United States v. Will United States v. Will

• Decision Date: 15 December 1980
• Docket Number: Nos. 79-983,79-1689,s. 79-983
• Parties: UNITED STATES, Appellant, v. Hubert L. WILL et al. UNITED STATES, Appellant, v. Hubert L. WILL et al
• Court: U.S. Supreme Court

449 U.S. 200

101 S.Ct. 471

66 L.Ed.2d 392

UNITED STATES, Appellant,

v Hubert L. WILL et al.

UNITED STATES, Appellant,

v. Hubert L. WILL et al.

Nos. 79-983, 79-1689.

Argued Oct. 13, 1980.

Decided Dec. 15, 1980.

Syllabus

An interlocking network of federal statutes fixes the compensation of high-level federal officials, including federal judges, and provides for annual cost-of-living adjustments in salary determined in the same way as those for federal employees generally. In four consecutive fiscal years (hereafter Years 1, 2, 3, and 4), Congress, with respect to these high-level officials, enacted statutes to stop or reduce previously authorized cost-of-living increases initially intended to be automatically operative under that statutory scheme. In Years 2 and 3, the statutes became law before the start of the fiscal year, and in Years 1 and 4 became law on or after the first day of the fiscal year. A number of United States District Court Judges (appellees) filed class actions against the United States in District Court, challenging the validity of the statutes under the Compensation Clause of the Constitution, which provides that federal judges shall receive compensation which "shall not be diminished during their Continuance in Office." The District Court granted summary judgments for appellees.

Held :

1. This Court has jurisdiction of the appeals under 28 U.S.C. § 1252, providing for appeals to this Court from judgments holding an Act of Congress unconstitutional in any civil action to which the United States is a party. And the District Court had jurisdiction over the actions under 28 U.S.C. § 1346(a)(2), which confers on district courts and the Court of Claims concurrent jurisdiction over actions against the United States based on the Constitution when the amount in controversy does not exceed $10,000, none of the individual claims here having been alleged to have exceeded that amount. Pp. 210-211.

2. Title 28 U.S.C. § 455-which requires a federal judge to disqualify himself in any proceeding in which his impartiality might reasonably be questioned or where he has a financial interest in the subject matter in controversy or is a party to the proceeding-by reason of the Rule of Necessity does not operate to disqualify all federal judges, including the Justices of this Court, from deciding the issues presented by these cases. Where, under the circumstances of these cases, all Article III judges have an interest in the outcome so that it was not possible to assign a substitute district judge or for the Chief Justice to remit the appeal, as he is authorized to do by statute, to a division of the Court of Appeals with judges who are not subject to the disqualification provisions of § 455, the common-law Rule of Necessity, under which a judge, even though he has an interest in the case, has a duty to hear and decide the case if it cannot otherwise be heard, prevails over the disqualification standards of § 455. Far from promoting § 455's purpose of reaching disqualification of an individual judge when there is another to whom the case may be assigned, failure to apply the Rule of Necessity in these cases would have a contrary effect by denying some litigants their right to a forum. And the public might be denied resolution of the crucial matter involved if first the District Judge and now all the Justices of this Court were to ignore the mandate of the Rule of Necessity and decline to answer the questions presented. Pp. 211-217.

3. The statutes in question in Years 1 and 4, but not in Years 2 and 3, violated the Compensation Clause. Pp. 217-230.

(a) In each of the four years in question, Congress intended in effect to repeal or postpone previously authorized salary increases for federal judges, not simply to consign such increases to the fiscal limbo of an account due but not payable. Pp. 221-224.

(b) Since the statute applying to Year 1 became law on the first day of the fiscal year, by which time the salary increases already had taken effect, it purported to repeal a salary increase already in force and thus "diminished" the compensation of federal judges. That the statute included in the salary "freeze" other federal officials who are not protected by the Compensation Clause did not insulate a direct diminution in judges' salaries from the clear mandate of that Clause. Pp. 224-226.

(c) But the statutes applying to Years 2 and 3 became law before the scheduled salary increases for federal judges had taken effect, i. e., before they had become a part of the compensation due Article III judges, and hence in no sense diminished the compensation such judges were receiving. Pp. 226-229.

(d) Even though the statute applying to Year 4 referred only to "executive employees, which includes Members of Congress," and did not expressly mention judges, it appears that Congress intended to include Article III judges. Accordingly, where such statute, similarly to the statute applying to Year 1, purported to revoke an increase in judges' compensation after the statutes granting the increase had taken effect, it violated the Compensation Clause. Pp. 229-230.

No. 79-983, D.C., 478 F.Supp. 621, and No. 79-1689, affirmed in part, reversed in part, and remanded.

Kenneth S. Geller, Washington, D.C., for appellant.

Kevin M. Forde, Chicago, Ill., for appellees.

Chief Justice BURGER delivered the opinion of the Court.

These appeals present the questions whether under the Compensation Clause, Art. III, § 1, Congress may repeal or modify a statutorily defined formula for annual cost-of-living increases in the compensation of federal judges, and, if so, whether it must act before the particular increases take effect.

I

Congress has enacted an interlocking network of statutes to fix the compensation of high-level officials in the Executive, Legislative, and Judicial Branches, including federal judges. It provides for quadrennial review of overall salary levels and annual cost-of-living adjustments determined in the same fashion as those for federal employees generally. In four consecutive fiscal years, Congress, with respect to these high-level Executive Branch, Legislative, and Judicial salaries, enacted statutes to stop or to reduce previously authorized cost-of-living increases initially intended to be automatically operative under that statutory scheme, once the Executive had determined the amount. In two of these years, the legislation was signed by the President and became law before the start of the fiscal year; in the other two years, on or after the first day of the fiscal year.

A.

The salaries of high-level Executive, Legislative, and Judicial officials are set under the Postal Revenue and Federal Salary Act of 1967, 81 Stat. 642, as amended, 2 U.S.C. §§ 351-361 (1976 ed. and Supp. III). The Salary Act provides for a quadrennial review, starting in 1969, of these officials' compensation. A Commission on Executive, Legislative, and Judicial Salaries periodically examines the salary levels for these positions in relation to one another and to the General Schedule (GS), the matrix of grades and steps that determines the salaries of most federal employees. Its recommendations are submitted to the President, who in turn submits that report with his recommendations to Congress in the next budget. Each House of Congress must vote on the President's proposal within 60 days. If both Houses approve, the adjustment takes effect at the start of the first pay period beginning 30 days thereafter.¹

In 1975, Congress adopted the Executive Salary Cost-of-Living Adjustment Act, Pub.L. 94-82, 89 Stat. 419. The Adjustment Act subjects the salaries covered by the Salary Act to the same annual adjustment made in the General Schedule under the Federal Pay Comparability Act of 1970, 5 U.S.C. §§ 5305-5306. The Comparability Act requires that each year the President designate an agent to compare federal salaries to data on private-sector salaries compiled by the Bureau of Labor Statistics. The agent must undertake certain steps in his investigation and, ultimately, submit a report to the President recommending adjustments as deemed appropriate to bring federal employees' salaries in line with prevailing rates in the private sector. A separate Advisory Committee on Federal Pay then reviews that report and makes its own independent recommendation. Thereafter, the President issues an order adjusting the salaries of federal employees and submits a report to Congress listing the overall percentage of the adjustment and including the reports and recommendations submitted to him on the subject. If the President believes that economic conditions or conditions of national emergency make the planned adjustment inappropriate, he may submit to Congress before September 1 an alternative plan for adjusting federal employees' salaries. This alternative plan controls unless within 30 days of continuous legislative session either House of Congress adopts a resolution disapproving of the President's proposed plan. If one House disapproves, the agent's recommendation governs. The increases take effect with the start of the first pay period starting on or after the beginning of the federal fiscal year on October 1.

This complex web of base salaries adjusted annually for civil service employees and again quadrennially for higher-rank positions has led to the following statutory definition of a United States district judge's compensation:

"Each judge of a district court of the United States shall receive a salary at an annual rate determined under section 225 of the Federal Salary Act of 1967 (2 U.S.C. 351-361), as adjusted by section 461 of this title." 28 U.S.C. § 135.

Similarly phrased statutes apply to all other Article III judges.² Title 28 U.S.C. § 461 in turn provides that the an- nual GS adjustment, rounded to the nearest multiple of $100, shall apply to salaries subject to that section, effective at the start of the next pay period....