Pac-Van, Inc. v. Wekiva Falls Resort

FOR PUBLICATION
ATTORNEY FOR APPELLANT:
FILED
Sep 11 2012, 9:16 am
DANIEL D. BOBILYA
Bobilya Law Group, LLC CLERK
of the supreme court,
court of appeals and
Fort Wayne, Indiana tax court
IN THE
COURT OF APPEALS OF INDIANA
PAC-VAN, INC., )
)
Appellant-Defendant, )
)
vs. ) No. 49A02-1204-CT-337
)
WEKIVA FALLS RESORT, )
)
Appellee-Plaintiff. )
APPEAL FROM THE MARION SUPERIOR COURT
The Honorable David J. Dreyer, Judge
Cause No. 49D10-0909-CT-040509
September 11, 2012
OPINION - FOR PUBLICATION
SHEPARD, Senior Judge
When the losing party pays a judgment in full, does post-judgment interest keep
running on the whole amount until the trial court calculates the amount due for the
period between the judgment and the payment? The trial court here said yes. The
statute and the cases are otherwise.
FACTS AND PROCEDURAL HISTORY
Wekiva Falls Resort sued Pac-Van, Inc., for breach of contract and negligence.
On April 15, 2011, a jury returned a verdict for Wekiva in the amount of $102,285. Pac-
Van paid the judgment on June 2, 2011. Wekiva also requested an award of attorney’s
fees. On July 19, 2011, the trial court ordered Pac-Van to pay $123,379 in fees. Pac-Van
paid the award to Wekiva on August 22, 2011.
Wekiva then filed a petition for pre-judgment and post-judgment interest. Pac-
Van responded, noting that it had already paid both the jury verdict and the attorney’s
fees award. On January 23, 2012, the trial court denied Wekiva’s request for pre-
judgment interest but granted post-judgment interest, determining that Wekiva was
entitled to $6368.27 in interest on the jury verdict and $5075.81 in interest on the
attorney’s fees award.1
Pac-Van filed a motion to correct error, asserting that the award of post-judgment
interest did not account for Pac-Van’s payment of the judgment and the fee award. Pac-
Van’s lawyer Daniel D. Bobilya had first contacted Wekiva’s attorney Daniel Cueller on
1
The trial court’s denial of Wekiva’s request for pre-judgment interest rested on Ind. Code § 34-51-4-6(1998). That section bars interest where a pre-trial offer of settlement is more than a third higher than the
eventual judgment. Wekiva had offered to settle for $1.4 million; the jury awarded $102,285.
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this point. “Although opposing counsel was made aware of the error and has
acknowledged receipt of the principal payments,” Bobilya informed the trial court, “he
refused to voluntarily remedy this error via stipulation.” Appellant’s App. p. 3. The
motion to correct error did not elicit a response, the motion was deemed denied, and this
appeal followed. Wekiva has not filed an appellee’s brief.
ISSUE
Pac-Van raises one issue, which is: whether the trial court erred in the calculation
of post-judgment interest on the jury verdict and the attorney’s fees award.
DISCUSSION
We start with the trial court’s calculation of post-judgment interest on the jury
verdict. The governing statute provides, in relevant part, “interest on judgments for
money whenever rendered shall be from the date of the return of the verdict or finding of
the court until satisfaction at . . . an annual rate of eight percent (8%), if there was no
contract by the parties.” Ind. Code § 24-4.6-1-101 (1993). This statute creates an
incentive for judgment debtors to satisfy their obligations expeditiously to avoid the
accrual of interest. Poehlman v. Feferman, 717 N.E.2d 578, 583 (Ind. 1999).
Here, the jury rendered its verdict on April 15, 2011, and Pac-Van paid the
judgment on June 2, 2011, forty-eight days later. Under the plain language of Section 24-
4.6-1-101, post-judgment interest accrued during that period of time. See State v.
Booher, 935 N.E.2d 274, 282 (Ind. Ct. App. 2010) (holding that interest accrued between
the date the trial court entered final judgment and the date the judgment was paid in full).
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The interest does not compound because the statute does not permit interest to accrue
upon interest. Nesses v. Kile, 656 N.E.2d 546, 547 (Ind. Ct. App. 1995).
Thus, the post-judgment interest due on the jury verdict of $102,285 is calculated
by multiplying that figure by .08 (the interest rate),2 dividing the result ($8182.80) by 365
to determine the amount of interest that accrues each day, and multiplying that result
($22.42) by forty-eight days to reach the total amount: $1076.09. The trial court’s award
imposed interest running for some eight months after “satisfaction” of the jury verdict, to
use the word in the Code, had already occurred. This was error.
Next, we turn to the trial court’s calculation of interest on the attorney’s fees
award. Such modest authority as exists in Indiana holds that post-judgment interest does
accrue on an award of fees. See Olcott Int’l & Co. v. Micro Data Base Sys., Inc., 793
N.E.2d 1063, 1079 (Ind. Ct. App. 2003), trans. denied. This is also the rule in other
jurisdictions. See Parker v. I & F Insulation Co., 730 N.E.2d 972, 977-78 (Ohio 2000)
(collecting cases). It was the position of both parties before the trial court that an award
of fees is governed by the general post-judgment interest statute cited above, Ind. Code §
24-4.6-1-101.
Here, the trial court issued its fee award on July 19, 2011, and Pac-Van paid
Wekiva the full amount on August 22, 2011, thirty-four days later. Thus, post-judgment
interest on the attorney’s fees award of $123,379 is calculated by multiplying that figure
by .08 (the interest rate), dividing the result ($9870.32) by 365 to determine the amount
2
The parties acknowledged in the trial court that the applicable interest rate is eight percent.
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of interest that accrues each day, and multiplying that result ($27.04) by thirty-four to
reach the total due: $919.43. The trial court’s award of interest on fees for five months
after the fees were paid was error.
CONCLUSION
We reverse the trial court’s award of post-judgment interest and remand with
instructions to issue a new order reflecting $1076.09 in interest on the verdict and
$919.43 in interest on the fees, for a total of $1995.52.
Reversed and remanded with instructions.
KIRSCH, J., and CRONE, J., concur.
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