Brennan-Centrella v. Ritz-Craft Corp. of Pa.

18‐729‐cv(L)
Brennan‐Centrella v. Ritz‐Craft Corp. of Pa.
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
____________________
August Term, 2018
(Argued: April 15, 2019 Decided: November 5, 2019)
Docket Nos. 18‐729‐cv(L), 18‐867‐cv(XAP)
____________________
MARY BRENNAN‐CENTRELLA, CARMINE CENTRELLA,
Plaintiffs‐Counter‐Defendants‐Appellees‐Cross‐Appellants,
v.
RITZ‐CRAFT CORP. OF PENNSYLVANIA,
Defendant‐Cross‐Claimant‐Appellant‐Cross‐Appellee.1
____________________
Before: KEARSE, WINTER, and POOLER, Circuit Judges.
Following a jury trial in the United States District Court for the District of
Vermont (John M. Conroy, M.J.), Mary Brennan‐Centrella and Carmine Centrella
were awarded damages against Ritz‐Craft Corp. of Pennsylvania after a jury
1 The Clerk of Court is directed to amend the caption as above.
found that the company violated the Vermont Consumer Protection Act in
selling and constructing a modular home that the couple purchased for their
retirement, and Ritz‐Craft appealed. After trial, the Centrellas moved to alter the
judgment to include prejudgment interest. The district court denied their motion,
and the Centrellas cross‐appealed. The cross‐appeal raises a novel question of
state law: whether a court may grant prejudgment interest to private litigants
who are awarded compensatory damages under the Vermont Consumer
Protection Act, Vt. Stat. Ann., tit. 9, § 2461(b). Because this question presents a
determinative issue of state law on which there is no clear and controlling
precedent, we certify this question to the Vermont Supreme Court.
We resolve the remaining claims in the appeal and this cross‐appeal by a
separate summary order filed today.
Question certified to the Vermont Supreme Court.
____________________
STEPHANIE DIVITTORE, Barley Snyder LLP (Matthew
S. Borick, Downs Rachlin Martin PLLC, on the brief),
Harrisburg, PA, for Defendant‐Cross‐Claimant‐Appellant‐
Cross‐Appellee.
JOSHUA L. SIMONDS, The Burlington Law Practice,
PLLC (Kathryn G. Kent, Lewis Kent, LLP, on the brief),
2
Burlington, VT, for Plaintiffs‐Counter‐Defendants‐
Appellees‐Cross‐Appellants.
POOLER, Circuit Judge:
Following a jury trial in the United States District Court for the District of
Vermont (John M. Conroy, M.J.), Mary Brennan‐Centrella and Carmine Centrella
were awarded damages against Ritz‐Craft Corp. of Pennsylvania after a jury
found that the company violated the Vermont Consumer Protection Act in
selling and constructing a modular home that the couple purchased for their
retirement, and Ritz‐Craft appealed. After trial, the Centrellas moved to alter the
judgment to include prejudgment interest. The district court denied their motion,
and the Centrellas cross‐appealed. The cross‐appeal raises a novel question of
state law: whether a court may grant prejudgment interest to private litigants
who are awarded compensatory damages under the Vermont Consumer
Protection Act, Vt. Stat. Ann., tit. 9, § 2461(b). Because this question presents a
determinative issue of state law on which there is no clear and controlling
precedent, we certify this question to the Vermont Supreme Court.
We resolve the remaining claims in this appeal and cross‐appeal by a
separate summary order filed today.
3
BACKGROUND
Mary Brennan‐Centrella and Carmine Centrella purchased a modular
home that was constructed in Isle La Motte, Vermont, where the couple intended
to retire. The Centrellas were particularly interested in purchasing an energy‐
efficient home that would meet Vermont’s energy code, and they approached
their search for a modular home builder with this concern at the fore. After
researching options, the Centrellas entered into a contract with Mountain View
Modular Homes, Inc. (“Mountain View”). Mountain View was an affiliated
builder for Ritz‐Craft Corporation of Pennsylvania, Inc. (“Ritz‐Craft”), meaning
that, among other things, Ritz‐Craft supplied modular units for Mountain View’s
builders.
The Centrellas thoroughly researched Ritz‐Craft construction before
purchasing their home and discovered that Ritz‐Craft represented that its
modular homes were energy efficient. In particular, the Centrellas reviewed
information about Ritz‐Craft on Mountain View’s website, which included
several sections detailing Ritz‐Craft homes.2 In one such section, Ritz‐Craft
2At trial, testimony established that Ritz‐Craft provided approved builders, like
Mountain View, with ready‐made websites, and the parties do not dispute that
4
represented that it was an Energy Star partner that was “committed to using
energy efficient building methods and materials” to create environmentally
friendly homes. Supp. App’x at 12. Energy Star‐qualified new homes are
substantially more energy efficient than homes built to the minimum code. The
website further represented that a Ritz‐Craft home would be “built to ALL
applicable Local and State codes and verified by a 3rd party prior to shipment.”
Supp. App’x at 14. Ritz‐Craft’s own website informed consumers that “it is
important to note that all Ritz‐Craft homes are inherently Green and energy
efficient due to our detailed construction methods.” Ex. F to Def.’s Mot. Summ. J.
at 1, Centrella v. Ritz‐Craft Corp. of Pa., No. 2:14‐cv‐111 (D. Vt. Feb. 16, 2016), ECF
No. 63‐7.3
Ritz‐Craft representatives made similar statements to the Centrellas in
person. Mary Brennan‐Centrella testified that she and her husband toured a Ritz‐
Craft factory, where a representative “explained to me that whatever I purchased
Ritz‐Craft created the portions of Mountain View’s website that concern Ritz‐
Craft homes. Trial Tr. at 3‐4, Centrella v. Ritz‐Craft Corp. of Pa., No. 2:14‐cv‐111 (D.
Vt. Dec. 20, 2017), ECF No. 165.
3 All future references to court filings correspond to the district court docket
identified here.
5
from [Ritz‐Craft] was going to have to meet Vermont building codes. So this
would be okay.” App’x at 52.
The Centrellas also learned of Ritz‐Craft’s representations that it engaged
in an integrated process with approved builders and oversaw the entire building
process of its modular units. For example, Ritz‐Craft provided consumers with
“a list of steps” that the company takes to “ensure your home buying process
runs smoothly.” Supp. App’x at 13. One of the items on that list states,
“Approximately 6‐8 weeks after placing the order for your home, it is delivered
to your site. We will then place the home on its foundation, and complete all
outstanding facets of the process—from completing the heating & plumbing
systems, to building the front porch & garage if desired.” Supp. App’x at 13
(emphasis added). The Centrellas also relied on a corporate video that Ritz‐Craft
produced that, according to Carmine Centrella’s testimony, left the impression
that Ritz‐Craft would “guarantee” and “stand[] behind th[e] home” it sold. Supp.
App’x at 101.
The Centrellas decided to contract with Mountain View for a Ritz‐Craft
modular home. However, soon after they moved into the house, they began to
experience issues from the home’s poor construction. Specifically, the problems
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with the home included that if one turned on the heat downstairs, the upstairs
would be heated instead; water leaked onto the upstairs floor and the first floor;
a plumbing inspection revealed code violations in the plumbing and heating
systems, as well as elevated carbon monoxide levels; the upstairs pipes froze;
and the insulation was not installed properly.
Seeking to recoup their losses from purchasing the faulty home, the
Centrellas brought this action against Mountain View and Ritz‐Craft for
violations of, inter alia, the Vermont Consumer Protection Act (“VCPA”), Vt.
Stat. Ann., tit. 9, § 2461(b), and breach of express and implied warranties. The
Centrellas claimed that Mountain View’s and Ritz‐Craft’s representations that
the modular home would be energy efficient and compliant with local energy
codes and that Mountain View and Ritz‐Craft would cooperatively ensure
proper construction of the home were materially misleading. The couple sought
three types of damages on their VCPA claim: (1) judgment “in the amount of the
consideration paid of $246,673 attributable to Defendant or the damages
attributable to Defendant if greater, and occasioned by Defendant’s violation of
the Consumer Protection Act,” (2) “damages suffered by Plaintiffs due to
inconvenience, time and expense for coordinating necessary repairs, excessive
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heating costs, mental anguish, for a reasonable sum for the loss of enjoyment for
the use of the home and for time and expense in prosecuting this action,” and (3)
treble damages. Am. Compl. at 13‐14, ECF No. 77.
Mountain View defaulted while the case was still in the discovery phase,
leaving Ritz‐Craft as the only remaining defendant.
In preparation for trial, the parties submitted a joint trial memorandum,
which included the Centrellas’ statement of damages. The Centrellas sought “the
consideration provided to Ritz‐Craft of approximately $97,000 for its violation of
the VCPA.” Joint Trial Mem. at 32, ECF No. 92. The parties ultimately stipulated
that if the jury found that Ritz‐Craft had violated the VCPA, the Centrellas
would be entitled to $94,262 in damages, which was the amount of consideration
the Centrellas paid to Ritz‐Craft for the modular home. After a five‐day trial, a
jury found that Ritz‐Craft had violated the VCPA and awarded the Centrellas the
stipulated $94,262 in damages. The jury found in favor of Ritz‐Craft on the
Centrellas’ warranty claims.
Thereafter, Ritz‐Craft moved for post‐trial relief under Federal Rules of
Civil Procedure 50 and 59, seeking to challenge the jury verdict on a number of
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grounds. That same day, the Centrellas moved to alter the judgment to include
prejudgment interest and for an award of costs and attorneys’ fees.4
As relevant to this opinion, the district court denied the Centrellas’ motion
for prejudgment interest. The court first observed that “it is at least noteworthy
that although the VCPA contains a provision for an award of ‘reasonable
attorney’s fees,’ it does not contain such a provision for prejudgment interest.”
Centrella v. Ritz‐Craft Corp. of Pa., Inc., No. 2:14‐cv‐111, 2018 WL 840041, at *12 (D.
Vt. Feb. 12, 2018). The district court did not wrestle with whether prejudgment
interest might nonetheless be available on VCPA damages awards because it
concluded that “the amount of damages was not reasonably ascertainable” and
declined to award prejudgment interest. Id. This cross‐appeal followed.
DISCUSSION
Vermont Rule of Appellate Procedure 14(a) permits a federal court to
certify a question of Vermont law to the Vermont Supreme Court “if the answer
might determine an issue in pending litigation and there is no clear and
4With the exception of the Centrellas’ motion seeking prejudgment interest, the
parties’ appeals of issues at trial and of the district court’s decisions on post‐trial
motions are resolved by a summary order issued simultaneously.
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controlling Vermont precedent.” Vt. R. App. P. 14(a). Reciprocally, Second
Circuit Local Rule 27.2 provides that this “court may certify a question of state
law to that state’s highest court.” 2d Cir. L.R. 27.2. This Court may certify a
question to afford the state court “the first opportunity to decide significant
issues of state law,” and we have done so when a question “presents purely state
law issues, controls the outcome of th[e] case, and lacks controlling precedent.”
Preseault v. City of Burlington, 412 F.3d 96, 102 (2d Cir. 2005) (internal quotation
marks omitted).5
The case before us presents a dispositive question of pure state law for
which there is no clear and controlling Vermont precedent: whether a court may
grant prejudgment interest to private litigants who are awarded compensatory
damages under the Vermont Consumer Protection Act, Vt. Stat. Ann., tit. 9,
§ 2461(b).
I. Prejudgment Interest in Vermont
5We have also considered “the importance of the issue to the state” as a factor to
weigh in deciding whether to certify a question. Hunt Constr. Grp., Inc. v. Brennan
Beer Gorman/Architects, P.C., 607 F.3d 10, 13 (2d Cir. 2010) (internal quotation
marks omitted). However, we have not uniformly discussed this factor “because
the state court to whom the question is certified, in deciding whether to accept
certification, can best evaluate that for itself.” Id. at 13 n.3.
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Vermont Rule of Civil Procedure 54(a) creates a right to prejudgment
interest as a component of a judgment in certain circumstances. In relevant part,
Vermont Rule 54(a) states that: “[i]n an action where monetary relief is awarded,
the amount of the judgment shall include the principal amount found to be due,
all interest accrued on that amount up to and including the date of entry of judgment,
and all costs allowed to the prevailing party.” Vt. R. Civ. P. 54(a) (emphasis
added). The reporter’s notes to Rule 54(a) explain that, as relevant here, one type
of available interest is “[i]nterest awarded as damages for detention of money
due for breach or default.” Id. Reporter’s Notes—1981 amendment. This type of
“interest is awarded as of right when the principal sum recovered is liquidated
or capable of ready ascertainment.” Id. It may also “be awarded in the court’s
discretion for other forms of damage”—i.e., damages that are not liquidated or
readily ascertainable. Id.
The Vermont Supreme Court has subsequently interpreted Rule 54(a) to
“mandate the award of prejudgment interest in cases where damages are
liquidated or readily ascertainable at the time of the tort and allow prejudgment
interest in the trial court’s discretion where such an award is required to make
the plaintiff whole.” Smedberg v. Detlef’s Custodial Serv., Inc., 182 Vt. 349, 365
11
(2007) (internal quotation marks omitted); see also Heath v. Palmer, 181 Vt. 545, 551
(2006).
These cases reflect the Vermont legislature’s policy choice that plaintiffs
are not fully compensated unless they can recover the interest that accrues on
reasonably ascertainable damages. “Prejudgment interest on compensatory
damage awards is meant to restore—to the extent possible—harmed plaintiffs to
the financial position they would have enjoyed but for the tort . . . .” Smedberg,
182 Vt. at 366. Put differently, where damages are compensatory, “[p]laintiffs
who are awarded interest will be made whole; those not awarded interest will
not, contrary to the purpose of compensatory damages.” d’Arc Turcotte v. Estate of
LaRose, 153 Vt. 196, 199 (1989).
II. The Vermont Consumer Protection Act
The question we certify concerns the interaction of the general rule in
Vermont that prejudgment interest is available on reasonably ascertainable
damages and Vermont’s consumer protection laws, which “were passed to
protect th[e] state’s citizens from unfair and deceptive business practices.”
Gramatan Home Inv’rs Corp. v. Starling, 143 Vt. 527, 536 (1983). The VCPA
prescribes statutory remedies for private litigants “in order to promote and
12
encourage prosecution of individual consumer fraud claims.” Id. Specifically, the
VCPA provides that injured private parties
may sue for appropriate equitable relief and may sue and recover
from the seller, solicitor, or other violator the amount of his or her
damages, or the consideration or the value of the consideration
given by the consumer, reasonable attorney’s fees, and exemplary
damages not exceeding three times the value of the consideration
given by the consumer.
Vt. Stat. Ann., tit. 9, § 2461(b). The statute does not provide for prejudgment
interest on a damages award, and therein lies the problem.
As a matter of statutory construction, we presume that the legislature
follows the principle of expressio unius est exclusio alterius—that is, “mention of
one impliedly excludes others.” Greene v. United States, 79 F.3d 1348, 1355 (2d Cir.
1996). Applying this canon of construction, “it would be strange” for the statute
to mention specifically several remedies (e.g., equitable relief, damages,
attorney’s fees, and exemplary damages) while leaving prejudgment interest “to
implication.” Bruesewitz v. Wyeth LLC, 562 U.S. 223, 232 (2011). The expressio
unius principle instead encourages us to interpret Section 2461(b) as the Vermont
legislature’s intent to exclude prejudgment interest from the available remedies a
private litigant may recover under the VCPA.
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However, we have equally noted that “[t]he maxim expressio unius est
exclusio alterius is only an aid to statutory construction, not a rule of law,” making
the principle “an uncertain guide to interpretation.” Westnau Land Corp. v. U.S.
Small Bus. Admin., 1 F.3d 112, 116 (2d Cir. 1993) (alterations omitted) (internal
quotation marks omitted). We are particularly aware of the shortcomings of this
canon here because its application to the VCPA disturbs Vermont’s general rule
that prejudgment interest is available as a component of a judgment of
reasonably ascertainable damages, see Winey v. William E. Dailey, Inc., 161 Vt. 129,
141 (1993). Without the Vermont Supreme Court’s consideration of whether
prejudgment interest can be awarded to private litigants who incur reasonably
ascertainable compensatory damages under the VCPA, we are thus inclined not
to resolve this issue in the first instance.
III. Vermont Superior Court Decisions
While the Vermont Supreme Court has never opined on the issue before
us, Vermont’s superior courts have awarded prejudgment interest to private
litigants who were victorious on VCPA claims at least three times. Of those three
awards, only one superior court decision, Vastano v. Killington Valley Real Estate,
No. 751‐12‐01 Rdcv, 2008 WL 2937171 (Vt. Super. Ct. Jan. 10, 2008) (trial order),
14
aff’d on other grounds, 187 Vt. 628 (2010), has analyzed the propriety of granting
prejudgment interest on reasonably ascertainable damages awards under the
VCPA. In Vastano, a superior court considered, inter alia, whether prejudgment
interest was available to plaintiffs who brought a successful action under the
Vermont Consumer Fraud Act6 challenging the misrepresentations of a real
estate broker. Notably, the plaintiffs in Vastano were seeking to disgorge the real
estate broker’s fees rather than receive compensatory damages, as they had
resold the property in question for a profit. Id. The court determined that the
punitive and deterrent purposes of the VCPA required the broker of the property
to disgorge the consideration that plaintiffs paid to it. Id. The court then
concluded that, “[w]ith respect to prejudgment interest, the deterrent policy of
policing the marketplace is best implemented by the usual rule that prejudgment
interest applies.” Id.
In two other cases, Vermont superior courts have granted prejudgment
interest on VCPA damages awards without analysis of the issue. Parizo v. Nuovo,
No. 62‐1‐15 Cncv (Vt. Super. Ct. Oct. 17, 2017) (trial order), available at Pls.’ Reply
6The Vermont Consumer Protection Act was known as the Consumer Fraud Act
until 2012. McKinstry v. Fecteau Residential Homes, Inc., 200 Vt. 392, 394 n.1 (2015).
15
Resp. Mot. Alter J. Prejudgment Interest at 5, ECF No. 154‐2, and L’Esperance v.
Benware, No. S0367‐98RcC, 2001 WL 36150759 (Vt. Super. Ct. Sept. 28, 2001) (trial
order), aff’d on other grounds, 175 Vt. 292 (2003). Thus, we have only the analysis
of a single Vermont superior court and the example of two others to guide our
resolution of the question before us, and we lack controlling precedent to apply
to this case.
IV. State Policy Choices
In addition to our legal quandary on the proper interpretation of Vermont
law, we consider certification appropriate in this case because the availability of
prejudgment interest on a successful private VCPA action presents a question
that “may require value judgments and public policy choices.” Pasternack v. Lab.
Corp. of Am. Holdings, 807 F.3d 14, 19 (2d Cir. 2015) (internal quotation marks
omitted). The VCPA is a public‐facing statute: its purpose is “to protect the
public and to encourage fair and honest competition.” Vt. Stat. Ann., tit. 9,
§ 2451; Gramatan, 143 Vt. at 536. The state legislature fashioned specific remedies
to accomplish this goal, see Vt. Stat. Ann., tit. 9, § 2461(b), and the presence of
such remedies in the statute’s text suggests that the legislative body reached a
value judgment on the types of remedies that it considered necessary to
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accomplish the VCPA’s goals, cf. Barnhart v. Peabody Coal Co., 537 U.S. 149, 168
(2003) (explaining the expressio unius canon justifies an “inference that items not
mentioned were excluded by deliberate choice, not inadvertence” (internal quotation
marks omitted) (emphasis added)).
To that end, the Vermont Supreme Court has noted that the remedies
available to victims of consumer fraud were “fashioned in order to promote and
encourage prosecution of individual consumer fraud claims.” Gramatan, 143 Vt.
at 536. The availability of prejudgment interest will impact the potential
remedies for private litigants and perhaps the incentives to bring suit under the
VCPA. The possible exposure to prejudgment interest could also add to sellers’
incentive not to violate the VCPA. These state policy concerns support our
decision to request the Vermont Supreme Court’s guidance on the question
before us.
V. The Question Is Determinative of the Issue Before This Court
Lastly, the Vermont Supreme Court’s resolution of the question will be
determinative of whether the Centrellas are entitled to prejudgment interest
because the Centrellas’ damages were “reasonably ascertainable” because they
were stipulated. Prejudgment “interest is awarded as of right when the principal
17
sum recovered is liquidated or capable of ready ascertainment.” Bull v. Pinkham
Eng’g Assocs., Inc., 170 Vt. 450, 463 (2000) (internal quotation marks omitted).
In this case, the Centrellas and Ritz‐Craft stipulated that the amount of
damages to which the Centrellas would be entitled if they received a favorable
verdict against Ritz‐Craft was $94,262, and plaintiffs seek prejudgment interest
on that sum. Therefore, the principal sum of the Centrellas’ damages was
reasonably ascertainable. If prejudgment interest is permissible on private
litigants’ reasonably ascertainable VCPA damages awards, the Centrellas would
be entitled to prejudgment interest as of right, making this state‐law question
determinative of the issue before us.
CONCLUSION
In sum, the question before us presents an issue of state law, there is no
clear and controlling Vermont precedent on the question, and the answer to the
question will determine whether the Centrellas are entitled to prejudgment
interest in this case. We therefore respectfully invite the Vermont Supreme Court
to answer the following question of Vermont law:
Whether a court may grant prejudgment interest to private litigants
who are awarded compensatory damages in an amount to which the
18
parties have stipulated under the Vermont Consumer Protection
Act, Vt. Stat. Ann., tit. 9, § 2461(b)?
The Vermont Supreme Court may reformulate the question or expand it to
address other pertinent issues of state law. Vt. R. App. P. 14(b). This panel will
retain jurisdiction over the appeal after the Vermont Supreme Court has accepted
or declined certification. 2d Cir. L.R. 27.2.
It is hereby ORDERED that the Clerk of this Court transmit to the Vermont
Supreme Court a Certificate, as set forth below, together with a complete set of
the briefs, appendices, and record filed by the parties in this Court.
CERTIFICATE
The foregoing is hereby certified to the Vermont Supreme Court pursuant
to Second Circuit Local Rule 27.2 and Vermont Rule of Appellate Procedure 14,
as ordered by the United States Court of Appeals for the Second Circuit.
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