unless its language
requires
Page 494 U. S. 838
it). We conclude that the plain language of both the original
and amended versions of § 1961 evidence clear congressional intent
that amended § 1961 is not applicable to judgments entered before
its effective date.
As both the original and the amended versions of § 1961
indicate, a court must consider two factors to determine how much
postjudgment interest is owed: (1) the length of time the interest
is to run, which requires identification of a starting point and an
ending point, and (2) the interest rate at which the interest is to
be computed. Section 1961, originally and as amended, provides the
starting point -- the date of the entry of judgment -- and the
interest rate. The termination point is set by the party who pays
the judgment, and in general it may occur at any time following
entry of judgment.
Under both versions of § 1961, the calculation of interest is
inextricably tied to the date of the entry of judgment. Both
provisions provide that the interest due "shall be calculated
from the date of the entry of the judgment." Indeed, even
the calculation of the interest rate in amended § 1961 is tied to
the judgment date:
"interest shall be calculated . . . at a rate equal to the
coupon issue yield equivalent . . . of the average accepted auction
price for the last auction of fifty-two week United States Treasury
bills settled
immediately prior to the date of the
judgment."
See Litton, 746 F.2d at 174 (calculation of rate tied
to judgment date indicates Congress intended prospective
application of amended § 1961).
The language of each version of the statute also directs that a
single applicable rate of interest be applied to the judgment: the
prior version refers to "the rate" and the amended version to "a
rate."
See Comment, 37 Emory L.J., at 532-633, n. 207
("[P]lain language of the [amended version] indicates that only one
interest rate will apply"). We think the most logical reading of
the statute is that the interest rate for any particular judgment
is to be determined as of the date of
Page 494 U. S. 839
the judgment, and that is the single rate applicable for the
duration of the interest accrual period.
Congress delayed the effective date on the amended version by
six months to permit courts and attorneys to prepare for the change
in the law. S.Rep. No. 97-275, p. 32 (1981) ("[T]he delay is
intended to provide time for planning the transition and for
permitting the bar to become familiar with the provisions"). Thus,
at the very least, the amended version cannot be applied before the
effective date of 1982.
See Campbell v. United States, 809
F.2d 563, 574 (CA9 1987) ("[T]he literal terms of the Senate
committee report . . . preclude imposition of interest at the
T-bill rate . . . in the period prior to the enactment date").
Given that the plain language only admits of one relevant interest
rate and that the amended rate cannot be applied before the
effective date of October 1, 1982, we conclude that the interest
rate to be applied to judgments entered before October 1, 1982, is
the rate set pursuant to the prior version of § 1961.
In the brief legislative history available, there is a single
stated purpose for Congress' alteration of the interest rate from
the State rate to the Treasury bill rate. Under the prior version
of § 1961,
"a losing defendant may have an economic incentive to appeal a
judgment solely in order to retain his money and accumulate
interest on it at the commercial rate during the pendency of the
appeal."
S.Rep. No. 97275,
supra, at 30. Because the prevailing
state-set rates were significantly lower than market rates, losing
parties found it economical to pursue frivolous appeals. Implicit
in Congress' desire to alter the incentives to appeal is the
understanding that, at the time judgment is entered, the parties
are capable of calculating the value or cost of the interest
throughout the time period during which the judgment remains
unpaid. In other words, on the date of judgment, expectations with
respect to interest liability were fixed, so that the parties could
make informed decisions about the cost and potential benefits of
paying the judgment or seeking appeal.
Page 494 U. S. 840
Given Congress' understanding of the expectation of the parties
on the date of judgment and the plain language of the statute, we
conclude that both versions of § 1961 fix the rate of interest as
of the date of the entry of judgment and, therefore, amended § 1961
may not be applied retrospectively.
See 865 F.2d at 577
(Stapleton, J., concurring and dissenting) ("[T]he rule established
by § 1961 after its amendment, as well as the rule established by
it before, are focused on a particular point in time -- the date of
the entry of judgment. On that date, under both rules, the rate of
postjudgment interest is fixed once and for all time for the
particular case, and the rate fixed takes effect immediately").
Because the entry of judgment in this case occurred before
October 1, 1982, we reverse the Court of Appeals' determination
that amended § 1961 governs the calculation of postjudgment
interest.
IV
Finally, in its cross-petition, Bonjorno asserts that the
equities of the case require that the rate of interest be set at a
rate higher than that afforded by § 1961. "At common law, judgments
do not bear interest; interest rests solely upon statutory
provision."
Pierce v. United States, 255 U.
S. 398,
255 U. S. 406
(1921). Where Congress has not seen fit to provide for a higher
rate of interest with respect to antitrust suits and has set a
definite interest rate that governs this case, the courts may not
legislate to the contrary.
For the foregoing reasons, the judgment of the Court of Appeals
is reversed in part and affirmed in part and the cases are remanded
for further proceedings consistent with this opinion.
It is so ordered.
Justice SCALIA, concurring.
I join the Court's opinion because I agree that this statute
contains positive indication that its operation is to be
prospective. In my view, however,
Page 494 U. S. 841
that indication is unnecessary to our determination. I regret
that the Court has chosen not to resolve the conflict between two
relatively recent cases, saying that, unless there is specific
indication to the contrary, a new statute should be applied
retroactively absent "manifest injustice,"
Bradley v. Richmond
School Bd., 416 U. S. 696,
416 U. S. 716
(1974);
Thorpe v. Housing Authority of Durham,
393 U. S. 268,
393 U. S. 282
(1969), and the many cases, old and new, which have said that,
unless there is specific indication to the contrary, a new statute
should be applied only prospectively,
e.g., Bowen v. Georgetown
University Hosp., 488 U. S. 204,
488 U. S. 208
(1988);
United States v. American Sugar Refining Co.,
202 U. S. 563, 577
(1906). In the rules of construction that they announce, if not in
the results they produce, these two lines of cases are not merely,
as the Court confesses, in "apparent tension,"
ante at
494 U. S. 837;
they are in irreconcilable contradiction, and have spawned Courts
of Appeals opinions to match.
Compare, e.g., Davis v.
Omitowoju, 883 F.2d 1155, 1170-1171 (CA3 1989), and
Anderson v. USAIR, Inc., 260 U.S.App.D.C. 183, 187, 818
F.2d 49, 53 (1987),
with United States v. R.W. Meyer,
Inc., 889 F.2d 1497, 1505-1506 (CA6 1989), and
United
States v. Marengo County Comm'n, 731 F.2d 1546, 1553-1555
(CA11),
appeal dism'd, 469 U.S. 976 (1984). Since the
issue has been briefed and argued in this case, I would have taken
the occasion to admit that the rule we expressed in
Thorpe and
Bradley was wrong, and to reaffirm
the clear rule of construction that has been applied, except for
these last two decades of confusion, since the beginning of the
Republic and indeed since the early days of the common law: absent
specific indication to the contrary, the operation of nonpenal
legislation is prospective only. [
Footnote 1]
Page 494 U. S. 842
I
During all of the 19th and most of the 20th centuries, our cases
expressed and applied, to my knowledge without exception, the
principle that legislation is to be applied only prospectively
unless Congress specifies otherwise.
See the numerous
cases cited in Smead, The Rule Against Retroactive Legislation: A
Basic Principle of Jurisprudence, 20 Minn.L.Rev. 775, 781, n. 22
(1936). To give a few examples: In
United
States v. Heth, 3 Cranch 399,
7 U. S. 413
(1806), we refused to apply a new (lower) commission rate for
custom collectors to amounts already bonded but not yet collected
at the time the new rates took effect. Justice Paterson wrote:
"Words in a statute ought not to have a retrospective operation,
unless they are so clear, strong, and imperative, that no other
meaning can be annexed to them, or unless the intention of the
legislature cannot be otherwise satisfied."
In
Murray v.
Gibson, 15 How. 421,
56 U. S. 423
(1854), we refused to apply retroactively a Mississippi statute
limiting to three years the period in which another state court
judgment would be enforced by Mississippi courts against a citizen
of that State. We reaffirmed that
"[a]s a general rule for the interpretation of statutes, it may
be laid down that they never should be allowed a retroactive
operation where this is not required by express command or by
necessary and unavoidable implication. Without such command or
implication, they speak and operate on the future only."
A case very similar to the one we decide today is
United
States v. Magnolia Petroleum Co., 276 U.
S. 160 (1928). There respondent had been
overassessed
Page 494 U. S. 843
on federal income and profits taxes. At the time it requested a
refund of its overpayment and at the time the refund was allowed by
the Commissioner, the relevant statute provided that interest on
the amount was "to commence six months after the filing of claim
for refund,"
id., 276 U.S. at
276 U. S. 161,
unless the taxes had been paid under protest. Before the refund was
made, however, Congress amended the statute to provide that
interest should run from the actual date of the overpayment.
Respondent then argued, as do respondents in this case, that
because "the interest had not yet been paid, respondent became
entitled to an amount calculated according to the later enactment."
Id. at
276 U. S. 162.
We rejected this argument, reaffirming the presumption that
"[s]tatutes are not to be given retroactive effect or construed
to change the status of claims fixed in accordance with earlier
provisions unless the legislative purpose so to do plainly
appears."
Id. at
276 U. S.
162-163.
See also the following expressions of
the rule:
"Where it is claimed that a law is to have a retrospective
operation, such must be clearly the intention, evidenced in the law
and its purposes, or the court will presume that the lawmaking
power is acting for the future only and not for the past. . .
."
White v. United States, 191 U.
S. 545,
191 U. S. 552
(1903).
"There are certain principles which have been adhered to with
great strictness by the courts in relation to the construction of
statutes as to whether they are or are not retroactive in their
effect. The presumption is very strong that a statute was not meant
to act retrospectively, and it ought never to receive such a
construction if it is susceptible of any other. It ought not to
receive such a construction unless the words used are so clear,
strong and imperative that no other meaning can be annexed to them
or unless the intention of the legislature cannot be otherwise
satisfied."
United States
Fidelity
Page 494 U. S. 844
& Guaranty Co. v. United States ex rel. Struthers Wells
Co., 209 U. S. 306,
209 U. S. 314
(1908).
"[A] retrospective operation will not be given to a statute
which interferes with antecedent rights or by which human action is
regulated, unless such be the unequivocal and inflexible import of
the terms, and the manifest intention of the legislature."
Union Pacific R. Co. v. Laramie Stock Yards Co.,
231 U. S. 190,
231 U. S. 199
(1913).
"The initial admonition is that laws are not to be considered as
applying to cases which arose before their passage unless that
intention be clearly declared."
"
* * * *"
"If the absence of such determining declaration leaves to the
statute a double sense, it is the command of the cases that that
which rejects retroactive application must be selected."
Shwab v. Doyle, 258 U. S. 529,
258 U. S.
534-535 (1922).
"[A] statute cannot be construed to operate retrospectively
unless the legislative intention to that effect unequivocally
appears."
Miller v. United States, 294 U.
S. 435,
294 U. S. 439
(1935)
During these more than 150 years of doctrinal certainty, we did
not always deny retroactive application to new statutory law. But
when we accorded it, the reason was that the statute affirmatively
so required.
See, e.g., 33 U. S.
Mercer, 8 Pet. 88 (1834);
Graham & Foster v.
Goodcell, 282 U. S. 409
(1931). If the new law was silent as to its application, we
consistently employed the presumption that it applied only
prospectively.
See Smead at 780-781 & n. 22.
II
A
The current confusion began with the case of
Thorpe v.
Housing Authority of Durham, 393 U. S. 268
(1969), involving the eviction of a tenant from low-income housing
operated
Page 494 U. S. 845
by the city of Durham, North Carolina. The tenant alleged that
her lease had been terminated because of her activities in
organizing a tenants' association, thus violating her First
Amendment rights. That claim was rejected by the North Carolina
Supreme Court, and we granted certiorari. While the case was
pending here, the federal Department of Housing and Urban
Development promulgated a regulation directing that
"before instituting an eviction proceeding local housing
authorities . . . should inform the tenant . . . of the reasons for
the eviction . . . ."
Id. 393 U.S. at
393 U. S. 272.
We held that the regulation had to be applied retroactively, to
invalidate the eviction order issued almost 18 months before the
regulation had been adopted. "The general rule," we said, "is that
an appellate court must apply the law in effect at the time it
renders its decision."
Id. at
393 U. S.
281.
Thorpe made no mention of our earlier presumption
against retroactive application, and cited none of the numerous
cases supporting that rule. The reason, apparently, was that it
treated as distinctive the situation in which (as in
Thorpe) the change in law occurs between the decision of a
lower court and the decision of the appellate tribunal. Thus, it
cited and discussed only a few cases in which that situation, or a
closely analogous situation, obtained. Foremost among these was
Chief Justice Marshall's opinion in
United
States v. Schooner Peggy, 1 Cranch 103 (1801). The
issue there was whether a French vessel, seized by an American
ship, could be condemned. The Circuit Court had held that
condemnation was proper, but before this Court could issue its
decision, the United States entered into a convention with France
which provided for the restoration of all French "[p]roperty
captured, and not yet
definitively condemned . . . ."
Id., 1 Cranch at 107 [argument of counsel -- omitted]
(emphasis in original). In its determination of whether this
provision applied to the case before it, the Court examined the
explicit language and held that the phrase "and not yet
definitively condemned" required application of the convention to
all cases where property had not yet reached final
condemnation,
Page 494 U. S. 846
even if that property had been seized pre-convention.
Id. at
5 U. S. 109.
Explaining this holding, and specifically rejecting respondent's
argument that, if the judgment below was correct, it could not "be
made otherwise by anything subsequent to its rendition,"
ibid., the Court stated:
"[I]f, subsequent to the judgment, and before the decision of
the appellate court, a law intervenes and positively changes the
rule which governs, the law must be obeyed. . . ."
Id. at
5 U. S. 110.
It is clear that what
Schooner Peggy meant by a law
that "positively changes the rule which governs" was one which,
like the law there at issue, explicitly recites its application to
pre-enactment events. That is evident from its ensuing
discussion:
"It is true that, in mere private cases between individuals, a
court will and ought to struggle hard against a construction which
will, by a retrospective operation, affect the rights of parties,
but in great national concerns, where individual rights, acquired
by war, are sacrificed for national purposes, the contract making
the sacrifice ought always to receive a construction conforming to
its manifest import; and if the nation has given up the vested
rights of its citizens, it is not for the court, but for the
government, to consider whether it be a case proper for
compensation. In such a case, the court must decide according to
existing laws, and if it be necessary to set aside a judgment,
rightful when rendered, but which cannot be affirmed but in
violation of law, the judgment must be set aside."
Ibid.
As I have mentioned,
Thorpe derived from
Schooner
Peggy the "general rule . . . that an appellate court must
apply the law in effect at the time it renders its decision." 393
U.S. at
393 U. S. 281.
Of course it does not stand for that at all -- or at least not in
the sense that
Thorpe implied. It stands for the
proposition that, when Congress
plainly says --
contrary to the ordinary
Page 494 U. S. 847
presumption which courts will "struggle hard" to apply -- that
current law rather than the preexisting law governs the rights of
parties, then courts "must apply" that current law. That is in no
way different from the rule applied in the generality of cases
discussed in Part I of this opinion: if retroactive effect is
explicit, retroactive effect is accorded.
Besides
Schooner Peggy, the
Thorpe opinion
cited only four cases in support of the presumption of
retroactivity. Two of them,
Vandenbark v. Owens-lllinois Glass
Co., 311 U. S. 538
(1941), and
Carpenter v. Wabash R. Co., 309 U. S.
23 (1940), involved, like
Schooner Peggy and
Thorpe itself, a change of law that had occurred between
the initial and the appellate decision. The third,
United
States v. Chambers, 291 U. S. 217
(1934), involved a change that had occurred after a criminal
defendant had pleaded guilty but before judgment had been rendered.
The fourth,
Ziffrin, Inc. v. United States, 318 U. S.
73 (1943), involved a change that had occurred after
application for a license had been made but before it had been
ruled upon. In all four of these cases, the new law was adopted as
the rule of decision. Once again, however, there was nothing in
these decisions contrary to the normal rule of presumptive
nonretroactivity of statutes described in Part I above.
Vandenbark gave retroactive effect not to a statute but to
a judicial decision, which is of course traditionally regarded as
an expression of preexisting law.
See United States v. Security
Industrial Bank, 459 U. S. 70,
459 U. S. 79
(1982) ("The principle that statutes operate only prospectively,
while judicial decisions operate retrospectively, is familiar to
every law student").
Carpenter gave retroactive effect to
a statute that (like the statute in
Schooner Peggy) on its
face explicitly demanded retroactive effect.
Chambers gave
retroactive effect to the repeal of a criminal statute, which has
always been an exception to the general rule that statutes are
prospective,
see n 1,
supra. The last case,
Ziffrin, Inc. v. United States,
supra, did not involve retroactive effect at all, but simply
required the Interstate Commerce
Page 494 U. S. 848
Commission to apply current law (rather than the law in effect
at the time of filing of the permit application) in determining
whether the applicant was qualified to obtain a permit for future
operations. The same result would have obtained in all of these
cases if the change in law had occurred
before the initial
judicial decision, or
before the initial step of the
adjudicatory process.
B
The confusion that
Thorpe introduced into this
otherwise settled area of law was reinforced and perhaps expanded
five years later, in
Bradley v. Richmond School Bd.,
416 U. S. 696
(1974). There we held that a statute providing for the award of
attorney's fees, enacted while an appeal from the district court's
award of fees was pending, had to be applied by the court of
appeals. The opinion said:
"In the wake of
Schooner Peggy, . . . it remained
unclear whether a change in the law occurring while a case was
pending on appeal was to be given effect only where, by its terms,
the law was to apply to pending cases, . . . or, conversely,
whether such a change in the law must be given effect
unless there was clear indication that it was not to apply
in pending cases. For a very long time, the Court's decisions did
little to clarify this issue."
"Ultimately, in
Thorpe v. Housing Authority of the City of
Durham, . . . the broader reading of
Schooner Peggy
was adopted, and this Court ruled that 'an appellate court must
apply the law in effect at the time it renders its decision.'"
"
* * * *"
"Accordingly, we must reject the contention that a change in the
law is to be given effect in a pending case only where that is the
clear and stated intention of the legislature."
Id. 416 U.S. at
416 U. S.
712-715 (footnote omitted).
The reason I say that
Bradley perhaps expanded the
confusion of
Thorpe is not because of its holding. Whereas
Thorpe could not possibly have come out the way it did
under prior
Page 494 U. S. 849
law,
Bradley probably would not, but might have. It is
at least arguable that it does not constitute retroactive
application to apply a provision dealing with the award of costs or
fees in litigation to all litigation that has not yet terminated
when the provision takes effect. But the reason I say that
Bradley perhaps expanded the confusion of
Thorpe
is that its formulation of the governing principle was arguably
more far-reaching. The
Thorpe formulation ("an
appellate court must apply the law in effect at the time
it renders its decision," 393 U.S. at
393 U. S. 281
(emphasis added)) suggests that the rule of retroactivity applies
only when the law has been changed between the initial and the
appellate decision. The
Bradley formulation ("a change in
the law is to be given effect
in a pending case") more
naturally suggests that all judicial decisions must apply current
law, no matter when the change occurred.
The cases relied upon by
Bradley, however,
see
416 U.S. at
416 U. S.
712-713, n. 17, like the cases relied upon by
Thorpe, all involve changes in law that occurred after an
earlier stage of an adjudicatory proceeding -- thus once again
excluding from the relevant precedent the many cases I have alluded
to in Part I setting forth the presumption of nonretroactivity. But
also like the cases relied upon by
Thorpe, not a single
one of them is genuinely contrary to that generally applied
presumption. They consist entirely of cases that involved
retroactivity of judicial decisions, rather than statutes
(
Moores v. National Bank, 104 U.
S. 625 (1882);
Dorchy v. Kansas, 264 U.
S. 286 (1924);
Sioux County v. National Surety
Co., 276 U. S. 238
(1928);
Patterson v. Alabama, 294 U.
S. 600 (1935);
Vandenbark v. Owens-lllinois Glass
Co., 311 U. S. 538
(1941)); cases in which the statute specifically provided for
retroactive application (
Freeborn v.
Smith, 2 Wall. 160,
69 U. S. 162
(1865);
Stephens v. Cherokee Nation, 174 U.
S. 445,
174 U. S.
477-478 (1899);
Carpenter v. Wabash R. Co.,
309 U. S. 23,
309 U. S. 27
(1940);
Dickinson Industrial Site, Inc. v. Cowan,
309 U. S. 382
309 U. S. 383
(1940)); cases that involved prospective rather than retrospective
application, because they
Page 494 U. S. 850
sought injunctive relief (
Dinsmore v. Southern Express Co.
and Georgia R. Comm'n, 183 U. S. 115,
183 U. S. 120
(1901);
United States v. Alabama, 362 U.
S. 602 (1960) (per curiam )), because the issue was a
permit for future action (
Ziffrin, Inc. v. United States,
318 U. S. 73
(1943)), or because the issue was whether the United States'
declaration of war made it inappropriate for the trial court to
continue with proceedings (
Watts, Watts & Co. v. Unione
Austriaca di Navigazione, 248 U. S. 9 (1918));
a case remanding to state court for its determination of the effect
of a newly enacted state statute (
Missouri ex rel. Wabash R.
Co. v. Public Service Comm'n, 273 U.
S. 126 (1927)); and a case involving the special rule,
see n 1,
supra, applicable to repeal of a criminal sanction
(
United States v. Chambers, 291 U.
S. 217 (1934)).
It is significant that
not a single one of the earlier
cases cited in
Thorpe and
Bradley -- except, of
course, the cases dealing with judicial decisions rather than
statutes and the case dealing with repeal of a criminal statute --
even
purports to be applying a presumption of
retroactivity. They purport to be following the
express
command of the statute, or not to be acting retroactively at all.
One of the cases, however, does mention as applicable to this
(supposedly) special area of change-in-law-pending-appeal, the
general presumption of
nonretroactivity applicable
elsewhere:
"The contention is that the act of July 1, 1898, in extending
the remedy by appeal to this court, was invalid because
retrospective, an invasion of the judicial domain, and destructive
of vested rights. By its terms, the act was to operate
retrospectively, and as to that it may be observed that,
while
the general rule is that statutes should be so construed as to give
them only prospective operation, yet where the language
employed expresses a contrary intention in unequivocal terms, the
mere fact that the legislation is retroactive does not necessarily
render it void."
Stephens v. Cherokee Nation, supra, 174 U.S. at
174 U. S.
477-478 (emphasis added).
Page 494 U. S. 851
C
While
Thorpe was the first case setting forth the
presumption of retroactivity, and
Bradley was the case
expounding its supposed precedential basis in greatest detail, a
number of other cases since
Thorpe have referred to and
(purportedly) applied the presumption, with citation of
Thorpe, Bradley, or both, and sometimes with
citation of one or more of the other cases (discussed above) cited
in
Bradley. These follow-on cases share two significant
characteristics: First, all of them, like
Thorpe and
Bradley, involved change in the law after the initial
adjudication. Where the change has occurred prior to initial
adjudication, we have made no mention of the
Thorpe-Bradley presumption but, to the contrary, have
discussed as though it was uncontroverted "[t]he principle that
statutes operate only prospectively,"
United States v. Security
Industrial Bank, 459 U.S. at
459 U. S. 79 --
and (in seeming inconsistency with the analysis of
Thorpe
and
Bradley) have even quoted from
Schooner Peggy
to support that principle, 459 U.S. at
459 U. S. 79-80.
Our most recent affirmation of the presumption of nonretroactivity
(where the statute antedated initial adjudication) occurred last
Term in
Bowen v. Georgetown University Hosp., 488 U.S. at
208, where the following strong statement of the traditional rule
was necessary to our unanimous decision:
"Retroactivity is not favored in the law. Thus, congressional
enactments and administrative rules will not be construed to have
retroactive effect unless their language requires this result. . .
. By the same principle, a statutory grant of legislative
rulemaking authority will not, as a general matter, be understood
to encompass the power to promulgate retroactive rules unless that
power is conveyed by Congress in express terms."
The second significant feature of the cases citing the
Thorpe-Bradley presumption is that all of them would have
come out the same way applying the pre-
Thorpe law --
for
Page 494 U. S. 852
reasons similar to those mentioned earlier in my discussion of
the cases cited by
Bradley. Most of them involved
prospective rather than retrospective application, since they
sought injunctive or declaratory relief.
See Hall v.
Beals, 396 U. S. 45,
396 U. S. 48
(1969);
Citizens to Preserve Overton Park, Inc. v. Volpe,
401 U. S. 402,
401 U. S.
417-419 (1971);
Diffenderfer v. Central Baptist
Church of Miami, Fla., Inc., 404 U. S. 412,
404 U. S. 414
(1972);
California Bankers Assn. v. Shultz, 416 U. S.
21,
416 U. S. 49, n.
21 (1974);
Cort v. Ash, 422 U. S. 66,
422 U. S. 76-77
(1975);
Youakim v. Miller, 425 U.
S. 231,
425 U. S. 237
(1976) (per curiam );
Treasury Employees v. Von Raab,
489 U. S. 656,
489 U. S. 663
(1989). Some involved the retroactive effect of judicial decisions
rather than statutes.
See Hamling v. United States,
418 U. S. 87,
418 U. S. 102
(1974);
Gulf Offshore Co. v. Mobil Oil Corp., 453 U.
S. 473,
453 U. S. 486,
n. 16 (1981);
Saint Francis College v. Al-Khazraji,
481 U. S. 604,
481 U. S. 608
(1987);
Goodman v. Lukens Steel Co., 482 U.
S. 656,
482 U. S. 662
(1987). And in one case, we found explicit legislative indication
of retroactive intent.
See Hutto v. Finney, 437 U.
S. 678,
437 U. S.
694-695, n. 23 (1978).
In only one of the cases would
Thorpe-Bradley have
yielded a result different from the result produced by prior law --
and there, significantly, we followed the prior law.
Bennett v.
New Jersey, 470 U. S. 632
(1985), was a suit by the Secretary of Education to recover from
the State of New Jersey funds provided to it under Title I of the
Elementary and Secondary Education Act of 1965, Pub.L. 89-10, 79
Stat. 27, that had allegedly been used for ineligible programs.
After the Department of Education's administrative determination of
misuse had been made, and a final determination letter demanding
repayment had been issued, Title I was amended in a fashion which,
the State alleged, would have validated its prior expenditures.
Although this seemed to be a classic case for application of the
Thorpe-Bradley presumption, we applied the opposite
presumption instead. We distinguished
Bradley on the
ground that, in the case before us, "the Government's right to
recover any misused funds
Page 494 U. S. 853
preceded the 1978 Amendments." 470 U.S. at
470 U. S. 639.
We quoted
Bradley's acknowledgment that there was an
exception to its presumption for retroactive application that
"
would infringe upon or deprive a person of a right that had
matured or become unconditional,'" ibid., quoting from 416
U.S. at 416 U. S. 720,
and noted that this "comports with another venerable rule of
statutory interpretation, i.e., that statutes affecting
substantive rights and liabilities are presumed to have only
prospective effect." 470 U.S. at 470 U. S. 639.
I would have thought that the language from Bradley
referred to vested rights, which could not be
retroactively eliminated without just compensation. By expanding
the meaning of that limitation to include all "substantive
rights and liabilities," we arguably deprived Bradley of
its distinctive content, inasmuch as retroactive application is
never sought (or defended against) except as a means of "affecting
substantive rights and liabilities" at issue in the litigation.
Even the purely procedural requirement of stating the reason for
termination of a lease, which was at issue in Thorpe,
affected the substantive right of the landlord to produce an
effective termination of the lease and enforce an eviction. I
suppose it would be possible to distinguish between statutes that
alter "substantive rights and liabilities" directly, and those that
do so only by retroactively adding a procedural requirement, the
failure to comply with which alters the "substantive rights and
liabilities" -- but I fail to see the sense in such a
distinction.
III
What the record shows, therefore is the following: (1) An
unbroken line of precedent, prior to 1969, applying a presumption
that statutes are not retroactive (except for repeal of penal
provisions) in all cases. (2) In 1969, with
Thorpe, a
departure from that tradition (based upon a misreading of our
precedent) for cases in which the statute has been enacted after
initial adjudication. (3) From 1969 to the present, (a) firm
adherence to the prior tradition in cases not involving
Page 494 U. S. 854
postadjudication enactment, and (b) the expression of adherence
to the new presumption in postadjudication-enactment cases, but
with only one case (
Bradley, in 1974) where that probably
produced a difference in outcome, and with one case
(
Bennett, in 1985) where it seemingly should have produced
a difference in outcome but was not permitted to do so.
It is doubtful, on the basis of this record, whether the
Thorpe-Bradley presumption of retroactivity survives at
all. If it does, however, it only survives (as it was begotten) as
a special rule applicable to changes in law after initial
adjudication. That the traditional presumption of nonretroactivity
continues to apply in all other cases is clear from our decisions
in
United States v. Security Industrial Bank, 459 U. S.
70 (1982), and
Georgetown, supra. The
difficulty is, however, that it is quite impossible to apply the
traditional presumption in "enactment-before-adjudication" cases
and the
Thorpe-Bradley presumption in
"enactment-after-adjudication" cases, as a moment's reflection will
make plain. This would mean nonsuiting the plaintiff who has won a
tort judgment that is on appeal when the statute abolishing the
tort is enacted, while rendering judgment in favor of plaintiffs
who sue later for pre-enactment torts. It would be irrational to
produce these results. [
Footnote
2]
Page 494 U. S. 855
In the last analysis, in other words,
Thorpe and
Bradley cannot avoid confronting the vast body of case law
I have described in Part I of this opinion. It is ultimately not a
question of dealing with the narrow category of "cases pending" or
"cases on appeal" when the statute was enacted -- as to which one
might plausibly (though erroneously) say, as
Bradley did,
that "[f]or a very long time, the Court's decisions did little to
clarify this issue." 416 U.S. at
416 U. S. 713.
Rather, it is a question of adopting in all cases, and contrary to
an immense volume of precedent, the presumption that statutes have
retroactive effect. That unthinkable course was rejected, as
recently as last Term, in
Georgetown.
Precedent aside, however, even as an original matter there is
nothing to be said for a presumption of retroactivity -- neither in
the narrow context of "cases pending" or "cases on appeal" nor
(
a fortiori) in the logically compelled broader context of
all cases. It is contrary to fundamental notions of justice, and
thus contrary to realistic assessment of probable legislative
intent. The principle that the legal effect of conduct should
ordinarily be assessed under the law that existed when the conduct
took place has timeless and universal human appeal. It was
recognized by the Greeks,
see 2 P. Vinogradoff, Outlines
of Historical Jurisprudence 139-140 (1922), by the Romans,
see Justinian Code, Book 1, Title 14, § 7, by English
common law,
see 3 H. Bracton, De Legibus et
Consuetudinibus Angliae 531 (T. Twiss trans. 1880); Smead, 20
Minn.L.Rev. at 776-778, and by the Code Napoleon, 1 Code Napoleon,
Prelim. Title, Art. I, cl. 2 (B. Barrett trans. 1811). It has long
been a solid foundation of American law. Chancellor Kent said that
"it cannot be admitted that a statute shall, by any fiction or
relation, have any effect before it was actually passed." 1 J.
Kent, Commentaries on American Law *455. Justice Story said
that
"retrospective laws are . . . generally unjust; and . . .
neither accord with sound legislation nor with the fundamental
principles of the social compact."
J. Story, Commentaries on the
Page 494 U. S. 856
Constitution § 1398 (1851). The United States Constitution
itself so far reflects these sentiments that it proscribes all
retroactive application of punitive law, U.S. Const., Art. I, § 9,
cl. 3,
See Calder v. Bull,
3 Dall. 386 (1798), and prohibits (or requires compensation for)
all retroactive laws that destroy vested rights,
see Hodel v.
Irving, 481 U. S. 704
(1987);
United States Trust Co. of N.Y. v. New Jersey,
431 U. S. 1 (1977).
A provision of the New Hampshire Constitution, adopted in 1784 and
still in effect, states:
"Retrospective laws are highly injurious, oppressive, and
unjust. No such laws, therefore, should be made, either for the
decision of civil causes, or the punishment of offenses."
N.H. Const., Pt. 1, Art. 23. The constitutions of other States
also proscribe retroactive laws,
see, e.g., Colo. Const.,
Art. II, § 11; Mont. Const., Art. XIII, § 1, cl. 3; Ohio Const.,
Art. II, § 28, and the codes of some states contain a provision
specifying that all laws are to be applied prospectively unless a
contrary intent (of varying specificity) appears.
See
e.g., N.Y. Statutes Law § 51b (McKinney 1971) ("unless the
language of the statute either expressly or by necessary
implication requires . . . retroactive construction");
Pa.Stat.Ann., Tit. 46, § 556 (Purdon 1969) ("when clearly and
manifestly so intended by the Legislature"). The presumption of
nonretroactivity, in short, gives effect to enduring notions of
what is fair, and thus accords with what legislators almost always
intend.
The
Thorpe-Bradley rule does the opposite, as the
peculiar preannounced exception to its application makes clear. A
background rule of retroactivity is so patently contrary to
probable legislative intent that it could not possibly be applied
(as the presumption of non retroactivity is applied) whenever there
is no legislative indication to the contrary. So
Thorpe
and
Bradley have invented an all-purpose exception to
their counterintuitive rule: retroactivity will not be assumed
where that will produce "manifest injustice." What that might mean
(
viz., almost anything) is well enough exemplified by
Thorpe. There we did not consider it "manifestly
Page 494 U. S. 857
unjust," on the basis of a federal regulation adopted 18 months
after the fact, to prevent a landlord from evicting a tenant whose
lease had been terminated in full compliance (as we assumed) with
all applicable laws. Is there any doubt that we would have found it
"manifestly unjust" to evict the tenant if the sequence were
reversed -- that is, if the landlord had not complied, at the time
of lease termination, with a regulation repealed 18 months later?
"Manifest injustice," I fear, is just a surrogate for policy
preferences. Indeed, it cannot be otherwise. Once one begins from
the premise of
Thorpe and
Bradley that, contrary
to the wisdom of the ages, it is not in and of itself unjust to
judge action on the basis of a legal rule that was not even in
effect when the action was taken, then one is not really talking
about "justice" at all, but about mercy, or compassion, or social
utility, or whatever other policy motivation might make one favor a
particular result. A rule of law, designed to give statutes the
effect Congress intended, has thus been transformed to a rule of
discretion, giving judges power to expand or contract the effect of
legislative action. We should turn this frog back to a prince as
soon as possible.
* * * *
I do not pretend that clear reaffirmation of the presumption of
nonretroactivity will always make it simple to determine the
application in time of new legislation. It will remain difficult,
in many cases, to decide whether the presumption has been overcome
by text, and indeed to decide whether a particular application is
retroactive. [
Footnote 3] But
however
Page 494 U. S. 858
many obstacles may remain along the route, surely it is
essential to agree upon our point of departure. The
Thorpe-Bradley presumption of retroactivity, which is
arguably formulated to apply to a relatively narrow class of cases
but which logically must be extended across-the-board, misleads
prospective litigants and confuses judges of the lower courts. I
would say that it confuses even Congress itself -- except that I
believe and hope that legislators choose their language with the
assumptions that just men and women normally entertain, rather than
the assumptions derived from consulting the latest decision of this
Court
I would eliminate the confusion of the past two decades and
reaffirm unqualifiedly the principle of construction that reflects
both our long applied jurisprudence and the reality of legislative
intent: A statute is deemed to be effective only for the future
unless contrary intent appears.
[
Footnote 1]
I limit the expression of the rule to nonpenal legislation
because a contrary presumption (
i.e., a presumption of
retroactivity) is applied to the repeal of punishments.
"[I]t has been long settled, on general principles, that after
the expiration or repeal of a law, no penalty can be enforced, nor
punishment inflicted, for violations of the law committed while it
was in force, unless some special provision be made for that
purpose by statute."
Yeaton v. United
States, 5 Cranch 281,
9 U. S. 283
(1809).
See also United States v.
Tynen, 11 Wall. 88,
78 U. S. 95
(1871) ("There can be no legal conviction, nor any valid judgment
pronounced upon conviction, unless the law creating the offence be
at the time in existence"). For convenience' sake, in the remainder
of this opinion, I will generally omit this qualification in my
expression of the rule.
[
Footnote 2]
Perhaps it would be rational to do the opposite -- that is, to
say that acts which have been
initially adjudicated, like
acts which have been
finally adjudicated and thus placed
beyond the reach of the new statute by the doctrine of
res
judicata, will
not be affected by a new law, even
when acts not yet adjudicated
are affected. The
possibility of such special treatment perhaps explains why judges
feel it necessary to discuss cases involving amendment pending
appeal as a separate category: not in order to establish that a
special rule of retroactivity applies to them, but to make
clear that, when the generally applicable presumption of
nonretroactivity has been rebutted by the text of the statute, the
then-ensuing
general retroactivity of the statute will
apply to those cases, just as it does to matters not yet in
litigation.
[
Footnote 3]
The latter difficulty inheres to some degree in the present
case. Arguably it would not be giving retroactive effect to a new
statutory interest rate for judgments if one applied that rate to
all outstanding balances on judgments, with respect to all periods
of time after the statute's effective date -- regardless of when
the judgments were rendered. It depends upon what one considers to
be the determinative event by which retroactivity or prospectivity
is to be calculated. If it is the
entry of judgment, then
only judgments rendered after the effective date will be covered by
prospective application; but if it is the day-by-day assessment of
interest against an owing sum, then judgments rendered before the
effective date will be affected as well, but only with respect to
interest calculated after the effective date. Thus, what is covered
by prospective application would have been a different question in
the present case if the new interest rate set by the statute were a
fixed, flat percentage for the entire term of the judgment debt, or
even a percentage that varied from month to month over the term to
comport with some varying external reference. In fact, however, the
rate here is a fixed percentage for the entire term, calculated on
the basis of the rate provided by a varying external reference
at or near the time of judgment. This suggests to me that
Congress was addressing future judgments, rather than future days
on which interest is owing. The application of the presumption,
like the presumption itself, seeks to ascertain the probable
legislative intent.
Justice WHITE, with whom Justice BRENNAN, Justice MARSHALL, and
Justice BLACKMUN join, dissenting.
The Court today holds that the amended version of the federal
postjudgment interest statute, 28 U.S.C. § 1961 (1982 ed.), does
not apply to a judgment entered before the effective date of the
amendment, even though the litigation was still pending when the
amendment took effect and the District
Page 494 U. S. 859
Court calculated the amount of postjudgment interest long after
the effective date. Because I cannot concur in the Court's decision
denying effect to an important ameliorative federal statute in
precisely the kind of situation demonstrating the need for the
amendment, I respectfully dissent.
I
I begin where the majority does, with the language of § 1961. In
concluding that the plain language of the statute decides this
case, the majority stresses that both versions of § 1961 provide
that the interest due "shall be calculated from the date of the
entry of the judgment."
Ante at
494 U. S. 838
(emphasis omitted). But this clause only fixes the starting point
from which interest is to be allowed; it indicates that § 1961 is
in fact a postjudgment interest statute, not a prejudgment interest
statute (or a postverdict interest statute,
see ante at
494 U. S.
835). This clause does not direct the rate to be applied
to money judgments. That matter is governed by the following clause
of § 1961, requiring that interest be calculated at the Treasury
bill rate settled immediately prior to the date of the
judgment.
The majority's error results from a subtle but significant
misreading of § 1961. The statute, as just noted, states that
interest shall be calculated "from" the entry of the judgment. But
the majority reads § 1961 as if it says that interest shall be
calculated "
at the date of the entry of the judgment" or
"
as if at the date of the entry of judgment." The majority
essentially interprets § 1961 as commanding the district courts to
transport themselves back in time to the judgment date to determine
the rate of postjudgment interest, not because § 1961 directs the
district courts to do so in ascertaining the Treasury bill rate
(which it plainly does), but because § 1961 supposedly requires the
district courts to apply the postjudgment interest
law in
effect at the judgment date.
Page 494 U. S. 860
This is too convoluted a reading of § 1961. [
Footnote 2/1] The Court reaches it because of its
premise that
"on the date of judgment, expectations with respect to interest
liability were fixed, so that the parties could make informed
decisions about the cost and potential benefits of paying the
judgment or seeking appeal."
Ante at
494 U. S. 839.
The Court fears it would be unfair to apply new § 1961 to a
defendant that had already begun the process of challenging a money
judgment because an important element defining the risk of appeal,
the rate of postjudgment interest, changed upon the amendment of §
1961. But putting aside for the moment whether expectations about
interest liability can ever settle before the end of litigation, I
still do not understand why we should not apply new § 1961 to
litigation in progress when we know that the principal reason for
Congress' amendment of § 1961 was to change the risk of
postjudgment litigation. The decision to appeal is not irrevocable.
When new § 1961 took effect, Kaiser's motion for judgment
notwithstanding the verdict was outstanding, and it was certainly
within Kaiser's power then to offer a settlement based on its new
perception of the risk in further proceedings. Kaiser also must
have understood
Page 494 U. S. 861
that Bonjorno would have contemplated an appeal if the District
Court overturned or reduced the jury verdict. Nor was Kaiser unable
to calculate the risk of protracting litigation under new § 1961
when it decided to seek certiorari.
Though the majority never uses the dreaded word, it clearly
wants to say that Kaiser's right to a particular rate of
postjudgment interest "vested" at the date of entry of judgment.
Only the concept of "vestedness" fully explains the link that the
majority makes between Kaiser's "fixed" expectations and its
ability to make "informed" decisions.
Ante at
494 U. S. 839.
The majority overlooks the crucial point that Kaiser's liability
for postjudgment interest could not be settled until the judgment
against Kaiser became final. Until the end of litigation, a
defendant must always evaluate the possibility that a judgment
against it, and concomitantly the postjudgment interest that it
must pay, may be vacated, decreased or increased on appeal, in
postjudgment proceedings before the District Court, or by a
legislated change in the substantive law. (In this case, Kaiser's
disastrous experience with its first attempt to overturn the jury
verdict certainly made it aware of this possibility.) So whereas
application of new § 1961 might have interfered with Kaiser's
vested rights had Kaiser already paid the judgment and interest
calculated under the old version of the statute, its expectations
were not nearly so fixed before the case came to an end. [
Footnote 2/2]
Page 494 U. S. 862
Nor do I agree that the statutory language providing for a
delayed effective date means that "the amended version [of § 1961]
cannot be applied before the effective date."
Ante at
494 U. S. 839.
Amended § 1961 was but one small part of the Federal Courts
Improvement Act of 1982 (FCIA), Pub.L. 97-164, 96 Stat. 25, an
omnibus law effecting significant changes in the administration of
the federal courts, including the abolition of the old Court of
Claims and Court of Customs and Patent Appeals and the creation of
the new United States Claims Court and the United States Court of
Appeals for the Federal Circuit. [
Footnote 2/3] Congress had to establish some date to
mark the end of business for the old courts and the beginning for
the new courts, and that date could not be the date of enactment of
the statute, given the need to provide for court personnel and
facilities.
See, e.g., Pub.L. 97-164, § 121, 96 Stat.
34-35 (authorizing United States Claims Court to appoint clerk, law
clerks, secretaries, bailiffs, and messengers). [
Footnote 2/4]
Page 494 U. S. 863
Moreover, Congress is able to recognize a distinction that has
eluded the majority: the difference between a statute's
taking effect on a certain date, in the sense that its
provisions are not to be applied by a court before that date
passes, and a statute's
having effect only after that
date, in that its provisions may not be applied even to cases
pending at that time. Indeed, Congress appears to have understood
that the courts would presume that the provisions of FCIA would be
applied to pending cases absent legislative direction to the
contrary, because it specifically provided that the jurisdictional
changes in FCIA should not be applied to certain classes of pending
cases. In particular, § 403(e) of FCIA, 96 Stat. 58, provided that
pending cases on appeal from the District Courts to the Courts of
Appeals should remain in the Courts of Appeals to which the appeals
had originally been taken rather than be transferred to the Federal
Circuit, as would have been otherwise required by the
jurisdictional changes in FCIA.
See, e.g., Weisberg v. U.S.
Department of Justice, 246 U.S.App.D.C. 175, 763 F.2d 1436
(1985).
In other statutes, Congress has recognized that there might be a
problem in applying new law to pending cases, and has provided for
those cases expressly. When Congress eliminated most of this
Court's appellate jurisdiction in 1988, it delayed the effective
date of the jurisdictional changes, but it also provided
specifically that those changes should not
"affect the right to review or the manner of reviewing the
judgment or decree of a court which was entered before such
effective date."
Pub.L. 100-352, § 7, 102 Stat. 664. And when Congress recently
increased the jurisdictional amount for diversity cases, it
specifically provided that "[t]he amendments . . . shall apply to
any civil action
commenced on or after the 180th day after
the date of enactment of this title." Pub.L. 100-702, § 201(b), 102
Stat. 4646 (emphasis added).
Page 494 U. S. 864
Congress thus understands that the mere inclusion of a delayed
effective date will not necessarily be understood by the courts as
precluding the application of the new statute to pending cases;
when circumstances have so required, it has gone further and told
the courts not to apply the statutory changes. This is not
surprising, because, as I discuss
infra, at
494 U. S. 868,
absent legislative direction to the contrary or constitutional
objections, federal courts have generally applied statutes to cases
pending at their effective date, particularly if the statutes
govern the administration of the courts.
I do not suggest that a delayed effective date should never
indicate that a statute is not to be applied to pending cases. I
cannot agree, however, that a delayed effective date in a statute
as complex as FCIA, which effected many changes in judicial
administration requiring a transition period and having nothing to
do with postjudgment interest, is particularly instructive about
the temporal operation of new § 1961.
II
Because the plain language of FCIA does not state whether
amended § 1961 is to be applied to cases pending on the statute's
effective date, it is necessary to apply the rules of construction
that the Court has followed for almost two centuries in determining
the temporal operation of federal statutes.
The Court discerns an "apparent tension" between the rule of
Bradley v. Richmond School Bd., 416 U.
S. 696 (1974), and
United States v. Schooner
Peggy, 1 Cranch 103 (1801), requiring application
of intervening statutory changes to pending cases, and the rule of
Bowen v. Georgetown University Hospital, 488 U.
S. 204 (1988), against retroactive application of
statutes.
Ante at
494 U. S. 837. The tension is more apparent than real,
for the rule against retroactivity has little to do with this case.
This case does not involve true retroaction, in the sense of the
application of a change in law to overturn a judicial adjudication
of rights that has already become final.
Page 494 U. S. 865
Cf. Bowen, supra; Chicot County Drainage Dist. v. Baxter
State Bank, 308 U. S. 371
(1940).
Nor would application of amended § 1961 in this case require the
courts to disturb a legal relation to which the parties have
committed themselves, or that they have otherwise reached, in
reliance on the state of the law prior to the amendment. Thus this
case is unlike
Claridge Apartments Co. v. Commissioner,
323 U. S. 141
(1944). There the Government unsuccessfully argued for retroactive
application of the 1938 Chandler Act, a bankruptcy statute that
required the reduction of the basis of property transferred in the
acquisition of an insolvent corporation to the fair market value of
the property at the date of confirmation of a reorganization plan.
At the time of the acquisition of the property involved in
Claridge Apartments, the tax laws provided that the basis
to the transferee would be the same as the (higher) adjusted basis
in the hands of the transferor corporation.
Id., 323 U.S.
at
323 U. S. 143,
n. 2. Further, reorganization proceedings involving the transferor
had closed before the Chandler Act became effective. In concluding
that Congress intended the Chandler Act to apply only to
reorganization proceedings pending on its effective date, the Court
stressed that the Government's construction would make the Chandler
Act actually retroactive, in that it would require recalculation of
definitely settled tax liabilities for past years. "Congress was
not uprooting the whole tax past of reorganized debtors and their
creditors."
Id. at
323 U. S. 156.
[
Footnote 2/5] No such uprooting is
possible here; when amended § 196l took effect, the parties were
still contesting their obligations to
Page 494 U. S. 866
each other. Application of amended § 1961 here does not require
"altering the past legal consequences of past actions."
Bowen,
supra, at
488 U. S. 219
(SCALIA, J., concurring) .
What is even more important for present purposes is that, in
Claridge Apartments, the Court also rejected the Tax
Court's view that the Chandler Act did not apply to all tax years
at issue in any reorganization proceedings pending at the statute's
enactment, but only to 1938 and later tax years. Remarking that
"the whole problem . . . was to give the Chandler Act as wide
room as possible for future operation, notwithstanding the previous
vesting of substantive rights or institution of bankruptcy or
reorganization proceedings,"
323 U.S. at
323 U. S.
157-158, the Court had little difficulty in concluding
that the changes in the tax laws applied even to reorganization
"plans already confirmed in pending proceedings."
Id. at
323 U. S. 158.
The Court ordered application of the Chandler Act even to past tax
years as long as the past tax liability was relevant to the ongoing
reorganization of a debtor corporation. The Court then stated the
relevant rule of construction that should be applied today:
"It is the normal and usual function of legislation to
discriminate between closed transactions and future ones or others
pending but not completed."
Id. at
323 U. S. 164.
Not only is it the normal and usual function of legislation to so
discriminate; it is our obligation to do so as well, to give
congressional policy as declared in federal statutes the widest
application consistent with constitutional guarantees.
The evolution of the presumption in favor of application of new
laws to pending cases was comprehensively reviewed in
Bradley,
supra, 416 U.S. at
416 U. S.
711-715. It is a rule that we have applied with
consistency. By this I do not mean that we have applied it
mechanically. As with all choice-of-law rules, the
Bradley
rule requires evaluation of the implicated interests. Thus we
cautioned in
Bradley that neither that decision nor prior
ones purported "to hold that courts must always thus apply new laws
to pending cases in the absence of clear legislative
Page 494 U. S. 867
direction to the contrary," 416 U.S. at
416 U. S. 715,
and we discussed at length the conditions that might counsel
against application of a new statute to a pending case.
Id. at
416 U. S.
717-721. But this is not a difficult case if the
teachings of
Bradley are observed.
Bradley noted that the concerns expressed in prior
cases
"relative to the possible working of an injustice [by applying a
new statute] center upon (a) the nature and identity of the
parties, (b) the nature of their rights, and (c) the nature of the
impact of the change in law upon those rights."
Id. at
416 U. S. 717.
As for the nature and identity of the parties here, it is true that
this lawsuit is between private parties. But as
Bradley
makes clear, our analysis must be more discerning than just
distinguishing between private and public entities; we must also
look to the public interests implicated by the statutory change as
well as the lawsuit itself.
Id. at
416 U. S.
718-719. [
Footnote 2/6]
Congress enacted amended § 1961 as part of a comprehensive reform
of the federal courts, and designed new § 1961 itself as an
essential counterweight to the normal incentives
Page 494 U. S. 868
for delay in litigation. Our readiness to apply new statutes to
pending cases has arguably been at its peak when the statutes
involved the administration or jurisdiction of the federal courts.
See Bradley, supra; Andrus v. Charlestone Stone Products
Co., 436 U. S. 604,
436 U. S.
607-608, n. 6 (1978);
United States v. Alabama,
362 U. S. 602
(1960) (per curiam );
Dickinson Industrial Site, Inc. v.
Cowan, 309 U. S. 382
(1940).
As for the nature of the rights, it is here that my disagreement
with the majority is the sharpest. Much significance is ascribed to
Kaiser's purportedly fixed expectations about the rate of
postjudgment interest,
see ante at
494 U. S.
839-840, but these expectations deserve little credit,
for Kaiser was not entitled to assume much of anything about its
interest rate. Postjudgment interest "rests solely upon statutory
provision,"
Pierce v. United States, 255 U.
S. 398,
255 U. S. 406
(1921), [
Footnote 2/7] and both
parties were on notice that Congress could alter the applicable
interest rate if it wished. Furthermore, unlike the right to wages
for services rendered, the right to postjudgment interest does not
"vest" in discrete amounts as each day passes. The amount of
postjudgment interest that a party will recover (or be required to
pay) can never be known with certainty until the amount of the
underlying judgment is known with certainty, and that amount in
turn cannot be definitively ascertained until the process of appeal
is completed. Indeed, Bonjorno's right to postjudgment interest
would have evaporated had the Court of Appeals reversed its
judgment against Kaiser. Thus one cannot speak meaningfully of a
"matured" right to postjudgment interest before the amount of the
judgment is finally established. [
Footnote 2/8]
Page 494 U. S. 869
Bradley last requires us to consider
"the nature of the impact of the change in law upon existing
rights, or, to state it another way, . . . the possibility that new
and unanticipated obligations may be imposed upon a party without
notice or opportunity to be heard."
416 U.S. at
416 U. S. 720.
There is no claim here that Kaiser was unaware that its obligation
for postjudgment interest could be altered during the pendency of
litigation.
Cf. Brinkerhoff-Faris Trust & Savings Co. v.
Hill, 281 U. S. 673
(1930). And Kaiser could have protected itself from fluctuation of
the postjudgment interest rate by depositing the amount of the
judgment with the District Court.
See Fed.Rule Civ.Proc.
67. Nor did the amendment of § 1961 create a new substantive cause
of action or eliminate a substantive defense in a way that would
cause hardship to Kaiser.
Cf. Union Pacific R. Co. v. Laramie
Stock Yards Co., 231 U. S. 190
(1913).
Finally, a more general word must be said about the element of
"manifest injustice" that
Bradley addressed. It is
difficult to see how manifest injustice could be worked except by
refusing to apply amended § 1961 to this case. As a result of the
Court's decision today, Bonjorno is remitted to a postjudgment
interest rate greatly lower than its cost of money during the
pendency of the litigation, while Kaiser, an adjudicated violator
of the antitrust laws, is permitted to escape the consequences of
protracting litigation. This was precisely the result that Congress
intended to prevent by amending § 1961.
Page 494 U. S. 870
III
I agree with the majority that the plain language of § 1961
compels us to conclude that postjudgment interest runs from the
date of the entry of judgment, not the date of a jury verdict.
Ante at
494 U. S.
835.
I also agree with the majority that postjudgment interest in
this case did not begin to accrue upon entry of the August 22,
1979, judgment. Because the District Court's subsequent grant of a
new trial was never overturned, we must accept the District Court's
determination that the August 22, 1979, judgment on damages was not
supported by the evidence, and that damages were not ascertained
until the December 2, 1981, verdict. The Court's holding is
necessarily limited to the facts of this case. The majority does
not state whether August 22, 1979, would have been the proper
commencement date for accrual of postjudgment interest had Bonjorno
successfully appealed the order granting a new trial. [
Footnote 2/9]
Cf. Turner v. Japan
Lines, Ltd., 702 F.2d 752 (CA9 1983). Nor does the Court state
any rule applicable to various other fact patterns not before us
but commonly encountered by the lower courts,
e.g., where
the district court correctly ascertains total damages but
improperly apportions them among the parties,
Brooks v. United
States, 757 F.2d 734 (CA5 1985),
Page 494 U. S. 871
or where a judgment entered after a second trial necessarily
cannot include interest accrued after the end of the first trial,
Handgards, Inc. v. Ethicon, Inc., 743 F.2d 1282 (CA9
1984),
cert. denied, 469 U.S. 1190 (1985), or where an
interest award is reduced on appeal and a new judgment is entered
on remand,
Perkins v. Standard Oil Co. of Cal., 487 F.2d
672 (CA9 1973).
I respectfully dissent.
[
Footnote 2/1]
To demonstrate why the Court's reading is implausible, one need
only imagine a situation that might have arisen under the old
version of § 1961. Under old § 1961, postjudgment interest was to
be "calculated from the date of the entry of the judgment, at the
rate allowed by State law." 28 U.S.C. § 1961 (1976 ed.). But what
would have happened if, between the entry of judgment and the end
of the litigation (or the calculation of postjudgment interest),
the State had raised or lowered its legal rate of interest, or had
abolished postjudgment interest altogether? Under the Court's
reasoning, I take it, the federal courts would have been required
under the plain language of § 1961 to apply the State's legal rate
of interest in effect at the date of entry of judgment, even if the
new state law expressly provided that it was to be applied to
judgments entered prior to the effective date. This might
contravene the Rules of Decision Act, 28 U.S.C. § 1652 (1982 ed.),
which requires federal courts to follow state law in determining
whether a state statute is operative.
Cf. Commissioners of
Wicomico County v. Bancroft, 203 U. S. 112,
203 U. S. 118
(1906);
Town of South Ottawa v. Perkins, 94 U. S.
260,
94 U. S. 267
(1877).
[
Footnote 2/2]
This Court has held that the Contract Clause and Due Process
Clause do not prevent legislatures from altering the statutory rate
of postjudgment interest applicable to judgments that have not been
satisfied.
See Missouri & Arkansas Lumber & Mining Co.
v. Greenwood Dist. of Sebastian County, Ark., 249 U.
S. 170 (1919);
Morley v. Lake Shore & Michigan
& Southern R. Co., 146 U. S. 162
(1892);
cf. Funkhouser v. J.B. Preston Co., 290 U.
S. 163 (1933);
League v. Telas, 184 U.
S. 156,
184 U. S. 161
(1902). The Court does not say that it casts any doubt on these
decisions. However, if the Court is correct that Kaiser's
expectations about the rate of postjudgment interest truly became
fixed upon entry of judgment, Congress might not have had the power
to alter that rate even as to interest that accrued after the
effective date of new § 1961.
See Morley, supra, 146 U.S.
at
146 U. S. 176
(Harlan, J., dissenting) (making this point). Kaiser might have had
a constitutionally protected property right in the earlier
postjudgment interest rate.
Cf. Logan v. Zimmerman Brush
Co., 455 U. S. 422
(1982). When, in
Morley, Justice Harlan argued that a
plaintiff's right to New York's statutory rate of postjudgment
interest had vested before the repeal of the interest statute, he
stressed words in the old New York statute very similar to the
words of § 1961 emphasized by the majority today, that every
judgment should bear interest "
from the time when it is
entered'" 146 U.S. at
146 U. S. 172 (emphasis added). Of course, Justice
Harlan's argument was rejected by the Court.
[
Footnote 2/3]
The effective date provision was § 402 of FCIA, Pub.L 97-164,
and was located in Title IV of that statute, labeled "Miscellaneous
Provisions."
See 96 Stat. 56-57. The postjudgment interest
statute was amended by § 302 of FCIA, contained in a separate title
governing "Jurisdiction and Procedure."
See 96 Stat.
55-56.
[
Footnote 2/4]
Congress may delay the effective date of a statute for many
reasons having nothing to do with retroactivity, particularly if
the statute is complex. For example, most parts of the Education
Amendments of 1972, Pub.L 92-318, 86 Stat. 235, took effect on July
1, 1972, eight days after enactment. Congress evidently delayed the
effective date to conform the statute, which included
appropriations provisions, to the federal fiscal year.
See
§ 2(c)(1), 86 Stat. 236. Among the provisions with a delayed
effective date was § 718, which authorized the award of attorney's
fees in school desegregation litigation. This was the provision we
held applicable to pending cases in
Bradley v. Richmond School
Bd., 416 U. S. 696
(1974)
[
Footnote 2/5]
For cases to similar effect,
see Miller v. United
States, 294 U. S. 435
(1935), where a 1930 regulation permitting recovery on war risk
insurance for loss of a hand and an eye was not construed
retroactively to allow recovery on an insurance policy that lapsed
in 1919 for an injury sustained in 1918, and
Union Pacific R.
Co. v. Laramie Stock Yards Co., 231 U.
S. 190 (1913), where a 1912 statute was not construed
retroactively so as to recognize adverse possession against a
railroad company, which under the prior statute had been immune
from adverse possession claims.
[
Footnote 2/6]
Notwithstanding Chief Justice Marshall's remark that courts
particularly resist application of newly enacted statutes "in mere
private cases between individuals,"
United
States v. Schooner Peggy, 1 Cranch 103,
5 U. S. 110 (1801),
some cases that have declined to apply newly enacted statutes have
involved controversies between private parties and the Government,
where the change in law would prejudice the rights of the private
party and where there was a suggestion that the Government was
using the change in law to disadvantage the private party unfairly.
See, e.g., Greene v. United States, 376 U.
S. 149 (1964), which was similar to early cases such as
the
Twenty Per Cent.
Cases, 20 Wall. 179 (1874), and
United
States v. Heth, 3 Cranch 399 (1806), in that it
involved an attempt by the Government to evade an obligation to its
employees that had plainly accrued under prior law.
Cf. Lynch
v. United States, 292 U. S. 571
(1934). Yet we have not hesitated to apply new federal statutes or
regulations when the change in law was part of an important federal
regulatory scheme, even in cases involving governmental entities.
See, e.g., Bradley v. Richmond School Bd., 416 U.
S. 696 (1974);
Thorpe v. Durham Housing
Authority, 393 U. S. 268
(1969);
Reynolds v. United States, 292 U.
S. 443 (1934).
[
Footnote 2/7]
For the same reason, I do agree with the majority that federal
courts have no discretion to award postjudgment interest at a rate
higher than that prescribed by statute.
Ante at
494 U. S. 840.
Texas v. New Mexico, 482 U. S. 124,
482 U. S.
132-133, n. 8 (1987), is distinguishable because the
case arose under our original jurisdiction.
[
Footnote 2/8]
Reynolds v. United States, 292 U.
S. 443 (1934), was analytically similar to this case.
There a veteran argued that the hospital for the insane where he
was committed was precluded from deducting amounts for room and
board from his war pension, which had been paid to the hospital by
the Government during his confinement. Congress had passed a
statute to that effect during his confinement. The Court held that
the statute precluded the hospital from deducting even amounts
allocable to the veteran's confinement before the passage of the
statute, because, on the facts of the case,
"[t]he liability for board arose from
continuous
charges, beginning before the proviso was passed and ending at
the time of petitioner's discharge."
Id. at
292 U. S. 448
(emphasis added). This case is therefore more like
Reynolds than the
Twenty Per Cent. Cases, n. 6,
supra, in which the Government owed its employees money
for services already rendered and completed.
[
Footnote 2/9]
Bonjorno of course could not challenge the District Court's
order granting a new trial on damages until after the retrial,
see, e.g., Juneau Square Corp. v. First Wisconsin National Bank
of Milwaukee, 624 F.2d 798, 806 (CA7),
cert. denied,
449 U.S. 1013 (1980), and had little incentive to challenge that
order after the second trial, given the much more favorable outcome
of the retrial. In many cases, however, a party appealing a
judgment entered after a new trial will prefer the outcome of the
first trial and will argue that the first verdict should be
reinstated.