The central question presented on this appeal is whether the rule of
Califano v. Goldfarb,
I.
Francis Cash applied for widower’s insurance benefits on October 21,1976. Initially *628 his claim was denied since his own social security retirement account would provide him with greater monthly benefits. Cash immediately sought limited review of that denial for the period between December 1975 and July 1976, months during which he had not been eligible for retirement benefits. This claim was denied on the basis that Cash had failed to establish dependency upon his deceased spouse as required by 42 U.S.C.A. § 402(f)(1)(D)(i) (1974). No such showing of dependency was required for similarly situated widows. See id. § 402(e). Cash lodged an administrative appeal solely on the dependency question.
During the pendency of Cash’s claim before the Social Security Administration, the Supreme Court struck down the dependency requirement for widowers as violative of the equal protection concept embodied in the Fifth Amendment. Califano v. Goldfarb, supra. Nevertheless, the Administrative Law Judge who considered Cash’s appeal, refused to apply Goldfarb since the Supreme Court had not specifically ruled that Goldfarb was to be applied retroactively. The Secretary adopted the ALJ’s conclusion that Cash was not entitled to benefits. Cash brought suit in district court, 42 U.S.C.A. § 405(g), and the district court, applying Goldfarb, reversed the Secretary and awarded benefits for the period in question. This appeal followed.
II.
A general rule in Anglo-American jurisprudence is that judicial decisions are to be applied retroactively. Generally speaking, this is necessarily so for the parties before the court. It is implicitly so for all other potential litigants. The concept stems from the Blackstonian view, that judges do not make law; they find law. Judicial declaration of law is merely a statement of what the law has always been. “For if it be found that the former decision is manifestly absurd or unjust, it is declared, not that such a sentence was bad law, but that it was not law.” 1 Blackstone, Commentaries on the Law of England 70 (1765). A corollary of this proposition is the rule that a court will apply judicial case law as that law exists at the time of decision. These rules are in contrast with the precept that legislation operates prospectively only. Thus it has been argued that to the extent a court applies nonretroactivity to a decision or legal interpretation, that court has undertaken a legislative function. See, e. g., Mishkin, The Supreme Court, 1964 Term, Forward: The High Court, The Great Writ, and the Due Process of Time and Law, 79 Harv.L.Rev. 56, 58-72 (1965).
However, even these rudiments of common law must be applied with some flexibility.
1
The lay perception is that courts do change law. Moreover, cases do arise in which equitable considerations outweigh subservience to traditional notions of the judicial function. When parties have substantially relied upon prior legal interpretations, it may be manifestly unjust to apply the current interpretation retroactively even if that interpretation does represent the “correct” statement of law. This was the equitable consideration behind the “all deliberate speed” mandate of
Brown v. Board of Education,
It has in it much literal truth in the context of all but a few exceptional cases when the courts are about their usual business of settling controversies in terms of the law as it is declared at the moment of decision. It is not a shackle, however. In the exceptional case it does not compel a court confronted with earlier misreadings of a statute to choose between perpetuation of the error and casting inequitable burdens upon litigants who had acted in justifiable reliance upon the earlier reading.
Lester v. McFaddon,
III.
In
Chevron Oil Co. v. Huson,
In our cases dealing with the nonretroactivity question, we have generally considered three separate factors. First, the decision to be applied nonretroactively must establish a new principle of law, either by overruling clear past precedent on which litigants may have relied . . . or by deciding an issue of first impression whose resolution was not clearly foreshadowed . . . . Second, it has been stressed that “we must . . . weigh the merits and demerits in each case by looking to the prior history of the rule in question, its purpose and effect, and whether retrospective operation will further or retard its operation.” . Finally, we have weighed the inequity imposed by retroactive application, for “[wjhere 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.”
Id.
at 106-7,
The cases in which the Supreme Court has adopted nonretroactivity have all included a reliance factor. Some of these cases have involved unexpected interpretations of procedural law, the retroactive application of which would have clearly prejudiced an unwary litigant by erecting, directly or indirectly, an absolute bar to his claim.
Chevron Oil Co. v. Huson, supra; England v. Louisiana State Board of Medical Examiners,
The Secretary argues that Califano v. Goldfarb “was not clearly foreshadowed” by legal precedent, and that the Secretary could justifiably presume the legality of the dependency requirement in § 402(f). In presenting this argument, the Secretary emphasizes that the law of sexual discrimination is in a state of evolution and that the Goldfarb decision, a 4-1-4 plurality, is a reflection of uncertainty caused by developing concepts of equal protection. But our analysis does not center upon the Court’s vote in a particular case, nor upon the general character of the law. The question to be addressed is whether past precedents had paved the way for the result in Goldfarb or whether Goldfarb was a departure from an expected result.
In
Frontiero v. Richardson,
The Secretary cannot have been surprised by the result in Goldfarb. Since the opinions in Frontiero and Wiesenfeld were not themselves unanimous, the most the Secretary could have hoped for was a halt in a very clear trend. None of the nonretroactivity cases have turned on so tenuous a proposition. Instead those cases have either involved a complete reversal of prior law, Chevron Oil Co., supra, or a pronouncement upon a case of first impression, Lemon v. Kurtzman, supra. For example, in Lemon the question before the Court was the validity of a newly improvised plan which would permit a state to partially subsidize sectarian schools. The Lemon Court held that the plan did violate the establishment clause, but that the schools’ initial reliance upon the plan was justifiable in that the violations inherent in the plan posed constitutional questions of first impression. A similar result was achieved in cases involving due process violations in municipal bond elections. City of Phoenix v. Koiodziejski, supra; Cipriano v. City of *631 Houma, supra. The essence of these decisions is that reasonable parties will not be held to foreknowledge of the result in a case of first impression. Goldfarb clearly did not involve the reversal of an earlier decision, and, in light of Frontiero and Wiesenfeld, the issue presented in Goldfarb was not one of first impression. The Secretary has not met even this threshold requirement of the reliance factor.
The next factor to be considered is whether retroactive application of the new rule “will further or retard its operation.” As indicated previously, this factor is not dispositive unless there is a showing of inequity, and, in light of the presumption of retroactivity, a neutral response to this query merely augurs against nonretroactivity.
The question before the Court in
Linkletter v. Walker,
The Court also examined this factor in
Lemon v. Kurtzman, supra.
There the question was whether the state should be allowed to pay the sectarian schools funds for expenses incurred by the schools prior to the Supreme Court’s invalidation of the funding plan. The Court noted that since the primary illegality of the plan was not the funding aspect but the state’s supervisory role over the sectarian schools in implementing the funding, the rule disallowing the plan would not be impaired by paying these funds. The state’s supervisory involvement had come to an end. The payment of funds upon which the schools had relied was an equitable remedy which neither circumvented nor violated the new constitutional rule. A contrary result was reached in
New York v. Cathedral Academy,
The rule at issue here is the equal protection of female wage earners. Unlike the situation in Linkletter, where the rule was designed to implement a policy, here the rule and the policy are one. Retroactivity would simply insure that money paid into Social Security by a female wage earner would be available to her surviving spouse on the same terms as money earned and paid by a male wage earner is available to his spouse. The time of protection is expanded. In fact, like the situation presented in Cathedral Academy, nonretroactivity would retard application of the rule by permitting the Secretary to continue to violate constitutional rights mandated by the due process clause of the Fifth Amendment.
Finally, the court must consider the equities. Would the administration of Social Security benefits be severely prejudiced by applying Goldfarb to cases which were pending at the time Goldfarb was decided? In the absence of justifiable reliance on the validity of § 402(f)(l)(D)(i), the Secretary cannot be heard to complain of a detriment *632 in this regard. There has been no showing that other beneficiaries would suffer a loss of benefits as a result of a retroactive application of Goldfarb. We only know that more benefits will be payable by the Secretary. A financial impact alone is an insufficient basis to mandate nonretroactivity. Prospective application of Goldfarb will have a financial impact. When nonretroactivity has been applied there was a showing of substantial prejudice based on justifiable reliance. There has been no such showing here. 3
We hold that the Secretary has failed to establish the equitable predicate necessary to avoid the general rule that judicial decisions are to have retroactive effect and that a court is to apply the “terms of the law as it is declared at the moment of decision.”
Lester v. McFaddon, supra,
IV.
The Secretary next contends that an award of past-due benefits would violate the sovereign immunity of the United States.
Primary reliance is placed upon
United States v. Testan,
The question before this court is whether claimant was entitled to widower’s benefits under 42 U.S.C.A. § 402(f) from December 1975 through July 1976. Under § 402(f) Congress has granted widowers a substantive right to Social Security benefits. In light of
Goldfarb
and the preceding discussion, it is clear that Cash was entitled to such benefits during that period. Our decision will not require an assessment of damages against the United States. We merely follow the mandate of § 405(g) which grants the district court the “power to enter, upon the pleadings and transcript of record, a judgment affirming, modifying, or reversing the decision of the Secretary, with or without remanding the cause for a rehearing.” Reversal of the Secretary’s determination not to grant benefits, naturally requires their disbursement.
Accord, Wright v. Califano,
Cash’s claim for benefits is based upon a substantive right granted by Congress, and that right is enforceable by the district court’s express power to reverse the Secretary. As the court stated in
Wright v. Califano, supra,
AFFIRMED.
Notes
. The Constitution neither adopted nor rejected the Blackstonian view. The seminal case is
Great Northern Ry. v. Sunburst Co.,
. The writ of habeas corpus adds a dimension to retroactivity questions in the criminal area which is not present in civil litigation. With the aid of that writ, the doctrine of finality may be circumvented.
. In
City of Los Angeles v. Manhart,
.
See also Edelman v. Jordan,