Aetna Casualty & Sur v. Hood ( 2004 )

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 95-60152
Summary Calendar
AETNA CASUALTY & SURETY COMPANY,
Plaintiff-Appellee,
VERSUS
DOROTHY CROSS HOOD, Individually;
as Administratrix of the Estate of
Roger Neal Hood, Deceased, and as
Wrongful Death Beneficiary of Roger
Neal Hood, et al.,
Defendants-Appellants.
Appeal from the United States District Court
For the Northern District of Mississippi
(3:93 CV 139)
August 24, 1995
Before SMITH, EMILIO M. GARZA, and PARKER, Circuit Judges.
PER CURIAM:*
Dorothy Cross Hood, along with other members of the Hood
family ("the Hoods"), appeal the denial of prejudgment interest on
*
Local Rule 47.5 provides: "The publication of opinions that
have no precedential value and merely decide particular cases on
the basis of well-settled principles of law imposes needless
expense on the public and burdens on the legal profession."
Pursuant to that Rule, the Court has determined that this opinion
should not be published.
the proceeds of an automobile insurance policy. We affirm.
FACTS
On July 9, 1993, a wrongful death lawsuit was instituted by
the Hood family seeking compensatory and punitive damages for the
wrongful death of Roger Neal Hood and the injuries to Robert Dale
Hood arising out of an automobile collision. The collision
occurred when a vehicle driven by Kelly Jo Vincent collided with a
vehicle owned and operated by Roger Neal Hood, in which Robert Dale
Hood was a passenger. Roger Neal Hood was killed in the accident
and Robert Dale Hood suffered serious injuries. The automobile
driven by Kelly Jo Vincent was covered by a liability policy issued
by Aetna.
PROCEEDINGS BELOW
On September 2, 1993, Aetna Casualty and Surety Company
("Aetna") filed a Complaint in Interpleader pursuant to Rule 22,
FED. R. CIV. P., naming several members of the Hood family as
individuals with multiple claims to its policy. The policy
provided for single limits liability coverage of $500,000. Aetna's
complaint offered to tender $484,169.20 into the registry of the
court, which amount represented the maximum proceeds for liability
under the policy after subtracting the amounts previously paid by
Aetna for expenses related to the accident. The Hoods filed an
answer to the interpleader action on October 5, 1993, asking that
Aetna "be required to forthwith tender into the court the sum of
§484,169.20, together with interest until paid." On February 16,
1994, the court entered an order granting Aetna leave to deposit
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the policy proceeds with the clerk of court, which Aetna did on
February 25, 1994.
The parties ultimately agreed that the Hoods were entitled to
summary adjudication as to the proposed distribution of the
proceeds, and the court entered judgment in accordance with that
agreement. The district court then entered summary judgment
denying the Hoods prejudgment interest, which order is the subject
of this appeal.
PREJUDGMENT INTEREST
We review the denial of prejudgment interest to determine
whether the district court abused its discretion. Canal Ins. Co.
v. First General Ins. Co., 901 F.2d 45, 47 (5th Cir. 1990).
The district court correctly held that the issue as to the
Hoods' entitlement to prejudgment interest in this diversity case
is governed by the law of Mississippi. Canal Ins. Co. v. First
General Ins. Co., 901 F.2d 45, 47 (5th Cir. 1990). While there is
no Mississippi case directly on point, as a general proposition,
prejudgment interest is allowed by Mississippi law under a variety
of circumstances. See Moss Point v. Miller, 608 So. 2d 1332, 1336
n.4 (Miss. 1992) ("Prejudgment interest may be granted (1) pursuant
to a statute, (2) if a provision in a contract provides or (3)
where the proof is sufficient to support an award of punitive
damages"); Aetna Casualty & Surety Co. v. Doleac Elec. Co., 471
So. 2d 325, 331 (Miss. 1985) ("Under Mississippi law prejudgment
interest may be allowed in cases where the amount due is liquidated
when the claim is originally made, or where denial of the claim is
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frivolous or in bad faith").
The Hoods urge here, as they did below, that the court's
discretion should be guided by the three factors set out in
Gelfgren v. Republic Nat. Life Ins. Co., 680 F.2d 79 (9th Cir.
1982):
...(1) whether the stakeholder unreasonably delayed in
instituting the action or depositing the fund with the
court, (2) whether the stakeholder used the fund for his
benefit and would be unjustly enriched at the expense of
the claimants who have claim to the fund, and (3)
whether the stakeholder eventually deposited the fund
into the court's registry.
Id. at 82 (citations omitted). The district court did, in fact,
consider these factors and determine that, under the circumstances
of this case, (1) Aetna did not unreasonably delay in depositing
the funds into the court registry, (2) Aetna was not unjustly
enriched because the policy proceeds were not "money overdue," and
(3) the fact that Aetna actually made the deposit with the court
while under no legal obligation to even bring this action weighed
in favor of no prejudgment interest award.
While agreeing with the factors used in the district court's
analysis, the Hoods contend that the conclusions reached amount to
abuse of the court's discretion. The Hoods argue that during the
six months between the time Aetna acknowledged liability for the
policy amounts and the time the money was deposited with the court
registry, Aetna controlled the money and profited from any interest
earned. If the funds had been deposited earlier, the court
registry would have invested them in an interest bearing account
during that six months, and the interest would have inured to the
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Hoods' benefit. The Hoods take the position that Aetna
unreasonably delayed and was unjustly enriched by that delay, so
that factors one and two should have been weighed in their favor.
They also argue that liability was established and the funds became
due and owing when Aetna filed its initial interpleader pleading,
relinquishing all claims to the limits of the policy.
We are not convinced that the district court abused its
discretion in finding that a six month delay was not unreasonable
in this case, considering there had been no judicial determination
of liability as to the two competing tort claims and Aetna had no
legal obligation to pay the policy proceeds to the claimants.
Likewise, the district court did not abuse its discretion in
holding that Aetna was not unjustly enriched by failure to deposit
the money during that time.
CONCLUSION
For the foregoing reasons, the district court's order denying
prejudgment interest is AFFIRMED.
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