Opinion
CV105033401S
11-16-2018
Rochelle MYRICK, Administrator of the Estate of Ensley E. Myrick and Tara Reed, Administrator of the Estate of Joseph E. Reed and Anthony Perelli v. JACK A. HALPRIN, INC. et al.
UNPUBLISHED OPINION
Wilson, J.
STATEMENT OF CASE AND PROCEDURAL HISTORY
The plaintiffs, Rochelle Myrick, Administrator of the Estate of Ensley E. Myrick, Tara Reed, Administrator of the Estate of Joseph E. Reed, and Anthony Perrelli, commenced this wrongful death and premises liability action against the defendants, Jack A. Halprin, Inc. (Halprin) and Catwalk, LLC by service of writ, summons and complaint. At the conclusion of the plaintiffs’ case in chief, the defendants moved for a directed verdict which this court denied. On March 9, 2018, the jury returned a verdict in favor of the plaintiffs against the defendant Halprin, and found the defendant Halprin 100% liable. The jury returned a verdict in favor of Catwalk. The jury awarded economic damages in the amount of $18,830.59 to the estate of Ensley Myrick; $5,715 to the estate of Joseph Reed; and $1,002 to Anthony Perelli. With respect to noneconomic damages, the jury awarded Myrick and Reed each, $25,000 and Perelli, $50,000. The plaintiffs, Myrick and Reed filed a motion to set aside the verdict and for an additur. The defendant Halprin filed a motion for judgment notwithstanding the verdict and a motion to set aside verdict. On November 1, 2018, the court denied the plaintiffs’ motion for an additur. The plaintiffs Reed and Myrick have appealed the court’s denial of their motion to set aside. On November 16, 2018, the court denied the defendant’s motions for judgment notwithstanding the verdict and motion to set aside the verdict. Pursuant to General Statutes § 37-3b, the plaintiff, Anthony Perelli filed a motion for postjudgment interest at 10% percent. The defendant has a filed an objection to the plaintiff’s motion for postjudgment interest and requests the court to set a rate of postjudgment interest lower than 10%. The court heard oral argument on the motion at short calendar on April 16, 2018.
On November 2, 2018, the court filed a Corrected Memorandum of Decision to add the title "Memorandum of Decision" to its decision dated November 1, 2018.
The plaintiff filed his motion pursuant to General Statutes § 37-3a which he conceded during oral argument was the incorrect statutory provision for postjudgment interest applicable in the present case. The correct provision is § 37-3b.
Due to an unexpected death in the court’s family, the court requested the parties to waive the 120-day statutory time requirement within which the court has to issue its decision. The court requested the party to waive the date for 90 days to November 16, 2018. All parties agreed and filed written waivers.
I
DISCUSSION
Pursuant to General Statutes § 37-3b the plaintiff has filed a motion for postjudgment interest and requests this court to set the postjudgment interest rate at the maximum rate of 10 percent. Plaintiff argues that the maximum rate is appropriate because the defendant is a "commercial enterprise" and owner of "commercial income producing property." The plaintiff argues that in order to insure payment of his judgment, interest at the maximum rate of 10% is appropriate. The defendant is a registered Connecticut corporation and the owner of the premises which the subject of the lawsuit. The defendant has tenants including Catwalk, the co-defendant in the present case. The defendant has objected to the plaintiff’s motion for postjudgment interest and the court setting the rate of interest at 10 percent. The defendant acknowledges that postjudgment interest may be awarded in the discretion of the court in negligence actions pursuant to General Statutes § 37-3b. However, the defendant claims that the plaintiff’s motion for postjudgment interest should be denied for the following reasons: a. Liability in the case was greatly disputed by the defendants and will likely be the subject of postjudgment motions and possible appeals; b. Plaintiffs claim that the maximum award should be granted based on the fact that the defendant is a commercial enterprise and the owner of commercial income producing property should not be considered in a negligence claim where the standing of the defendant should be treated equally to an individual person; and c. Plaintiff’s claim concerning income from the property is not based on any factual evidence. In support of its objection, the defendant submitted the affidavit of Martin B Halprin, Vice President of the defendant Jack A. Halprin, Inc. as to the current rental income, showing that the building, which is the only corporate asset, is operating at a deficit. The defendant has also submitted for the court’s consideration current interest rates for security deposits under Connecticut landlord tenant law and the current Certificate of Deposit (CD) rates in Connecticut.
A
Scope of the Court’s Discretion
The current version of § 37-3b, in relevant part, provides: "For a cause of action arising on or after May 27, 1997, interest at the rate of ten percent a year, and no more, shall be recovered and allowed in any action to recover damages for injury to the person, or to real or personal property, caused by negligence, computed from the date that is twenty days after the date of judgment or the date that is ninety days after the date of verdict, whichever is earlier, upon the amount of the judgment." (Emphasis added.) This version of the statute, amended in 1997, "replac[ed] the word ‘may’ with ‘shall, ’ thereby evidencing an intent that postjudgment interest not exceeding 10 percent is mandatory for actions governed by the statute as amended." DiLieto v. County Obstetrics & Gynecology Group, P.C., 310 Conn. 38, 48, 74 A.3d 1212 (2013) (DiLieto III). There is "no doubt that the legislature, in amending the statute, was seeking to convert § 37-3b from a statute that permitted an award of postjudgment interest in the discretion of the trial court into one that mandates such an award." DiLieto III, supra, 48.
Clearly, following DiLieto III, the trial court must grant postjudgment interest in actions governed by the current version of § 37-3b. DiLieto III also supports the conclusion that 10 percent is not a mandatory interest rate; instead, it represents the maximum rate that a trial court may award. This is in accordance with statutory interpretation, which requires the court to first look to "the text of the statute itself and its relationship to other statutes." General Statutes § 1-2z. In concluding that the current version of § 37-3b mandates postjudgment interest, the Supreme Court in DiLieto III compared the amended version of the statute to its immediate predecessor, which read: "For a cause of action arising on or after October 1, 1981, interest at the rate of ten percent a year, and no more, may be recovered and allowed in any action to recover damages for injury to the person, or to real or personal property, caused by negligence, computed from the date of judgment." (Emphasis added.) General Statutes (Rev. to 1995) § 37-3b. Although, as the court pointed out in DiLieto III, the legislature amended the statute by changing the word "may" to "shall," the legislature did not amend or remove the phrase "at the rate of ten percent a year, and no more."
In DiLieto III, the Supreme Court analyzed a previous version of § 37-3b which allowed for greater discretion.
"In interpreting [statutory] language ... [courts] do not write on a clean slate, but are bound by ... previous judicial interpretations of [the] language and ... purpose of the statute." (Internal quotation marks omitted.) Commissioner of Public Safety v. Freedom of Information Commission, 312 Conn. 513, 527, 93 A.3d 1142 (2014). In Sears Roebuck & Co. v. Board of Tax Review, 241 Conn. 749, 699 A.2d 81 (1997), the Supreme Court interpreted the meaning of the phrase "at the rate of ten percent a year, and no more," albeit in the context of General Statutes § 37-3a, which governs the interest rate recoverable as damages in certain civil actions. Sears Roebuck & Co. v. Board of Tax Review, supra, 241 Conn. 764. The Supreme Court explained: "It is a basic tenet of statutory construction that the legislature did not intend to enact meaningless provisions ... [I]n construing statutes, we presume that there is a purpose behind every sentence, clause, or phrase used in an act and that no part of a statute is superfluous ... It is true that the language now codified at § 37-3a has undergone numerous revisions and that, at an earlier point, this language arguably was phrased in more emphatic terms ... Over the course of these revisions, however, the legislature has seen fit neither to delete ‘and no more’ nor to include language barring the judiciary from awarding interest below the stated rate. Under these circumstances, we decline to negate, judicially, the significance of the phrase ‘and no more’ by holding that § 37-3a fixes the rate of prejudgment interest at 10 percent. We conclude instead that, consistent with its plain language, § 37-3a establishes a maximum rate above which a trial court should not venture in the absence of specific legislative direction." (Citations omitted; footnote omitted; internal quotation marks omitted.) Sears Roebuck & Co. v. Board of Tax Review, supra, 241 Conn. 765-66.
Adopting the Supreme Court’s methodology in analyzing the meaning of "and no more" as used in § 37-3a results in the same conclusion as to the meaning of the exact phrase as used in § 37-3b. First, the language now codified at § 37-3b has undergone revisions, however, the legislature has neither deleted "and no more" nor included language barring the judiciary from awarding interest below 10 percent. Second, to conclude that the stated rate is mandatory would be to render "and no more" superfluous and thus would violate a cardinal maxim of statutory interpretation. Furthermore, considering the relationship between § 37-3a and § 37-3b, that they include identical language and are successive sections within the same chapter, supports simply applying the Supreme Court’s holding regarding "and no more" as used in § 37-3a to the same phrase in § 37-3b. This conclusion is further supported by comparing § 37-3a and § 37-3b to § 37-1, the first section of the "Interest" chapter. In § 37-1, the legislature set the legal rate of interest at 8 percent. Clearly, the legislature is quite capable of setting a specific and mandatory interest rate when it intends to do so. See Lyon v. Jones, 104 Conn.App. 547, 556, 935 A.2d 201 (2007), aff’d in part, rev’d in part, 291 Conn. 384, 968 A.2d 416 (2009). Therefore, based on DiLieto III, the text of the statute itself, and its relationship to other statutes, 10 percent is not a mandatory rate. To the contrary, the court has discretion to award interest at a rate of up to 10 percent.
B
Factors the Court May Consider
In determining what interest rate to award, the court may consider any factors that it deems relevant. In DiLieto v. County Obstetrics & Gynecology Grp., P.C., 316 Conn. 790, 114 A.3d 1181 (2015) (DiLieto IV), the Supreme Court explained: "Section 37-3b authorizes an award of postjudgment interest at an annual rate of up to 10 percent and does not purport to restrict the discretion of the trial court to choose any rate within that range. We must presume that, if the legislature had intended to allow postjudgment interest at a rate not to exceed the interest rates applicable to United States Treasury securities, or had intended to link interest under the statute to any other economic indicator, it would have expressed that intent explicitly ... The fact that the legislature has linked interest rates to United States Treasury securities in other statutes is strong evidence that it did not intend to do so for purposes of § 37-3b ... General Statutes § 37-3c, the provision governing the rate of interest recoverable in condemnation cases, provides in relevant part that ‘interest shall be calculated from the date of taking at an annual rate equal to the weekly average one-year constant maturity yield of United States Treasury securities, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding the date of taking ... Section 37-3c demonstrates that the legislature will link interest rates to specific economic indicators when it concludes that it is appropriate to do so. In the absence of similar language in § 37-3b, we will not impute to the legislature an intent to limit the court’s discretion in the same manner as it has under § 37-3c ... It is not unreasonable for the legislature to permit courts to consider potential investment income in choosing a fair rate of interest under § 37-3b ... For all of the foregoing reasons, we reaffirm our prior interpretation of § 37-3b as affording the court broad authority to award postjudgment interest at a rate not to exceed 10 percent per annum. As we also have observed previously, the authority vested in the court under § 37-3b includes the discretion to consider any factors bearing on its decision with respect to an award under that provision." (Citations omitted; footnote omitted.) DiLieto IV, supra, 803-07.
The court was discussing the previous version of § 37-3b.
The Supreme Court has provided language regarding the purpose of postjudgment interest which guides this court’s analysis. In DiLieto III, the court stated: "A court’s discretion must be informed by the policies that the relevant statute is intended to advance ... [R]egardless of whether a statute provides for mandatory or discretionary postjudgment interest, the policy behind any such provision is to compensate the successful party for the loss of the use of the money that he or she is awarded from the time of the award until the award is paid in full." (Citations omitted; internal quotation marks omitted.) DiLieto III, supra, 310 Conn. 55.
As to the rate of interest, the court believes it has considerable discretion within the following boundaries: the maximum allowable rate is ten percent annually, and as set forth above, the court is not obligated to order any interest. The court agrees with Judge Povodator’s analysis in Rigakos v. Oneill, Superior Court, judicial district of Stamford-Norwalk, Docket No. FSTCV-166027436S (October 11, 2017, Povodator, J.) , in coming to an appropriate postjudgment interest rate. He noted "[w]hile a trial court is permitted, as appropriate, to apply a 10% rate, this court more typically starts with the analysis set forth in a decision of Judge Adams in Alarmax Distributors, Inc. v. New Canaan Alarm Company, Inc., J.D. Stamford, FST CV-09-5012255S, 2013 WL 3613890 (June 19, 2013) (after remand, 141 Conn.App. 319 (2013) ) (court looked at the federal funds rate, prime rate and CD rate to determine appropriate interest of 4%). Using the financial analysis in that decision as a starting point, and recognizing that interest rates have not changed substantially in the last 4 years, this court usually has determined that an interest rate in the 4-6% range is appropriate (when interest is to be awarded). DiLieto (316 Conn. 790) recognizes that a trial court may consider a variety of evidence, relating to a determination of the proper interest rate." The court also pointed out that the Appellate Court "just recently, in Riley v. Travelers Home & Marine Insurance Co., 173 Conn.App. 422, 458-62 (2017), ... discussed the issue of an appropriate rate of interest under § 37-3a, rejecting the claim that 10% is the presumptive rate (at page 461). The Appellate Court referred to the trial court’s observation that the prevailing rate of interest as awarded by trial courts (in 2014) was in the range of 3-6%, consistent with Alarmax and this court’s recent approach to interest awards. As noted in Riley, the court may take these ranges into consideration, but must fashion an appropriate rate based on the record before it, and the court has done so."
Information from the Federal Reserve shows that on June 13, 2018, the federal funds rate was 2.0% which the federal reserve has just increased to 2.25% as of September 26, 2018. Based on prior federal funds rates for December 2016 (.075%); March 2017 (1.0%); June 2017 (1.25%); December 2017 (1.5%); and March 2018 (1.75%) the federal fund rates have been trending upward, however they still remain low. www.federalreserve.gov. The current prime rate as of September 2018 is 5.25%. www.federalreserve.gov. As of April 2018, a one-year Certificate of Deposit earned 0.83% and the rental security deposit interest rate in Connecticut is 0.09%. Accordingly, the court finds that the postjudgment interest rate of 5% to be appropriate.
CONCLUSION
With the above legal principles in mind, and having reviewed the evidence submitted by the parties in support of their claims, the court hereby sets the rate of postjudgment interest running from June 7, 2018, to the date of payment of judgment, at 5 percent. It is so ordered.