Dana Holding Corp., Aplt. v. WCAB (Smuck) ( 2020 )

[J-95-2019]
IN THE SUPREME COURT OF PENNSYLVANIA
MIDDLE DISTRICT
SAYLOR, C.J., BAER, TODD, DONOHUE, DOUGHERTY, WECHT, MUNDY, JJ.
DANA HOLDING CORPORATION, : No. 44 MAP 2019
:
Appellant : Appeal from the Order of the
: Commonwealth Court at No. 1869 CD
: 2017 dated 10/11/18 affirming the order
v. : of the Workers’ Compensation Appeal
: Board at No. A16-1266 dated 11/28/17
:
WORKERS’ COMPENSATION APPEAL :
BOARD (SMUCK), :
:
Appellees : ARGUED: November 19, 2019
OPINION
CHIEF JUSTICE SAYLOR DECIDED: June 16, 2020
In Protz v. Workers’ Compensation Appeal Board (Derry Area School District),
639 Pa. 645, 161 A.3d 827 (2017), this Court recently ruled that a statutory regime per
which the duration of workers’ compensation benefits could be curtailed was invalid,
since integral terms of the enactment yielded an unconstitutional delegation of
legislative power. The present case concerns the retroactive application of this holding
to a scenario in which the pertinent constitutional challenge to the statute was advanced
during the course of direct appellate review.
In 1996, in response to the rising costs of the workers’ compensation liability
scheme in Pennsylvania, the General Assembly promulgated an impairment rating
scheme, reposed in Section 306(a.2) of the Workers’ Compensation Act, 1 77 P.S.
§511.2. See I.A. Constr. Corp. v. WCAB (Rhodes), 635 Pa. 551, 553, 139 A.3d 154,
155 (2016). Under the statute, insurers were required to request an impairment rating
evaluation -- or an “IRE” -- after a workers’ compensation claimant had received total
disability benefits for a period of 104 weeks. See 77 P.S. §511.2(1) (repealed).
“Impairment,” in this setting, connoted an anatomic or functional abnormality or loss
resulting from a compensable injury that was reasonably presumed to be permanent,
see id. §511.2(8)(i), as distinguished from “disability,” which more directly concerns the
loss of earnings capacity.2
When a claimant received an impairment rating of less than 50 percent, the
designation of his disability was converted from total to partial, thereby limiting the
insurer’s otherwise continuing liability to benefits payable throughout a maximum,
closed-ended period of 500 weeks. See 77 P.S. §511.2(7). Accordingly,
one main purport of the statute [was] that a claimant whose
condition may continue to meet the conventional definition of
total “disability” -- a concept centered on overall earnings
capacity encompassing both physical capacity and job
availability -- may nevertheless be limited in the time frame
during which he or she may receive workers’ compensation
benefits.
I.A. Constr., 635 Pa. at 554, 139 A.3d at 155; see also Diehl, 607 Pa. at 280, 5 A.3d at
246 (explaining that an employer/insurer was not required to produce evidence of
1 Act of June 2, 1915, P.L. 736 (as amended 77 P.S. §§1-1041.1, 2501-2626) (the
“WCA” or the “Act”).
2 See Dillon v. WCAB (Greenwich Collieries), 536 Pa. 490, 501, 640 A.2d 386, 392
(1994) (explaining that the concept of “disability” under the WCA encompasses both the
capacity to work and job availability). See generally Diehl v. WCAB (I.A. Constr.), 607
Pa. 254, 277-79, 5 A.3d 230, 244-45 (2010) (elaborating upon the distinction between
impairment and disability).
[J-95-2019][M.O. – Saylor, C.J.] - 2
earning power or job availability to support conversion of a disability designation from
total to partial under Section 306(a.2), based on an effective impairment rating of less
than 50 percent). See generally DAVID B. TORREY & ANDREW E. GREENBERG, 6 W EST’S
PA. PRACTICE SERIES, WORKERS’ COMPENSATION: LAW AND PRACTICE §6:41 (3d ed. 2008)
(“[T]he 500 weeks provides a horizon with regard to the claimant’s entitlement and the
employer’s liability.”).
Significantly, under Section 306(a.2), impairment ratings were to be determined
“pursuant to the most recent edition of the American Medical Association ‘Guides to the
Evaluation of Permanent Impairment,’” 77 P.S. §511.2(1) (emphasis added), hereinafter
referred to as the “Guides.” However, in Protz, this Court ruled that this prescription
entailed an unconstitutional delegation of lawmaking authority from the Legislature to
the American Medical Association. See Protz, 639 Pa. at 663, 161 A.3d at 838 (relying
upon the mandate of Article II, Section 1 of the Pennsylvania Constitution that “[t]he
legislative power of this Commonwealth shall be vested in a General Assembly, which
shall consist of a Senate and a House of Representatives.”). The Court explained that
reliance on that private association’s normative judgments was impermissible, at least
insofar as the Legislature had not provided any standards by which impairment ratings
should be assessed or procedural mechanisms to ensure fairness in the determination
whether a claimant’s disability benefits should cease after 500 weeks. See id. at 659-
60, 161 A.3d at 835-36. Given that this unconstitutional delegation could not be
rationally severed from the balance of the statute, Section 306(a.2) was ultimately
deemed to be invalid in its entirety. See id. at 667-68, 161 A.3d at 841.
In 2000, Appellee David Smuck (“Claimant”) suffered a work-related back injury,
for which he received total disability benefits since 2003. Appellant Dana Holding
Corporation (“Employer”) requested an IRE pursuant to the then-extant impairment
[J-95-2019][M.O. – Saylor, C.J.] - 3
rating regime embodied in Section 306(a.2). In June 2014, Claimant submitted to the
IRE and was assigned a whole-body impairment rating of 11 percent, based on the
Sixth Edition of the Guides, which was the most recent version. Employer then filed a
modification petition seeking to convert Claimant’s disability status from total to partial,
thus limiting the term of Claimant’s disability benefits. See 77 P.S. §§511.2(5) & (7). In
response, Claimant filed a review petition challenging the modification on the basis that
he hadn’t reached maximum medical improvement, and the matter was presented to a
workers’ compensation judge (the “WCJ”).
Procedural complexities ensued in light of the Commonwealth Court’s intervening
decision in Protz. See Protz v. WCAB (Derry Area Sch. Dist.), 124 A.3d 406 (Pa.
Cmwlth. 2015), aff’d in part and rev’d in part, 639 Pa. 645, 668, 161 A.3d 827.
Ultimately, the WCJ credited Employer’s position on modification, thus yielding a
change in disability status from total to partial, effective as of June 2014. See Smuck v.
Dana Holding Corp., DSP-7357035-1, slip op. at 10 (DLI, Lancaster Field Office Nov. 1,
2016).
Claimant appealed to the Workers’ Compensation Appeal Board (the “WCAB” or
the “Board”), and the proceedings before the Board were stayed at Employer’s behest
pending this Court’s decision in Protz. Upon the issuance of that opinion, the Board
reversed the WCJ’s order, since the judge had relied upon Section 306(a.2)’s
procedures, which this Court had found to be invalid. Accordingly, Claimant’s total
disability status was reinstated as of the date of the disputed IRE. See Smuck v. Dana
Holding Corp., No. A16-1266, slip op. at 3-4 (WCAB Nov. 28, 2017).
An appeal was lodged by Employer in the Commonwealth Court, which affirmed,
holding that Protz applies at least to all cases in which the underlying IRE was actively
being litigated when the decision was issued. See Dana Holding Corp. v. WCAB
[J-95-2019][M.O. – Saylor, C.J.] - 4
(Smuck), 195 A.3d 635, 643 (Pa. Cmwlth. 2018). Responding to Employer’s position
that the WCAB should not have applied Protz retroactively, the intermediate court first
referenced the general rule that appellate courts apply the law in effect at the time of
appellate review. See id. at 641 (citing Passarello v. Grumbine, 624 Pa. 564, 601, 87
A.3d 285, 307 (2014), and Blackwell v. SEC, 527 Pa. 172, 182, 589 A.2d 1094, 1099
(1991)). The court cautioned, however, that this approach should not be applied rotely
and explained that, ultimately, “[w]hether a judicial decision should apply retroactively is
a matter of judicial discretion to be decided on a case-by-case basis.” Id. (quoting
Passarello, 624 Pa. at 601, 87 A.3d at 307).
Notably, this Court has specified that a threshold inquiry in retroactivity analysis
is whether or not a new rule of law has been announced. See, e.g., Cleveland v. Johns-
Manville Corp., 547 Pa. 402, 413, 690 A.2d 1146, 1152 (1997). Here, the
Commonwealth Court appears to have assumed that Protz announced a new rule,
presumably because both parties to the appeal agreed as such. See Brief for Petitioner
in Dana Holding Corp. v. WCAB (Smuck), 1869 C.D. 2017 (Pa. Cmwlth.), at 25; Brief for
Respondent in Dana Holding, 1869 C.D. 2017, at 4.
The Commonwealth Court next related that the governing retroactivity analysis --
upon discernment of a new rule -- requires consideration of whether:
(1) the purpose to be served by the new rule, (2) the extent
of the reliance on the old rule, and (3) the effect on the
administration of justice by the retroactive application of the
new rule.
Dana Holding, 195 A.3d at 641 (quoting Blackwell, 527 Pa. at 183, 589 A.2d at 1099,
which relied for this proposition on Desist v. U.S., 394 U.S. 244, 249, 89 S. Ct. 1030,
1033 (1969), overruled for purposes of new federal rules in Griffith v. Kentucky, 479
U.S. 314, 322, 107 S. Ct. 708, 712 (1987), and Stovall v. Denno, 388 U.S. 293, 297, 87
[J-95-2019][M.O. – Saylor, C.J.] - 5
S. Ct. 1967, 1970 (1967) (same)).3 In terms of purpose, the court noted the parties’
agreement that the object of Protz was to vindicate the requirements of the
Pennsylvania Constitution. See Dana Holding, 195 A.3d at 641.
Regarding the second factor -- reliance -- the Commonwealth Court related that it
was cognizant of Employer’s argument that hundreds of thousands of claims had been
managed by the business and insurance industries under Section 306(a.2); many of
these were considered to be final and closed; and the company had forewent the
opportunity to pursue other, more traditional avenues to challenge Claimant’s disability
status. Nevertheless, the intermediate court found these concerns to be unpersuasive,
emphasizing instead that, in Claimant’s case, the determination of his disability status
was still being actively litigated when the Protz decisions were handed down. See id.
Additionally, the court opined that the risk of choosing the IRE mechanism over
traditional avenues for modification was properly allocated to Employer. See id. at 642.
In this respect, the court stressed the Act’s remedial nature. See id. (citing Reifsnyder
v. WCAB (Dana Corp.), 584 Pa. 341, 348, 883 A.2d 537, 541 (2005)).
In terms of the third factor, the impact upon the administration of justice, the
Commonwealth Court again deflected Employer’s arguments concerning negative
consequences flowing from a full retroactive effect -- encompassing relitigation of
matters otherwise thought to be final -- by reiterating that the present case simply was
3 Blackwell also discussed a similar set of factors delineated in Chevron Oil Company v.
Huson, 404 U.S. 97, 106-07, 92 S. Ct. 349, 355 (1971), overruled for purposes of new
federal rules in Harper v. Va. Dep’t of Taxation, 509 U.S. 86, 97-98, 113 S. Ct. 2510,
2518 (1993). The Commonwealth Court, however, limited its discussion to the factors
deriving from Desist and Stovall, see Dana Holding, 195 A.3d at 641-42, which in turn
were premised on Linkletter v. Walker, 381 U.S. 618, 85 S. Ct. 1731 (1965), overruled
for purposes of new federal rules in Griffith, 479 U.S. at 322, 107 S. Ct. at 712. The
interrelationship between the various factors delineated in these cases is discussed
below.
[J-95-2019][M.O. – Saylor, C.J.] - 6
not final. See id. (“We examine each case before us, and in this case, the issue of the
IRE process was pending before the Board when [Protz] was decided.”). For the same
reason -- i.e., the fact that the contest over the validity of the IRE in Claimant’s case
remained ongoing -- the intermediate court rejected Employer’s claim to a vested right
deriving from Section 306(a.2), and concomitantly, a contention by the company that it
should at least receive a credit for three years of temporary disability, from the date of
the IRE in June 2014 to the decision in Protz of June 2017.4
The Commonwealth Court then turned to Employer’s argument that retroactive
application of Protz violated its constitutional right, under Article I, Section 11 of the
Pennsylvania Constitution, to due course of law. Generally, the intermediate court
explained, due course of law is most frequently relevant when the Legislature acts to
alter or eliminate a vested or accrued cause of action. See Dana Holding, 195 A.3d at
643 (citing Konidaris v. Portnoff Law Assocs., Ltd., 598 Pa. 55, 71, 953 A.2d 1231, 1240
(2008)). In all events, the court observed that, to implicate the constitutional provision,
the entitlement in issue must be a vested one. See id. at 644 (citing, inter alia,
Konidaris, 598 Pa. at 74, 953 A.2d at 1242). A vested right, the court continued, is
“something more than a mere expectation, based upon an anticipated continuance of
existing law. It must have become a title, legal or equitable, to the present or future
enforcement of a demand, or a legal exemption from a demand made by another.” Id.
(quoting Konidaris, 598 Pa. at 74, 953 A.2d at 1242 (citation omitted)).
4 In this respect, it is noteworthy that, after Section 306(a.2) was invalidated in Protz, it
was replaced by Section 306(a.3) of the Act, which tracks its predecessor statute in
relevant respects, except that it specifically directs the use of the Sixth Edition of the
Guides in impairment rating evaluations. See 77 P.S. §511.3 (2018). Thus, Employer
asked (and asks) that the effect of IREs obtained under the provisions of Section
306(a.2) -- although those terms have been deemed invalid -- should nevertheless be
partially recognized for other purposes, including any later impairment rating
assessment under Section 306(a.3).
[J-95-2019][M.O. – Saylor, C.J.] - 7
In this regard, the Commonwealth Court found that Employer had no reasonable
expectation that the IRE would be upheld, much less a vested right, since Claimant’s
disability status remained subject to continuing litigation. See id. Moreover, the
intermediate court discerned no involvement of due course of law in scenarios in which
a statute is found to be unconstitutional. See id. (“[A] party should not be able to claim
that its constitutional right to the due course of law is being violated and that it should be
able to continue to benefit from an unconstitutional law to the detriment of another party
whose rights were affected by that unconstitutional law.”).5
Upon Employer’s petition, we granted discretionary review to consider the
following questions:
Whether the Commonwealth Court erred in applying the
[Protz] standard to the case on appeal at the time of this
Court’s decision retroactive to the date of the IRE instead of
as of the date as of [sic] the Supreme Court changed the
law?
Whether the Commonwealth Court’s failure to grant the
employer credit for the three year period between the date of
the IRE evaluation and the date of this Court’s decision in
[Protz] unlawfully violates Employer’s constitutional right
5 The Commonwealth Court also rejected Employer’s claim that Claimant had waived
any entitlement to challenge the application of Section 306(a.2) on non-delegation
grounds. See Dana Holding, 195 A.3d at 645-47. Employer does not presently
challenge the intermediate court’s decision in this regard. Indeed, Employer appears to
accept that the court’s waiver ruling was correct to the extent that such ruling was based
on Pennsylvania Rule of Appellate Procedure 1551 and Section 703(a) of the
Administrative Law and Procedure Code. See Brief for Appellant at 27 n.7; see also
Pa.R.A.P. 1551(a) (excepting “[q]uestions involving the validity of a statute” from the
general prohibition against consideration, upon judicial review of quasi-judicial orders, of
issues not raised before the government unit); 2 Pa.C.S. §703(a) (same); Lehman v.
PSP, 576 Pa. 365, 382, 839 A.2d 265, 276 (2003) (observing under Section 703(a),
“claims questioning the [facial] validity of a statute . . . need not be raised before the
administrative agency to be preserved for appellate review”).
[J-95-2019][M.O. – Saylor, C.J.] - 8
pursuant to the “Due Course of Law” provisions of the
Pennsylvania Constitution Article I, Section 11?
Dana Holding Corp. v. WCAB (Smuck), ___ Pa. ___, 208 A.3d 461 (2019) (per curiam)
(emphasis added).
I.
A. Scope of the First Issue
According to its explicit terms, the lead issue presented concerns the application
of Protz “to the case on appeal at the time of this Court’s decision.” Id. Initially, we
observe that Employer’s present arguments, and that of the amici, materially transcend
this issue, the Commonwealth Court’s specific holding, and the circumstances now
before the Court.6 For example, deeply interwoven into Employer’s argument
throughout its brief are policy arguments militating against retroactive application of
Protz to cases in which specific IRE determinations had been fully litigated prior to that
decision’s issuance.7 Claimant, on the other hand, argues strenuously that “[t]he issue
6The amici supporting Employer’s position are the Pennsylvania Chamber of Business
and Industry, the National Federation of Independent Business, and LeadingAge PA,
which submitted a combined brief. The Pennsylvania Association for Justice has filed
an amicus brief supporting Claimant.
7 See, e.g., Brief for Appellant at 15 (“Application of [Protz] back to the date of the
impairment rating evaluation potentially would result in a monumental flood of petitions
to reinstate total disability benefits to all claimants who were not barred by the statute of
repose in Section 413(a) of the Act.”); id. at 30 (“Employers and insurers have litigated
or managed tens of thousands of claims in reliance on the now-stricken statutory
language.”); id. (“[I]f this Court were to impose full retroactivity of the [Protz] holding to
the date of the examination, the outcome would culminate in an overwhelming burden
on the administrative and judicial systems[.]”); id. at 44 (“The significant reach and
magnitude of impact upon tens of thousands of disability status determinations compels
the conclusion that . . . the holding in [Protz] should be applied prospectively only[.]”); id.
at 51 (alluding to a potential “effort by the Courts to revive closed claims via retroactive
application” of Protz).
[J-95-2019][M.O. – Saylor, C.J.] - 9
on appeal is limited ONLY to cases that were pending on direct appeal at the time
[Protz] was determined and where constitutionality was appropriately raised.” Brief for
Appellee at 19 (emphasis in original); see also id. at 16 -17 & n.6, 22-23.
We agree with Claimant’s position on this matter. As previously explained, the
Commonwealth Court’s holding was carefully limited only to cases in which the non-
delegation challenge was raised during the course of ongoing litigation over an IRE
determination. Indeed, the court took great pains to emphasize the demarcation, as
follows:
We reiterate that our holding is limited to cases, such as this,
where the underlying IRE was still being actively litigated
when [Protz] was issued. The extent to which [Protz] may
be retroactively applied to another factual scenario is not
currently before us.
Dana Holding, 195 A.3d at 642 n.9. Concomitantly, the pertinent issue accepted for
review by this Court is framed in terms of the application of Protz to “the case on appeal
at the time of this Court’s decision [in Protz].” Dana Holding, ___ Pa. at ___, 208 A.3d
at 461.
Significantly, this Court has explained that, “[t]he adjudicatory process is
structured to cast a narrow focus on matters framed by litigants before the Court in a
highly directed fashion,” Official Comm. of Unsecured Creditors of Allegheny Health
Educ. & Research Found. v. PriceWaterhouseCoopers, LLP, 605 Pa. 269, 301, 989
A.2d 313, 333 (2010), and that the holding of a judicial opinion is to be interpreted with
reference to its facts. See Maloney v. Valley Med. Facilities, Inc., 603 Pa. 399, 415, 984
A.2d 478, 488 (2009). Accord Charles W. Rhodes, Loving Retroactivity, 45 FLA. ST.
U.L. REV. 383, 404 (2018) (“The traditional and ongoing institutional function of the
judiciary is resolving actual disputes between litigants in an adversary context impacting
the rights and obligations of the litigating parties.”). Quite clearly, different ranges of
[J-95-2019][M.O. – Saylor, C.J.] - 10
policy considerations pertain to vindicating constitutional challenges raised and
preserved in continuing litigation, versus applying new constitutional rulings to cases
that have become final (or in which the usually appropriate time period allowed for
raising constitutional challenges to a particular ruling has otherwise passed). Only the
former set of circumstances was addressed by the Commonwealth Court and is
presently before this Court.8
8 Certainly the direction this Court has taken is to enforce procedural requirements such
as case-specific issue preservation as a prerequisite to the application of a new rule.
See, e.g., Commonwealth v. Hays, ___ Pa. __, ___, 218 A.3d 1260, 1266-67 (2019);
accord Blackwell, 527 Pa. at 188, 589 A.2d at 1102 (foreclosing retroactive application
of a judicial decision finding a constitutional defect in a statute to “transactions . . . which
are now final”). However, the circumstances associated with retroactive application of
Protz to cases in which the non-delegation issue was not raised during the litigation of a
specific IRE determination may be more nuanced than the circumstances presented in
this general line of decisions. See Womack v. WCAB (Phila. Parking Auth.), 14 C.D.
2018, slip op., 2019 WL 1200255, at *4-5 (Pa. Cmwlth. Mar. 13, 2019) (distinguishing
Womack from the circumstances in the present case -- given that the claimant in
Womack hadn’t challenged the IRE determination in issue on non-delegation grounds
until years after his disability benefits had been converted to partial -- and remanding for
a hearing to determine whether the claimant continued to be disabled, consistent with
Whitfield v. WCAB (Tenet Health System Hahnemann LLC, 188 A.3d 599 (Pa. Cmwlth.
2018)); see also id. at *5 (explaining that “the facts of Dana Holding are sufficiently
distinguishable” and “Dana Holding cannot inform our decision here”).
Notably, as well, recourse to procedural vehicles such as waiver can be viewed as a
matter separate and apart from retroactivity/prospectivity analysis. See, e.g.,
Reynoldsville Casket Co. v. Hyde, 514 U.S. 749, 758, 115 S. Ct. 1745, 1751 (1995)
(“New legal principles, even when applied retroactively, do not apply to cases already
closed.”); Findley v. Findley, 629 S.E.2d 222, 225 (Ga. 2006) (defining “full retroactivity”
as “application of a newly-pronounced rule to the parties before the Court and to all
others by and against whom claims may be pressed, consistent with res judicata and
procedural bars” (emphasis added)). See generally Rhodes, Loving Retroactivity, 45
FLA. ST. U.L. REV. at 420-23 (opining that “[p]rocedural doctrines, such as preclusion,
forfeiture, and limitations” are often applied to “mitigate the cost of legal change.”). In
this case, however, procedural impediments simply are not relevant, see supra note 5,
so that we need not presently assess the interrelationship of such barriers with the
retroactive versus prospective application of new rules.
[J-95-2019][M.O. – Saylor, C.J.] - 11
For the above reasons -- and consistent with the judicious approach of the
intermediate court -- we confine our review to the circumstances of the present case, in
which it is undisputed that the constitutional non-delegation challenge to Section
306(a.2) was raised in a manner that meets the legal requirements for issue
preservation. See supra note 5.
B. Selective Prospectivity, Generally
This Court’s retroactivity jurisprudence derives from that of the Supreme Court of
the United States, see, e.g., Blackwell, 527 Pa. at 183, 589 A.2d at 1099, and
accordingly, we begin with a discussion of the development of relevant principles at the
national level. By way of background, Employer seeks an application of Protz that is
selectively prospective, in that the ruling that Section 306(a.2) is unconstitutional was
applied to the Protz case itself, but Employer has sought and seeks at least a modified
application in Claimant’s case.9
The question of whether, or to what degree, courts should consider curtailing the
normal, retroactive application of certain new rulings has been the subject of intense
9 “Selective” or “modified” prospectivity is the application of a decision to the parties in
the case in which the decision announcing a new rule is rendered, but thereafter only to
parties whose conduct occurs after the announcement. See Lunsford v. Saberhagen
Holdings, Inc., 208 P.3d 1092, 1095-96 (Wash. 2009). A decision is purely prospective
if it is not even applied to the litigants before the court upon announcement of the new
rule. See id. Retroactivity entails extending the application of a decision into the larger
sphere of acts occurring before the announcement. See id.
Again, Employer also seeks modified prospectivity on another plane, since it asks for a
credit, in the form of an allowance for three years of partial disability under the Section
306(a.2) regime, toward the 500 weeks of partial disability available under the statute
should Claimant’s benefits again be converted to the partial-disability track. See supra
note 4.
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debate amongst judges and legal theorists at the national and state levels.10 At a
theoretical level, on the one hand, it had long been maintained that judges discover but
do not make law; rather, the role of the judiciary is to explicate governing legal precepts
already in existence. See, e.g., Linkletter, 381 U.S. at 622-23, 85 S. Ct. at 1734
(relating the traditionalist perspective that it was the duty of the court . . . not to
‘pronounce a new law, but to maintain and expound the old one’” (quoting 1 W ILLIAM
BLACKSTONE COMMENTARIES 69 (15th ed. 1809))). Upon this understanding, judicial
decisions naturally will apply retroactively. See, e.g., James B. Beam Distilling Co. v.
Ga., 501 U.S. 529, 535, 111 S. Ct. 2439, 2443 (1991) (plurality) (indicating that the
practice of full retroactivity was “overwhelmingly the norm”). Significantly, courts and
commentators for many years treated this view of the judicial function as a key
distinction between judicial and legislative pronouncements, the latter of which normally
apply prospectively.11
10 See, e.g., Lemon v. Kurtzman, 411 U.S. 192, 198, 93 S. Ct. 1463, 1468 (1973)
(plurality) (“[R]econciling the constitutional interests reflected in a new rule of law with
reliance interests founded upon the old is ‘among the most difficult [processes] which
have engaged the attention of courts, state and federal.” (citing Chicot Cty. Drainage
Dist. v. Baxter State Bank, 308 U.S. 371, 374, 60 S. Ct. 317, 319 (1940)); Beavers v.
Johnson Controls World Servs., Inc., 881 P.2d 1376, 1377 (N.M. 1994) (characterizing
the selection between mandatory retroactivity as contrasted with selective prospectivity
as involving “one of the great jurisprudential debates of the twentieth century”);
compare, e.g., Bradley S. Shannon, The Retroactive and Prospective Application of
Judicial Decisions, 26 HARV. J.L. & PUB. POL’Y 811, 874-76 (2003) (advocating for a firm
rule of retroactivity), with Beryl H. Levy, Realist Jurisprudence and Prospective
Overruling, 109 U. PA. L. REV. 1, 25-30 (1960) (making the case for selective
prospectivity).
11 See, e.g., Landgraf v. USI Film Prods., 511 U.S. 244, 265, 114 S. Ct. 1483, 1497
(1994) (“[T]he presumption against retroactive legislation is deeply rooted in our
jurisprudence, and embodies a legal doctrine centuries older than our Republic.”
(emphasis added)). See generally Elizabeth E. Beske, Backdoor Balancing and the
(continued…)
[J-95-2019][M.O. – Saylor, C.J.] - 13
Nevertheless, when courts have overruled past decisions or otherwise altered
settled (or ostensibly settled) expectations, intractable questions have arisen about the
fairness of applying such rulings to conduct undertaken in reliance upon a different legal
regime. See, e.g., Griffin v. Illinois, 351 U.S. 12, 26, 76 S. Ct. 585, 594 (1956) (plurality)
(Frankfurter, J., concurring) (“We should not indulge in the fiction that the law now
announced has always been the law. . . . It is much more conducive to law’s self-
respect to recognize candidly the considerations that give prospective content to a new
pronouncement of law.”). For this reason, for a time, the Supreme Court of the United
States experimented with widening the boundaries of prospective, or selectively
prospective, decision-making in seminal cases such as Linkletter, 381 U.S. at 629, 85
S. Ct. at 1738 (developing a doctrine by which the Court could deny retroactive effect to
a newly announced rule of criminal law), and Chevron Oil, 404 U.S. at 106-07, 92 S. Ct.
at 355-56 (extending the Linkletter doctrine to civil cases). See generally Rhodes,
Loving Retroactivity, 45 FLA. ST. U.L. REV. at 396 (depicting the Linkletter-Chevron line
of cases as entailing the “high tide of nonretroactivity”).
In later decisions, however, exemplified by Griffith, 479 U.S. 314, 107 S. Ct. 708,
the Supreme Court of the United States retrenched and adopted a firm rule requiring
retroactive application -- initially in the criminal-law context -- to cases pending on direct
appeal. See id. at 328, 107 S. Ct. at 716; see also Harper, 509 U.S. at 97, 113 S. Ct. at
2517 (depicting Griffith as imposing a “ban against ‘selective application of new rules’”
(citation omitted)). The Griffith Court expressed concern that selectively prospective
decision-making was too greatly in tension with the nature of judicial review, which
requires the adjudication of specific cases, “and each case usually becomes the vehicle
(…continued)
Consequences of Legal Change, 94 W ASH. L. REV. 645, 652-53 (2019) (discussing “a
thousand years of presumed retroactivity” of judicial rulings).
[J-95-2019][M.O. – Saylor, C.J.] - 14
for announcement of a new rule.” Griffith, 479 U.S. at 322-23, 107 S. Ct. at 713.
Furthermore, the Court reasoned, once a new rule has been applied to the litigants in a
specific case, “the integrity of judicial review requires that we apply that rule to all similar
cases pending on direct review.” Id. at 323, 107 S. Ct. at 713.12 See generally Francis
X. Beytagh, Ten Years of Non-Retroactivity: A Critique and Proposal, 61 VA. L. REV.
1557, 1624 (1975) (positing that “the single most significant difficulty presently posed by
[prospectivity] -- unequal treatment of those similarly situated resulting solely from the
sheer happenstance of the judicial calendar”), cited in Beavers, 881 P.2d at 1382.
Later, the Supreme Court came to characterize Linkletter balancing relative to cases
pending on direct appeal as “unprincipled and inequitable.” Teague v. Lane, 489 U.S.
288, 304, 109 S. Ct. 1060, 1072 (1989).
As to civil matters, the same retrenchment occurred in Harper, 509 U.S. 86, 113
S. Ct. 2510, which extended Griffith to civil cases upon the admonition that, “[t]he Court
has no more constitutional authority in civil cases than in criminal cases to disregard
current law or to treat similarly situated litigants differently.” Id. at 97, 113 S. Ct. at 2517
(quoting Am. Trucking Ass’ns, Inc. v. Smith, 496 U.S. 167, 214, 110 S. Ct. 2323, 2350
(1990) (plurality) (Stevens, J., dissenting)). Accordingly, the Supreme Court largely
ruled out the possibility of selective prospectivity across the wider range of cases.13
12 Parenthetically, it was clear from Griffith that the Supreme Court intended that new
rules should not be applied to matters in which a judgment of sentence was final. See
id. (“[W]e fulfill our judicial responsibility by instructing the lower courts to apply the new
rule retroactively to cases not yet final.”). Again, the application of procedural rules may
perhaps be viewed as an independent assessment in the analysis relating to claims that
otherwise would be barred. See supra note 8.
13 See generally Rhodes, Loving Retroactivity, 45 Fla. St. U.L. Rev. at 390 (“The
Supreme Court now abides by the doctrine that decisions applying new legal rules to
the parties govern all pending and future noncollateral adjudicative proceedings, even if
the operative events in that proceeding occurred under a different legal framework[.]”);
(continued…)
[J-95-2019][M.O. – Saylor, C.J.] - 15
C. New Rules and Unconstitutional Statutes
The above principles, as they have evolved, apply to the application of new
federal rules. However, per what is often termed the “Sunburst Doctrine,” state courts
remain free to evaluate the propriety of prospective application of new state-level rules
on their own terms. See Great Northern Ry. Co. v. Sunburst Oil & Refining Co., 287
U.S. 358, 364, 53 S. Ct. 145, 148 (1932) (“We think the Federal Constitution has no
voice upon the subject” of whether a state court may decline to give its decisions
retroactive effect.). See generally Hammer, Retroactivity and Restraint, 41 HARV. J.L. &
PUB. POL’Y at 426-33. Since, as the Commonwealth Court recognized, this Court’s
decisions have continued to recognize a role for a balancing of the competing interests
in discrete cases, we proceed to discuss the potential application of balancing in the
context of “new rules” and judicial rulings that statutes violate a state constitution.
It is often said in the cases that a threshold requirement to any consideration of
prospective application of a judicial decision is that it must announce a new rule or
principle of law, and indeed, such requirement has been embedded in a version of the
(…continued)
Stephen J. Hammer, Retroactivity and Restraint: An Anglo-American Comparison, 41
Harv. J.L. & Pub. Pol’y 409, 421 (2018) (discussing Harper as reiterating the “two basic
norms of constitutional adjudication’ that opposed prospectivity: first, the nature of
judicial review as distinct from legislation, and second, the need to treat similarly
situated parties the same” (quoting Harper, 509 U.S. at 95, 113 S. Ct. at 2516)).
Although the Supreme Court espoused a firm rule of retroactivity, it has otherwise
suggested that the possibility of prospective application may remain open in
extraordinary circumstances. See, e.g., Ryder v. United States, 515 U.S. 177, 184-85,
115 S. Ct. 2031, 2036-37 (1995) (indicating that “whatever the continuing validity of
Chevron Oil after Harper . . ., there is not the sort of grave disruption or inequity
involved in awarding retrospective relief to this petitioner that would bring that doctrine
into play”). Additionally, discrete considerations continue to arise in tax refund cases.
See generally Beske, Backdoor Balancing, 94 W ASH. L. REV. at 688-89.
[J-95-2019][M.O. – Saylor, C.J.] - 16
Linkletter-Chevron balancing test. See, e.g., Chevron Oil, 404 U.S. at 106, 92 S. Ct. at
355. Classically, this has been said to entail the overruling of clear past precedent or
the resolution of an issue of first impression that was not clearly foreshadowed. See id.
Many courts, however, have highlighted the “considerable ambiguity in the
threshold requirement that [the] court must announce a ‘new’ legal rule.” Davis v.
Moore, 772 A.2d 204, 227 (D.C. 2001);14 accord Teague, 489 U.S. at, 301, 109 S. Ct. at
1070 (recognizing that “[i]t is admittedly often difficult to determine when a case
announces a new rule”).15 Moreover, while judicial decisions declaring statutes
unconstitutional may not readily fit the paradigm of new rules or principles of law,
particularly when the underlying constitutional precepts are well established, the
Supreme Court of the United States has recognized that such decisions raise the same
concerns about reliance and vested rights that have animated the application of
balancing tests to determine whether the effect of new rules should be limited to
prospective application.
14 Notably, with regard to “new rules of local, i.e., District of Columbia, law,” the District
of Columbia Court of Appeals occupies a role parallel to that of a state court, in that it
retains the same independence in assessing prospectivity. Davis, 772 A.2d at 226-27
(citing Sunburst Oil, 287 U.S. at 364-65, 53 S. Ct. at 148).
15 The District of Columbia Court of Appeals elaborated as follows:
When is a legal rule “new” enough to meet this requirement?
To say that the test is whether the new rule is a “clear
break,” or “newly minted,” or “not clearly foreshadowed,”
offers little real guidance; not only do such standards invite
subjective adjudication, but they also are not consistent with
each other. “Not clearly foreshadowed” is a more lenient
standard than “clear break” while “newly minted” sounds like
it falls somewhere else on the continuum of novelty -- though
exactly where is not easy to say.
Davis, 772 A.2d at 227.
[J-95-2019][M.O. – Saylor, C.J.] - 17
In the early cases, courts generally accorded full retroactivity to judicial rulings
holding statutes to be unconstitutional via the application of a void ab initio doctrine. In
a seminal decision, Norton v. Shelby County, 118 U.S. 425, 6 S. Ct. 1121 (1886), the
Supreme Court of the United States pronounced that an unconstitutional action “confers
no rights; it imposes no duties; it affords no protection; it creates no office; it is, in legal
contemplation, as inoperative as though it had never been passed.” Id. at 442, 6 S. Ct.
at 1125.
However, courts began to develop a hesitancy to apply the doctrine strictly,
since:
The effect of the subsequent ruling as to [the constitutional]
invalidity [of a statute] may have to be considered in various
aspects,—with respect to particular relations, individual and
corporate, and particular conduct, private and official.
Questions of rights claimed to have become vested, of
status, of prior determinations deemed to have finality and
acted upon accordingly, of public policy in the light of the
nature both of the statute and of its previous application,
demand examination. These questions are among the most
difficult of those which have engaged the attention of courts,
state and federal, and it is manifest from numerous decisions
that an all-inclusive statement of a principle of absolute
retroactive invalidity cannot be justified.
Chicot, 308 U.S. at 374, 60 S. Ct. at 319. In this regard, in an oft-quoted passage from
the plurality opinion in Lemon, four Justices depicted statutory and judge-made rules of
law as “hard facts on which people must rely in making decisions and in shaping their
conduct.” Lemon, 411 U.S. at 199, 93 S. Ct. at 1468.
Consistent with such sentiments, many courts came to recognize a “modern
trend” away from applying the void ab initio doctrine, in favor of “a more equitable and
realistic approach that is tempered by considerations of reasonableness and good-faith
reliance on the purportedly valid statute.” Perlstein v. Wolk, 844 N.E.2d 923, 931 (Ill.
2006); see also id. at 929 (opining that strict application of the void ab initio doctrine
[J-95-2019][M.O. – Saylor, C.J.] - 18
“unduly discounts the real-life consequences flowing from a statutory enactment”);
accord Edwards v. Allen, 216 S.W.3d 278, 291 (Tenn. 2007); Lang v. Mayor of
Bayonne, 68 A. 90,92 (N.J. 1907) (“To require the citizen to determine for himself, at his
peril, to what extent, if at all, the Legislature has overstepped the boundaries defined by
the Constitution . . . would be to place upon him an intolerable burden.”).
In this vein, the Supreme Court of the United States departed from application of
the void ab initio doctrine in Lemon, finding it appropriate to apply a judicial ruling that a
statute violated the United States Constitution in a prospective fashion. See Lemon,
411 U.S. at 208-09, 93 S. Ct. at 1473.16 And, notably, the lead opinion both pronounced
that the prior decision finding a statute unconstitutional announced a new rule, see id. at
206, 93 S. Ct. at 1472, and engaged in a balancing assessment along the lines of the
considerations delineated in Linkletter and Chevron, see id. at 199-209, 93 S. Ct. at
1469-73, albeit that the opinion blended the discussion of prospectivity and remedies.17
See generally Reynoldsville Casket, 514 U.S. at 754, 115 S. Ct. at 1749 (positing that
“the ordinary application of a new rule of law ‘backwards,’ say, to pending cases, may or
16Although the lead opinion in Lemon was supported only by a plurality of Justices, the
result -- i.e., prospective application -- garnered majority support.
17 Lemon also has several other unique and distinguishing features, in that it concerned
government financing, predated Harper, and did not implicate the concern about
disparate treatment of similarly-situated litigants (since the relief accorded concerned
the same parties involved in the initial litigation of the issue of the constitutional validity
of the underlying statute). See Lemon, 411 U.S. at 193-94, 93 S. Ct. at 1466. The
decision is referenced here solely for the proposition that a majority of the Court
declined to enforce the invalidity of a statute retroactively, with at least four Justices
invoking equitable considerations including reliance interests. But see Reynoldsville
Casket, 514 U.S. at 762, 115 S. Ct. at 1753 (Kennedy, J., concurring) (maintaining that
the mere application of well-settled constitutional principles to discrete factual scenarios
is not the application of a new legal theory or one that had not been foreshadowed by
other precedents).
[J-95-2019][M.O. – Saylor, C.J.] - 19
may not, involve a further matter of remedies”). The Supreme Court has applied a
similar approach to other cases, at least in the public financing arena. See City of
Phoenix, Az. v. Kolodziejski, 399 U.S. 204, 213-15, 90 S. Ct. 1990, 1996-97 (1970);
Cipriano v. City of Houma, 395 U.S. 701, 706, 89 S. Ct. 1897, 1900 (1969) (“Where a
decision of this Court could produce substantial inequitable results if applied
retroactively, there is ample basis in our cases for avoiding the ‘injustice or hardship’ by
a holding of nonretroactivity.” (citation omitted)).
D. Additional Difficulties With Prospective Applications
In the Davis decision, referenced above, the District of Columbia Court of
Appeals not only highlighted the ambiguity in determining whether a particular decision
has announced a new rule for purposes of the Linkletter-Chevron doctrine, see supra
Part I(C), but more broadly observed that the doctrine “is difficult to apply in a principled
and predictable fashion.” Davis, 772 A.2d at 227; accord Commonwealth v.
Geschwendt, 500 Pa. 120, 125, 454 A.2d 991, 994 (1982) (plurality) (“Even the terms
‘prospective’ and ‘retrospective’ are deceiving in their complexities.”). The court posited
that the requirement for courts to investigate and balance reliance interests was an
“open-ended inquiry that is bereft of standards to guide it.” Davis, 772 A.2d at 227.
Noting that the pertinent questions are partly factual, the court also highlighted the
difficulty in being “expected to answer them without the benefit of a true evidentiary
record detailing the extent to which the old rule of law was relied upon.” Id. at 228; see
also id. (“The court is compelled to speculate, and to base its answers on hypotheses
that are untested and probably untestable.”). See generally Rhodes, Loving
Retroactivity, 45 FLA. ST. U.L. REV. at 409 (“The Court does not have the structural
capacity to conduct independent investigations of the potential applications of -- and
consequences from -- its new legal pronouncements.”). Ultimately, the District of
[J-95-2019][M.O. – Saylor, C.J.] - 20
Columbia Court of Appeals opted to follow the approach of the Supreme Court, settling
on the same firm (or firmer) approach of retroactivity embodied in Griffith and Harper.
See Davis, 772 A.2d at 230.
Another primary difficulty associated with Linkletter-Chevron balancing is that
judgments about context are important to the assessment of an appropriate application.
See, e.g., Reynoldsville Casket, 514 U.S. at 755, 115 S. Ct. at 1749 (“Not all cases
concerning retroactivity and remedies are of the same sort.”). For example, although a
number of courts maintain the balancing approach for new state-level rules even after
Griffith and Harper, see, e.g., Beavers, 881 P.2d at 1382, most courts recognize a very
strong impetus in favor of retroactivity and the application of the void ab initio doctrine in
criminal cases. See, e.g., People v. Gersch, 553 N.E.2d 281, 288 (Ill. 1990) (explaining
that “in the area of criminal prosecution, the ab initio principle is especially appropriate”);
Commonwealth v. Derhammer, 643 Pa. 391, 399, 173 A.3d 723, 728 (2017) (“It is
undisputed that a conviction based on an unconstitutional statute is a nullity.”). The
areas of property, contracts and taxation may warrant greater consideration of reliance
interests, militating in favor of the prospective application of new rules. See Lunsford,
208 P.3d at 1097; see also supra note 13; Oz Gas, 595 Pa. at 146, 938 A.2d at 285
(alluding to the “perhaps-unique effect of holding that a decision regarding a tax statute
is retroactive”).
There are many other variables, including whether a prior judicial (as opposed to
legislative) decision has been overruled, a scenario which harmonizes more comfortably
with the concept of a new judicial rule than paradigms involving unconstitutional
statutes. By way of another example, when a state court is engaging in traditional
substantive lawmaking by making adjustments to the common law, the case favoring
prospectivity are stronger. See In re L.J., 622 Pa. 126, 150, 79 A.3d 1073, 1087 (2013).
[J-95-2019][M.O. – Saylor, C.J.] - 21
Notably, some commentators have observed that the courts have not been
consistent in bearing relevant contextual considerations in mind. See, e.g., Richard S.
Kay, Retroactivity and Prospectivity of Judgments in American Law, 62 AM. J. COMP. L.
37, 65 (2014) (“For the most part, . . . neither courts nor commentators have regarded
the source of the law at issue as of much consequence to the temporal effect of a
judgment.”). The many variables and inconsistencies ultimately led the Supreme Court
of the United States to remark that “[n]ot surprisingly, commentators have ‘had a
veritable field day’ with the Linkletter standard, with much of the discussion being ‘more
than mildly negative.’” Teague, 489 U.S. at 303, 109 S. Ct. at 1071 (quoting Beytagh,
Ten Years of Non-Retroactivity, 61 VA. L. REV. at 1558 & n.3).
E. Pennsylvania’s Approach
The Blackwell decision, referenced by the Commonwealth Court, the parties, and
their amici, has been treated as a seminal decision in Pennsylvania on the subject of
retroactive versus prospective application. In Blackwell, the Court determined the
applicability, on direct appellate review, of a previous holding that a statutory provision
extending the tenure of the State Ethics Commission was an unconstitutional delegation
of legislative power and was therefore void. See Blackwell, 527 Pa. at 176, 589 A.2d at
1096.
The Blackwell Court initially explained that “the general rule followed in
Pennsylvania is that we apply the law in effect at the time of the appellate decision,” id.
at 182, 589 A.2d at 1099 (citation omitted), and that “a party whose case is pending on
direct appeal is entitled to the benefit of changes in law which occur[] before the
judgment becomes final.” Id. (citing Commonwealth v. Brown, 494 Pa. 380, 383, 431
[J-95-2019][M.O. – Saylor, C.J.] - 22
A.2d 905, 906-07 (1981)).18 Nevertheless, the Blackwell Court maintained (even in the
aftermath of Griffith’s overruling of Linkletter but prior to Harper’s overruling of Chevron
Oil) that retrospective application is a matter of judicial discretion to be exercised on a
case-by-case basis. See id. (citing August v. Stasak, 492 Pa. 550, 554, 424 A.2d 1328,
1330 (1981), in turn citing Linkletter, 381 U.S. at 629, 85 S. Ct. at 1738).
Referencing Desist, 394 U.S. 244, 89 S. Ct. 1030, and Stovall, 388 U.S. 293, 87
S. Ct. 1967 -- which derived from Linkletter -- the Blackwell Court proceeded to conduct
a very brief balancing assessment under the Linkletter factors. See Blackwell, 527 Pa.
at 183-84, 589 A.2d at 1099-1100. Notably, the preceding passage of the Blackwell
Court’s opinion recognized that such balancing was only appropriate with respect to the
application of a “new rule.” Id. at 183, 589 A.2d at 1099 (“The U.S. Supreme Court has
viewed the decision of whether to apply a new rule retroactively or prospectively as a
function of three considerations . . ..” (emphasis added)).
After having performed this balancing under the Linkletter factors, the Blackwell
Court turned to the Chevron Oil standard. The Court concluded that the Chevron Oil
test was not met, because the first prong requires the establishment of a new principle
of law, but that the relevant determination that a statute was unconstitutional did not
constitute such a new rule. See id. at 184, 589 A.2d at 1100. The Blackwell Court gave
very short shrift (if any) to the remaining Chevron Oil factors, while seeming to lack an
18 Notably, Brown had previously been criticized by a plurality of Justices in
Geschwendt, 500 Pa. 120, 454 A.2d 991, who strongly aligned themselves with the
“modern trend” favoring selective prospectivity upon equitable balancing. See id. at
134, 454 A.2d at 999 (“The ‘even handed justice’ argument myopically considers only
the interest of the disappointed litigant and ignores our responsibility to provide a fair
system of justice for all of the citizens of this Commonwealth.”). As reflected in
Blackwell and elsewhere, however, Brown has survived such criticism. See, e.g.,
Rothrock v. Rothrock Motor Sales, 584 Pa. 297, 308, 883 A.2d 511, 517 (2005) (citing
Brown).
[J-95-2019][M.O. – Saylor, C.J.] - 23
appreciation of the central role of a new rule to the application of both Linkletter and
Chevron Oil, as well as the integral substantive and historical relationship between the
factors delineated in those opinions.19 See id. at 185, 589 A.2d at 1100 (curtailing
balancing under Chevron Oil since “[t]hat prime impetus [i.e., that a new rule would
prejudice those formerly advantaged by an old one] is not a component in the instant
appeal”). See generally Beske, Backdoor Balancing, 94 WASH. L. REV. at 651-52
(describing “three eras of retroactivity” jurisprudence emanating from the Supreme
Court of the United States).
Nevertheless, the Blackwell Court’s rationale for determining that a new rule had
not been announced is significant, in that the Court reasoned that the constitutionally-
based non-delegation principles underlying the previous decision deeming the relevant
statute invalid were well established, despite the application of such principles to a
unique setting (i.e., extension of the tenure of the Ethics Commission). See id. at 184-
85, 589 A.2d at 1100 (citing Schreiber v. Republic Intermodal Corp., 473 Pa. 614, 622-
25, 375 A.2d 1285, 1289-90 (1977)).
The Blackwell Court proceeded to recognize the evolving concern that citizens
must rely on presumptively valid constitutional enactments. See id. at 187, 589 A.2d at
1101 (citing Lemon, 411 U.S. at 197, 93 S. Ct. at 1468, for the proposition that
“statutory or even judge made rules of law are hard facts on which people must rely in
making decisions and in shaping their conduct”). In this vein, the Blackwell Court
summarily pronounced that “it would indeed be chaotic to act as though the offending
provision of the [statute ruled to have been invalid] had never been enacted into law.”
Id. at 187-88, 589 A.2d at 1102. For this reason, the Court declared that the ruling
19 In the latter regard, Linkletter balancing and Chevron balancing are essentially
redundant conceptions, albeit that the earlier case arose in a criminal setting and the
later one in the civil arena.
[J-95-2019][M.O. – Saylor, C.J.] - 24
would not be extended to transactions which already had become final. See id. at 188,
589 A.2d at 1102. In these passages from its opinion, the Blackwell Court seemed to
allow that some sort of equitable balancing might be appropriate in some set of
circumstances to mitigate harsh effects from a ruling that a statute upon which people
had relied was unconstitutional. Accord Cianfrani v. SERB, 505 Pa. 294, 300, 479 A.2d
468, 471 (1984) (determining that the existence of a presumptively valid statute, prior to
a judicial declaration of its invalidity, was “an operative fact of consequence in the
review of the claims presented” relative to retrospective versus prospective application
(citing, indirectly, to Chicot, 308 U.S. at 374, 60 S. Ct. at 318)).
The Blackwell Court then explained -- inconsistently with its previous decision
that no new rule of law had been established -- that:
Where an appellate decision overrules prior law and
announces a new principle, unless the decision specifically
declares the ruling to be prospective only, the new rule is to
be applied retroactively to cases where the issue in question
is properly preserved at all states of adjudication up to and
including any direct appeal.
Blackwell, 527 Pa. at 188, 589 A.2d at 1102 (quoting Commonwealth v. Cabeza, 503
Pa. 228, 233, 469 A.2d 146, 148 (1983) (emphasis added)). Because the previous
decision deeming the statute invalid did not specifically declare the ruling to be
prospective only, the Court held that it applied to the case then before it as well as all
others pending on direct appeal where the challenge had been raised. See id.
From this, two observations are relevant. First, the Blackwell Court extended a
principle from the jurisprudence governing new rules to rulings that statutes are
unconstitutional (albeit while otherwise relying on the same new-rules overlay as a
reason why that specific jurisprudence should not apply). Second, the brief balancing
exercise that the Blackwell Court previously had undertaken seemed to have been
[J-95-2019][M.O. – Saylor, C.J.] - 25
wholly irrelevant to the outcome, given that a firm rule of retroactivity was ultimately
applied to the circumstances at hand in any event.20
Since Blackwell, this Court has continued to say that retroactive or prospective
application of state rules is a matter of judicial discretion but nevertheless has
maintained relatively firm enforcement of the general rule applying new state rules to
cases pending on direct appeal in which the issue has been preserved. See, e.g.,
Passarello, 624 Pa. at 601, 87 A.3d at 307.21 In this regard, relative to cases pending
on direct appeal in which the pertinent issue has been raised and preserved, the current
state of Pennsylvania law -- in effect -- appears to more closely resemble Griffith and
Harper than Linkletter and Chevron.22
20 In other words, Linkletter-Chevron balancing relative to cases in the course of
continuing litigation and selective prospectivity are inherently inconsistent with the
principle that all cases pending on direct appeal will be treated the same.
21In more cases than not, the approach has been treated more or less as in the nature
of a limiting principle, with emphasis on the issue preservation dynamic. See, e.g.,
Hays, ___ Pa. at ___, 218 A.3d at 1266-67.
22 Again, Pennsylvania courts are not alone in having great difficulty with
retrospectivity/prospectivity analysis. See, e.g., Kay, Retroactivity and Prospectivity, 62
AM. J. COMP. L. at 66 (“[T]he current confused state of the law on the possibility of
limited retroactivity of judgments demonstrates a persistent and possibly irresoluble
tension in the American view of law and of the roles of legal institutions.”); see also
supra Part I(D) and note 10.
Parenthetically, this Court’s new-rules jurisprudence is inconsistent in another aspect.
In Passarello, this Court treated its disapproval of the ruling of an intermediate court as
being in the nature of a new rule. See Passarello, 624 Pa. at 602, 87 A.3d at 308.
However, the Court has previously maintained that the disapproval of intermediate-court
precedent does not constitute a new rule. See, e.g., Kendrick v. District Attorney of
Phila. Cty., 591 Pa. 157, 171-72, 916 A.2d 529, 538 (2007). Given that it is not
presently material, we leave this incongruity for another day.
[J-95-2019][M.O. – Saylor, C.J.] - 26
F. Arguments and Analysis
Employer’s main contentions are that this Court has the authority to limit the
effect of Protz to prospective application; Protz announced a new rule of law; and
accordingly, the Court has the power to limit the retrospective application of the ruling in
that case. In terms of the considerations pertinent to the prospectivity/retroactivity
assessment, Employer presents its case under the Chevron criteria, see, e.g., Brief for
Appellant at 15, 20-21, 44, centering on the purpose and effect of the asserted new rule,
as well as equities associated with reliance and hardship ensuing on account of the
prior state of the law. See Chevron, 404 U.S. at 106-07, 92 S. Ct. at 355-56.23
Employer also alludes to the administrative burdens associated with a completely
upending of Section 306(a.2) IRE determinations.
Particularly, Employer stresses the Legislature’s focus on cost containment when
it enacted Section 306(a.2), as well as the reliance of employers and insurers on the
presumptively valid statute for over twenty years prior to Protz. Further, Employer
observes that Section 306(a.2) “withstood several challenges to this Court which never
clearly indicated that it would invalidate the IRE provisions on constitutional grounds.”
Id. at 16; see also id. at 22-23. For this reason, Employer maintains that “the statute
was constitutional until this Court declared otherwise on June 2, 2017[.]” Id. at 16.
23 Employer emphasizes that:
It is too late to send many [c]laimants back for independent
medical evaluations and attempt to find job availability
because many [c]laimants have aged to the point where they
no longer are employable. In many of those cases, just as in
this one, disability no longer is due solely to the work injury
but to a plethora of co-morbidities associated with the aging
process.
Brief for Appellant at 42-43.
[J-95-2019][M.O. – Saylor, C.J.] - 27
Employer also points to the Commonwealth Court’s 2014 decision in Wingrove v.
WCAB (Allegheny Energy), 83 A.3d 270 (Pa. Cmwlth. 2014), in which a non-delegation
challenge to Section 306(a.2) had been rejected. See Brief for Appellant at 277.24
Throughout its brief, Employer strives to bolster the weight of its own interests
while minimizing those of Claimant. For example, as noted, Employer attempts to
magnify the import of the present ruling by projecting its impact onto the broader range
of cases in which a non-delegation challenges to IREs were not raised prior to the initial
determination of their validity. See supra Part I(A) & n.7. As to Claimant, Employer
opines that he is not prejudiced by allowing a credit for the time that he received partial
disability benefits, at the total disability rate, under the invalid IRE, “because his weekly
wage payment remained the same.” Brief for Appellant at 16. Attempting to portray the
present matter as falling within a category of cases in which this Court has recognized
that it has greater discretion to apply a decision prospectively, Employer argues
extensively that Section 306(a.2) is entirely procedural in nature. See Brief for
Appellant at 37-40 (citing L.J., 622 Pa. at 150, 79 A.3d at 1087 (“We possess greater
discretion to impose a decision prospectively only ‘if the [new rule of law] is of the
court’s own making, involves a procedural matter, and involves common law
development’” (emphasis added; citation omitted))).
24As Claimant stresses, however, few of the cases cited by Employer in this line have
anything to do with constitutional non-delegation principles. See Brief for Appellee at
11-12. With regard to Wingrove, Claimant correctly explains that the claimant’s non-
delegation arguments were rejected for lack of development and not upon a deep
review of the merits. See id. at 12 (citing Wingrove, 83 A.3d at 277).
[J-95-2019][M.O. – Saylor, C.J.] - 28
Despite Claimant’s position before the Commonwealth Court, citing to Blackwell,
he now takes the position that no new rule of law is involved here. See Brief for
Appellee at 10-11. In any event, Claimant relies heavily on the general rule applying
new rules to cases pending on direct appeal in which the relevant challenge has been
preserved. See id. at 14-23. To the degree that Linkletter-Chevron balancing would be
appropriate, Claimant maintains that Employer had no legitimate expectation of finality,
since he timely raised a non-delegation challenge; Employer will have time to adjust to
its continuing obligations given its continuing obligation to pay benefits at the total
disability rate through 2023; and there otherwise is no vested right to a “credit” on the
terms sought by Employer. See id. at 4 (“The Employer cannot assert that its rights are
fundamentally more important than those of Pennsylvania’s injured workers and
therefore it can divest those injured workers of their right to protect their own interests in
a remedy for the harm they have sustained.”). Claimant also continues to highlight the
remedial nature of the Workers’ Compensation Act. See id. at 15-16 (citing Reifsnyder,
584 Pa. at 348, 883 A.2d at 541).
Initially, we will address Employer’s parsimonious treatment of Claimant’s
interests. First, Protz rested on the fact that the General Assembly invalidly delegated
substantive lawmaking authority -- i.e., material facets of the normative judgments
controlling which claimants will and which of them will not continue to receive benefits
past 500 weeks -- to a private entity. See Protz, 639 Pa. at 659-60, 161 A.3d at 836-37.
Thus, the notion that Section 306(a.2) can be couched as procedural, and that its
substantive import can be overlooked, is not creditable.
Similarly, Employer’s argument that Claimant would not be prejudiced by a
selectively prospective application of Protz is facially meritless. Employer seeks a credit
for the time that Claimant received partial disability benefits on account of the invalid
[J-95-2019][M.O. – Saylor, C.J.] - 29
Section 306(a.2) precisely so that it can carve that time out from its 500-week
obligation, should Claimant’s benefits subsequently be converted back to partial. Such
a reduction clearly has serious financial consequences inuring to injured claimants.
Ultimately, we find that the inertia favoring application of the general rule of
retroactive application to cases pending on direct appeal should control. Significantly,
this case concerns none of the subject areas in which this Court has observed that it
has additional latitude to implement a ruling prospectively, i.e., rules of the court’s own
making, involving procedural matters, or entailing common law development. See L.J.,
622 Pa. at 150, 79 A.3d at 1087. It does not involve public financing or tax refunds,
which places it in contrast with cases such as Oz Gas. Although there may be some
remaining latitude for a balancing of interests given the longstanding presumptive
validity of Section 306(a.2) and employers’ and insurers’ understandable reliance
thereon for many years, we find that Employer has not shown that its interests are so
substantially predominant as to justify a departure from the default approach.25
Claimant had a right to be free from an unconstitutional delegation of legislative
power affecting his substantive rights, which will be vindicated here. Significantly, this
case arises in the landscape of the substantial compromises and tradeoffs effected in a
workers’ compensation system, to which this Court has alluded many times. See, e.g.,
Triangle Bldg. Ctr. v. WCAB (Linch), 560 Pa. 540, 548, 746 A.2d 1108, 1112 (2000)
(discussing the underlying trade-off between loss spreading and insulation of employers
from tort liability inherent in the workers' compensation system). And the claimants’
interests are substantially elevated in the IRE context, in light of the “severe and explicit
25 We also appreciate that the Legislature has signaled its approval of the Sixth Edition
Guides via its enactment of Section 306(a.3) in the aftermath of Protz. For the above
reasons and those stated below, however, we find this factor, as well, to be insufficient
to tip the balance in favor of selective prospectivity.
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repercussions . . . upon claimant’s entitlement to continuing benefits,” without any
evaluation (administrative, judicial, or otherwise) of the traditional disability
considerations of ability to work and job availability. I.A. Constr., 635 Pa. at 561-62, 139
A.3d at 159-60. In view of the courts’ institutional limitations, see supra Part I(D), and
the absence of any developed, legislative-type record, we decline to proceed with an
attempt to engage in any deeper weighing of the important, respective, competing
interests involved here.
Instead, discerning no clear predominance of weight in Employer’s policy
arguments, we apply the general rule of retroactivity and hold that the Commonwealth
Court did not err in applying the Protz standard “to the case on appeal at the time of this
Court’s decision,” retroactive to the date of the IRE. Dana Holding, ___ Pa. at ___, 208
A.3d at 461.
Justice Dougherty’s concurring opinion cites the Blackwell decision for the
proposition that this Court applies Linkletter balancing in criminal cases and Chevron Oil
balancing in civil ones. See Concurring Opinion, slip op. at 2. In fact, as previously
explained, Blackwell itself applied both of these overlapping tests distinctly within the
confines of a single civil case. See supra Part I(E). Additionally -- and inconsistent both
with Blackwell’s own distinct treatment of the two tests and the assertion by the present
concurrence -- the Blackwell Court specifically opined that there was no difference
between the balancing criteria applied, respectively, in civil and criminal cases. See
Blackwell, 589 A.2d at 184 n.6, 589 A.2d at 1100 n.6.
The concurrence proceeds to criticize this opinion for failing to either overrule
Blackwell or to apply one particular line of reasoning from the shifting and sometimes
irreconcilable rationale employed by the Blackwell Court. See Concurring Opinion, slip
op. at 4. The fact of the matter is, however, that our decision harmonizes with the final
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line of Blackwell’s reasoning, which applied of the general rule of retroactivity to cases
pending on direct appeal. See Blackwell, 527 Pa. at 188, 589 A.2d at 1102. Our
hesitation in crediting this facet of Blackwell outright is that the Blackwell Court framed
the approach as applicable to instances in which prior law is overruled and a new
principle is announced, see id.; whereas, we are more of the view that “the mere
application of well-settled constitutional principles to discrete factual scenarios is not the
application of a new legal theory or one that had not been foreshadowed by other
precedents.” Reynoldsville Casket, 514 U.S. at 762, 115 S. Ct. at 1753 (Kennedy, J.,
concurring).26
Accordingly, rather than overruling Blackwell in its entirety, we have chosen to
deconstruct the decision, see supra Part I(E), and to analyze the present case in light of
the underlying themes and principles that are of relevance in this difficult area of the
law, see supra Parts I(B)-(F). Ultimately, our present decision stands for the principle
that the general rule in Pennsylvania will be that, at least where prior judicial precedent
isn’t overruled, a holding of this Court that a statute is unconstitutional will generally be
applied to cases pending on direct appeal in which the constitutional challenge has
been raised and preserved. At the present point in time, however, the Court is not of a
mind to exclude the possibility of equitable balancing in extraordinary cases, particularly
since no party this appeal has advocated any such position.
26 And notably, again, this aspect of Blackwell (i.e., the application of a principle that it
has said applies when the underlying decision has announced a new principle of law)
stands in stark contrast to the Blackwell Court’s prior pronouncement that no new rule of
law was in play. See Blackwell, 527 Pa. at 185, 589 A.2d at 1100 (“Blackwell II
established no new principle of law nor was there a clear break with past precedent.”).
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II.
Turning to Employer’s alternative issue based on its right to the due course of
law, such entitlement derives from the Remedies Clause in Article I, Section 11 of the
Pennsylvania Constitution, which provides:
All courts shall be open; and every man for an injury done
him in his lands, goods, person or reputation shall have
remedy by due course of law, and right and justice
administered without sale, denial or delay. Suits may be
brought against the Commonwealth in such manner, in such
courts and in such cases as the Legislature may by law
direct.
PA. CONST. art. I, §11.
Although the rights that this provision confers overlap with constitutional due
process norms, due course of law stands as an independent guarantee of legal
remedies for private wrongs in Pennsylvania courts. In Menges v. Dentler, 33 Pa. 495
(Pa. 1859), this Court explained that the provision for due course of law requires that
adjudication must occur pursuant to the temporally applicable law:
The law which gives character to a case, and by which it is
to be decided (excluding the forms of coming to a decision),
is the law that is inherent in the case, and constitutes part of
it when it arises as a complete transaction between the
parties. If this law be changed or annulled, the case is
changed, and justice denied, and the due course of law
violated.
Id. at 498.
The Court, however, has since clarified that the due course of law protects only
vested rights — meaning “a title, legal or equitable, to the present or future enforcement
of a demand, or a legal exemption from a demand made by another.” Lewis v. Pa. R.
Co., 220 Pa. 317, 324, 69 A. 821, 823 (1908). Accordingly, and as the Commonwealth
Court aptly explained: “the due course of law provision is invoked when a change in the
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legislation attempts to alter or eliminate a vested or accrued cause of action.” Dana,
195 A.3d at 643 (citations omitted).
Employer argues that its right to due course of law impedes any retroactive
application of Protz, because at the time of Claimant’s IRE, Section 306(a.2) was valid.
The company submits that the IRE, when performed in July 2014, accrued as a partial
defense, and thus, it is entitled to the benefit of the disability modification indefinitely, or
at least for the time elapsing before Protz was decided.
However, as the Commonwealth Court observed, Employer cites no authority
suggesting that the due process of law is applicable whenever a statute is found to be
unconstitutional. See Dana, 195 A.3d at 644. In any event, we agree with the
Commonwealth Court that a disability modification is not vested when it remains subject
to a preserved challenge pursued by a presently aggrieved claimant. See Konidaris,
598 Pa. at 71, 953 A.2d at 1240 (stating a vested right is “something more than a mere
expectation, based upon an anticipated continuance of existing law”).
The order of the Commonwealth Court is affirmed.
Justices Baer, Todd, Donohue, Wecht and Mundy join the opinion.
Justice Dougherty files a concurring opinion.
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