Opinion
Case No. 05C-07-018 WLW.
Submitted: September 18, 2006.
Decided: December 7, 2006.
Upon Plaintiff's Application for Costs. Granted.
Nicholas H. Rodriguez, Esquire of Schmittinger and Rodriguez, P.A., Dover, Delaware; attorneys for the Plaintiff.
Thomas P. Leff, Esquire of Casarino Christman Shalk, P.A., Wilmington, Delaware; attorneys for the Defendant.
ORDER
Plaintiff, Marvin E. Fraser ("Mr. Fraser"), was injured in a motor vehicle accident which occurred on November 10, 2003. Plaintiff had $100,000 worth of Personal Injury Protection insurance coverage ("PIP") with Defendant State Farm Mutual Automobile Insurance Company ("State Farm"). State Farm voluntarily paid $49, 759.74 in lost wages and medical expenses. The Defendant refused to make any further payments for medical expenses based upon the contention that the remaining expenses were incurred for injuries unrelated to the motor vehicle accident. A PIP suit was filed against State Farm for the remaining balance of the PIP coverage ($50,240.26).
The case proceeded to a Rule 16 Arbitration, and a hearing was held on November 7, 2005. The Arbitrator entered an award in favor of Mr. Fraser in the amount of $50,240.26, the amount of the remaining PIP coverage. Subsequently, State Farm filed for a trial de novo. The case proceeded to trial in this Court, and there was a jury verdict in favor of the Plaintiff for $56,084.54, an amount which exceeded the remaining available PIP coverage. C onsequ ently, by agreement of both parties, the jury's verdict was entered as a judgment in favor of the Plaintiff for the remaining balance of PIP Coverage ($50,240.26).
Discussion
Pursuant to Superior Court Civil Rule 54(d), Mr. Fraser seeks costs under Superior Court Civil Rule 16.1(k)(11)(iii) arising from State Farm's demand of a trial de novo subsequent to an arbitration hearing between the Parties. Rule 16.1(k)(11)(iii) states:
"If the party who demands a trial de novo fails to obtain a verdict from the jury or judgment from the Court, exclusive of interests and costs, more favorable to the party than the arbitrator's order, that party shall be assessed the costs of arbitration, and the ADR Practitioner's total compensation. In addition, if the plaintiff obtains a verdict from the jury or judgment from the Court more favorable than the arbitration order, and the defendant demanded a trial de novo, interest on the amount of the arbitration order shall be made payable in accordance with 6 Del. C. § 2301 beginning with the date of the order."
Superior Court Civil Rule 16.1(k)(11)(iii).
The first sentence of Rule 16.1(k)(11)(iii) assesses the costs of arbitration and the Alternative Dispute Resolution (ADR) Practitioner's total compensation against a party that demands a trial de novo when the party fails to obtain a subsequent jury verdict or judgment from the Court more favorable to the party than the arbitrator's order. Therefore, a party requesting a trial de novo is liable for the costs associated with the prior arbitration, if the subsequent verdict from the jury or judgment from the Court is equal to or less favorable to the requesting party than the arbitrator's initial order. In the case sub judice, Defendant State Farm demanded a trial de novo and failed to obtain a jury verdict or judgment from this Court more favorable to them than the arbitrator's initial order. Consequently, the costs of arbitration and the ADR Practitioner's total compensation fell upon State Farm. These costs were not contested by the Defendant, and State Farm has already paid $261.00 to Plaintiff in satisfaction of this obligation.
The second sentence of Rule 16.1(k)(11)(iii) adds that if the Plaintiff obtains a verdict from a jury or judgment from the Court more favorable than the arbitration order, and the defendant demanded the trial de novo, then interest on the amount of the arbitration order shall be payable in accordance with 6 Del. C. § 2301. Therefore, a Defendant requesting a trial de novo is liable for interest on the amount of the arbitration order, if the subsequent verdict from the jury or judgment from the Court is more favorable to the Plaintiff than the arbitrator's initial order.
The Parties are in dispute concerning liability for the interest on the arbitrator's order, arising under the second sentence of Rule 16.1(k)(11)(iii). State Farm refused to pay Mr. Fraser interest on the arbitrator's order, because the judgment entered after trial was the identical amount awarded in the arbitrator's order. Thus, the judgment entered was not more favorable to the Plaintiff than the arbitrator's order. The Plaintiff asks the Court to interpret the language of the Rule's second sentence to mean "identical or more favorable", instead of simply "more favorable". That way Mr. Fraser could be awarded interest on the arbitrator's order, even though the judgment entered in his favor was for an identical amount. Mr. Fraser argues that the "identical or more favorable" interpretation would promote the Rule's purpose of having cases disposed of by Arbitration and not to have Arbitration Orders frivolously appealed to this Court.
The interest totaled $3,768.20 on September 1, 2006. The Court has received no further information concerning the amount of current interest on the arbitrator's order.
The arbitrator's order and the judgment entered by the Court were both for the amount of $50,240.26.
Courts have discretion to construe statutes only when they are obscure or doubtful in their meaning. Where its language is clear and unambiguous, a statute must be held to mean that which it plainly states, and no room is felt for construction. The second sentence of Rule 16.1(k)(11)(iii) is clear and unambiguous, and it must be held to mean that which it plainly states. Drafters of the Rule clearly intended that there be two distinct standards in determining a party's liability for the costs of arbitration as compared to having to pay interest on the arbitrator's order. The Rule's second sentence clearly and distinctly addresses when interest is payable on the amount of the arbitration order "in addition" to when the costs of the arbitration and the ADR Practitioner's total compensation shall be assessed on a party.
Balma v. Tidewater Oil Comp., 214 A.2d 560, 562 (Del. 1965).
Id.
Plaintiff is entitled to interest on the arbitrator's order based on the plain meaning of Rule 16.1(k)(11)(iii). The Court does not need to interpret the second sentence of the Rule to mean "identical or more favorable" for the Plaintiff to prevail. Pursuant to the second sentence of Rule 16.1(k)(11)(iii), if the Plaintiff obtains a verdict from a jury or judgment from the Court more favorable than the arbitration order, and the Defendant demanded a trial de novo, interest on the amount of the arbitration order shall be payable in accordance with 6 Del. C. § 2301 beginning with the date of the order. In the case sub judice, the Parties agreed to have the jury's verdict entered as a judgment in favor of the Plaintiff for an amount identical to the arbitrator's order ($50,240.26), but the Plaintiff previously obtained a verdict from a jury more favorable than the arbitrator's order ($56,084.54). If either a jury verdict or judgment from the Court is more favorable to the Plaintiff than the arbitrator's order, following the Defendant's demand for a trial de novo, then interest on the amount of the arbitrator's order is payable under 6 Del. C. § 2301. Consequently, Mr. Fraser is entitled to interest on the arbitrator's award, because he obtained a jury verdict more favorable than the arbitrator's order, after State Farm demanded a trial de novo.
IT IS SO ORDERED.