Aledo-Garcia v. Puerto Rico Nat. Guard Fund, Inc., ALEDO-GARCI
| Decision Date | 03 October 1989 |
| Docket Number | ALEDO-GARCI,No. 88-1427,P,88-1427 |
| Citation | 887 F.2d 354 |
| Parties | 51 Fair Empl.Prac.Cas. 9, 51 Empl. Prac. Dec. P 39,416, 58 USLW 2275 Jorgelaintiff, Appellant, v. PUERTO RICO NATIONAL GUARD FUND, INC., et al., Defendants, Appellees. . Heard |
| Court | U.S. Court of Appeals — First Circuit |
Jose Enrique Colon Santana, Rio Piedras, P.R., for plaintiff, appellant.
Roberto Torres Gonzalez with whom Deliz & Torres Gonzalez was on brief, for defendants, appellees.
Before COFFIN, Circuit Judge, BROWN, * Senior Circuit Judge, and BOWNES, Circuit Judge.
This case raises, as the sole issue, the question of the "retroactive" application of the 1986 amendment to the Age Discrimination in Employment Act (ADEA) 1 to the dismissal of a 70 year old employee from the position of Warehouse General Supervisor for stores run by the Puerto Rico National Guard Fund (the Fund).
The trial court held that Congress's removal of the upper age limit, effective January 1, 1987, was inapplicable to Aledo-Garcia who was mandatorily retired effective December 31, 1986. We reverse the decision of the trial court granting summary judgment for the Fund and remand for trial.
Retroactive? Prospective? Which?
The Fund argues that Aledo-Garcia's discharge was effective as of December 31, 1986 and that the October 31, 1986 amendment of the ADEA to afford its protection to those over 70 years, effective January 1, 1987, cannot now be applied to Aledo-Garcia. It is ironic that all of the legal writing on the subject uses the term "retroactive." It is not really retroactive--i.e. going back to a time prior to the enactment of the questioned legislative act. Rather, here the problem is whether the act fully effective as of the time the case is heard and decided should govern conduct occurring before the stated effective date. Finally, the usual rubric that a court should apply the law which is effective at the time of hearing/decision is of little help where, as here, there is no doubt that the October Amendments were then in full effect, the question remaining being whether its stated effective date controlled its application for a time prior to that. However slippery, ill defined or uncertain the term retroactive might be, we continue to use it in the traditional sense or perhaps, more accurately, nonsense.
The controlling law on this subject for federal legislation has been handed down from the United States Supreme Court in Bradley v. Richmond School Board, 2 and followed by this Circuit in New England Power Co. v. U.S. 3 In Bradley, the Court stated that "a court is to apply the law in effect at the time it renders its decision, unless doing so would result in manifest injustice or there is statutory direction or legislative history to the contrary." 4
Although the principle is not absolute, 5 under Bradley, a trial court applies a two pronged test, and unless it can determine either that (i) manifest injustice will result, or (ii) there is statutory direction or legislative history indicating that the applicable law is the old law, it should apply the law in existence at the time it renders its decision.
Under Bradley, manifest injustice is examined in light of three factors, (i) the nature and identity of the parties, (ii) the nature of their rights, and (iii) the nature of the impact of the change in the law upon those rights. 6
Under (i) we must make a determination regarding the nature of the parties before the court. Justice Marshall's words, as quoted in Ralis (n. 4, supra), reflect that a distinction exists between public and private parties, and that if the party against whom the statute is to be applied is a public party, then the "struggle" against the so-called retroactive application is not as hard.
The Fund argues that it is a private, non-profit corporation organized under the General Corporation Law of the Commonwealth of Puerto Rico. 7 The Fund operates post exchanges and canteens for the benefit of military and police forces in Puerto Rico and their families. The post exchanges and canteens are operated in public facilities leased from the government of Puerto Rico. The corporation's profits are used to provide tuition assistance, life insurance, and social and cultural amenities to the Commonwealth's military and police groups. The Fund does not receive any direct governmental aid or financial assistance.
We do not accept the Fund's characterization of itself as a private organization. The Fund fulfills a wider public purpose by providing facilities to a specific group of public employees, the Commonwealth military and police forces and members of their families. Moreover, although the Fund is incorporated under the general business statutes of Puerto Rico, it is actually authorized under Puerto Rico's military code. 8
Given the purpose of the organization, to help people in military service, which benefits society in general, and the official involvement of the Puerto Rican military hierarchy in the activities of the Fund, the Fund serves a wider public purpose and is, in effect, a public entity.
We hold, therefore, that as the Fund is a public entity, the greater protection against retroactivity ordinarily afforded a truly private organization in accordance with Chief Justice Marshall's directions, is inapplicable in this case. Thus, the application of the law as amended is not unduly burdensome.
We point out that, although $1,000,000 in actual and $5,000,000 in punitive damages, as sought in the complaint, could be construed as potentially resulting in manifest injustice to the Fund, the punitive damages requested could not be awarded because the question regarding which law to apply is a real issue in controversy, and the actual damages are limited under the ADEA to primarily lost wages. 9
Lost wages under the ADEA are generally determined as being the difference between what was actually earned and what would have been earned but for the illegally discriminatory act. 10 The amount of wages that could have been earned includes the wage rate illegally denied multiplied by the period of time the wage was illegally denied, plus the value of any fringe benefits such as life insurance, pension benefits, medical insurance, and any other benefits generally provided by the employer. 11 From this aggregate total of denied compensation is deducted any amounts earned by the plaintiff during the affected period.
Liquidated damages equal to back pay are available in addition to back pay as a form of punitive damages, but are generally only paid when the employer "willfully" disregards the law, willful being defined as reckless. 12 In the instant case, there is no such willful disregard as the application of the amended law was a real question in controversy.
Thus, the potential $6,000,000 award requested by Aledo-Garcia will not result in manifest injustice because, for the forthcoming trial, we declare that it is not legally sustainable.
An examination of the nature of the rights affected likewise does not demonstrate that the Fund is being subjected to substantial injustice. The right of the Fund that was affected was the right to fire Aledo-Garcia solely because of his age. The right Aledo-Garcia has is the right to continued employment, in the absence of any non-discriminatory factors that might legitimately support a decision to terminate his services, without consideration as to his age, a right that the amended law recognizes.
The third aspect of the test, the impact of the application of the amended law on the circumstances of Aledo-Garcia's firing, stems from the concern regarding the application of new and unanticipated obligations upon a party. As this Court has written,
[u]nder the manifest injustice standard the disappointment of private expectations that results from the implementation of a new rule must be balanced against public interest in the enforcement of that rule.
New England Power, 693 F.2d at 245 (citations omitted). Thus, we must balance the right of the Fund to fire an employee solely for reasons of age, a right that was not unconditional after October 31, 1986, against the right of that employee to continue his employment under the protection of the ADEA as amended. Given that the burden we are imposing is on a public agency and that the relative rights are the right to employment free of age discrimination versus the right to fire an employee solely because of his age, we are...
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...time the case is heard and decided, should govern conduct occurring before the stated effective date." Aledo-García v. Puerto Rico Nat. Guard Fund, Inc., 887 F.2d 354, 355 (1st Cir.1989). However, since we find that regardless of whether the application is retroactive or not, the result wou......
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