Richard Ringer v. Joseph F. John

IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
January 2013 Term
FILED
April 2, 2013
No. 11-1325 released at 3:00 p.m.
RORY L. PERRY II, CLERK
SUPREME COURT OF APPEALS
OF WEST VIRGINIA
RICHARD RINGER,
Defendant Below, Petitioner
v.
JOSEPH F. JOHN,
Plaintiff Below, Respondent
Appeal from the Circuit Court of Preston County
Honorable Larry V. Starcher, Special Judge
Civil Action No. 09-C-225
REVERSED AND REMANDED
Submitted: February 5, 2013
Filed: April 2, 2013
William C. Brewer, Esq. Peter D. Dinardi, Esq.
J. Tyler Slavey, Esq. Morgantown, West Virginia
J. Brandon Shumaker, Esq. Attorney for Respondent
Brewer & Giggenbach, PLLC
Morgantown, West Virginia
Attorneys for Petitioner
The Opinion of the Court was delivered PER CURIAM.
SYLLABUS BY THE COURT
1. “The standard of review applicable to an appeal from a motion to alter
or amend a judgment, made pursuant to W. Va. R. Civ. P. 59(e), is the same standard that
would apply to the underlying judgment upon which the motion is based and from which the
appeal to this Court is filed.” Syl. Pt. 1, Wickland v. American Travellers Life Ins. Co., 204
W.Va. 430, 513 S.E.2d 657 (1998).
2. “Where the issue on an appeal from the circuit court is clearly a question
of law or involving an interpretation of a statute, we apply a de novo standard of review.”
Syl. Pt. 1, Chrystal R.M. v. Charlie A.L., 194 W.Va. 138, 459 S.E.2d 415 (1995).
3. “In an action founded on contract, a claimant is entitled to have the jury
instructed that interest may be allowed on the principal due, W.Va.Code, 56-6-27 [1923], but
is not entitled to the mandatory award of interest contemplated by W.Va.Code, 56-6-31
[1981], since this statute does not apply where the rule concerning interest is otherwise
provided by law.” Syl. Pt. 4, Thompson v. Stuckey, 171 W.Va. 483, 300 S.E.2d 295 (1983).
Per Curiam:
The petitioner and counterclaim plaintiff below, Richard Ringer, appeals a final
order of the Circuit Court of Preston County entered on August 18, 2011, denying his motion
to amend the judgment order in this civil action for breach of contract and unjust enrichment.
In this appeal, Mr. Ringer contends that the circuit court erred in determining the date of
accrual for pre-judgement interest and also utilized an incorrect prejudgment interest rate.
Upon consideration of the parties’ arguments, the submitted record, and the pertinent
authorities, the final order is reversed, and this case is remanded for further proceedings
consistent with this opinion.
I. Factual and Procedural Background
This case arose out of 2007 verbal agreement entered into by Mr. Ringer and
the respondent and counterclaim defendant below, Joseph F. John, to construct a subdivision
on a parcel of land in Preston County. Mr. John purchased the property for the subdivision
and was going to finance the project. Mr. Ringer, a contractor, was responsible for
constructing roads and excavating the subject property. Disagreements arose between the
parties, however, and the subdivision was never completed.
1
In 2010, Mr. John filed this civil action against Mr. Ringer asserting that he had
failed to make payments on an endloader that had been purchased for the project. Mr. John
alleged that he had purchased the endloader to use in excavating the property and that Mr.
Ringer agreed to buy it from him by making monthly payments. Mr. John claimed that Mr.
Ringer had possession of the endloader and had not made all of the payments that were due.
After Mr. John filed suit, Mr. Ringer filed a counterclaim against him for unjust enrichment
based on the excavation services he performed on the subdivision property.
The case proceeded to trial in June 2011. The jury returned a verdict in favor
of Mr. John with regard to the endloader. The jury also found in favor of Mr. Ringer with
regard to his counterclaim and awarded him damages. In particular, Mr. Ringer was awarded
$20,000 for stone; $5,000 for excavation services; $100 for a percolation test; $500 for the
earnest money he put towards the purchase of the property; and $16,500 for the storage of
topsoil for a total of $42,100. Thereafter, the court ruled that Mr. Ringer’s damages were
special damages1 pursuant to West Virginia Code § 56-6-31 (2012)2 and that he was entitled
to prejudgment interest at a rate of 7% beginning on the date of accrual which the court
determined was August 2, 2010, the date Mr. Ringer filed his counterclaim against Mr. John.
1
This ruling was never appealed.
2
West Virginia Code § 56-6-31(a) states, in pertinent part: “Special damages include
lost wages and income, medical expenses, damages to tangible personal property and similar
out-of-pocket expenditures, as determined by the court.”
2
On July 18, 2011, Mr. Ringer filed a motion to amend the judgment order
contending that the court had erred in determining the date on which prejudgment interest
began to accrue and had utilized an incorrect prejudgment interest rate. Mr. Ringer asserted
that prejudgment interest begins to accrue on the date that a party first has a right to bring suit
and not from the date that suit is actually filed. Mr. Ringer maintained that he had the right
to bring a cause of action against Mr. John for unjust enrichment as of July 19, 2007, the date
he last performed work on Mr. John’s property. Mr. Ringer also argued that the applicable
interest rate should be 9.75%, which was the interest rate for the calendar year of 2007 as
established by this Court.3
3
West Virginia Code § 56-6-31(b) provides, in pertinent part:
The administrative office of the Supreme Court of Appeals shall
annually determine the interest rate to be paid upon judgments
or decrees for the payment of money and shall take appropriate
measures to promptly notify the courts and members of the West
Virginia State Bar of the rate of interest in effect for the
calendar year in question. Once the rate of interest is
established by a judgment or decree as provided in this section,
that established rate shall thereafter remain constant for that
particular judgment or decree, notwithstanding changes in the
Federal Reserve District discount rate in effect in subsequent
years.
3
On August 18, 2011, the circuit court4 entered an order denying Mr. Ringer’s
motion to amend the judgment order.5 This appeal followed.
II. Standard of Review
“The standard of review applicable to an appeal from a motion to alter or
amend a judgment, made pursuant to W. Va. R. Civ. P. 59(e), is the same standard that would
apply to the underlying judgment upon which the motion is based and from which the appeal
to this Court is filed.” Syl. Pt. 1, Wickland v. American Travellers Life Ins. Co., 204 W.Va.
430, 513 S.E.2d 657 (1998). In this case, we are asked to resolve questions of law with
regard to the way that prejudgment interest is calculated. Pursuant to syllabus point one of
Chrystal R.M. v. Charlie A.L., 194 W.Va. 138, 459 S.E.2d 415 (1995), “[w]here the issue
on an appeal from the circuit court is clearly a question of law or involving an interpretation
of a statute, we apply a de novo standard of review.” See also State Farm Mut. Auto Ins. Co.
v. Rutherford, 229 W.Va. 73, 726 S.E.2d 41 (2011) (explaining that determining amount of
prejudgment interest on judgment is question of law requiring de novo review). With this
standard in mind, we consider the issues presented in this case.
4
This case was tried before the Honorable Lawrance S. Miller, Jr., Judge of the Circuit
Court of Preston County, but the post-trial motions were ruled upon by the Honorable Larry
V. Starcher, sitting as a Special Judge in this matter.
5
In the same order, the court denied Mr. John’s Motion for a New Trial and granted,
in part, and denied, in part, Mr. John’s Motion for Stay of Execution/Ruling on Topsoil. Mr.
John did not appeal those rulings.
4
III. Discussion
In this case, we are asked to determine whether the trial court properly awarded
prejudgment interest. The trial court found that Mr. Ringer was entitled to prejudgment
interest on his award of damages for his unjust enrichment claim pursuant to West Virginia
Code § 56-6-31(a), which provides, in pertinent part:
Except where it is otherwise provided by law, every
judgment or decree for the payment of money, whether in an
action sounding in tort, contract or otherwise, entered by any
court of this State shall bear interest from the date thereof,
whether it be so stated in the judgment or decree or not:
Provided, That if the judgment or decree, or any part thereof, is
for special damages, as defined below, or for liquidated
damages, the amount of special or liquidated damages shall bear
interest at the rate in effect for the calendar year in which the
right to bring the same shall have accrued, as determined by the
court and that established rate shall remain constant from that
date until the date of the judgment or decree, notwithstanding
changes in the federal reserve district discount rate in effect in
subsequent years prior to the date of the judgment or decree.
As discussed above, Mr. Ringer asserts that the trial court erred by finding that prejudgement
interest began to accrue on the date he filed his counterclaim against Mr. John and,
consequently, applied an incorrect prejudgment interest rate.
Upon review of the submitted record, we find that the trial court erred by
applying West Virginia Code § 56-6-31 in the first instance. The record reflects that this case
was prosecuted as a breach of contract. While Mr. Ringer’s counterclaim was framed in
terms of unjust enrichment, it is, nonetheless, an action founded on contract. See Realmark
5
Developments, Inc. v. Ranson, 214 W.Va. 161, 164, 588 S.E.2d 150, 153 (2003) (explaining
that unjust enrichment, sometimes referred to as restitution, is a contract implied in law or
a quasi-contract). West Virginia Code § 56-6-27 (2012), rather than West Virginia Code §
56-6-31, provides for prejudgment interest in actions founded on contract. In that regard, this
Court has previously held:
In an action founded on contract, a claimant is entitled to
have the jury instructed that interest may be allowed on the
principal due, W.Va.Code, 56-6-27 [1923], but is not entitled to
the mandatory award of interest contemplated by W.Va.Code,
56-6-31 [1981], since this statute does not apply where the rule
concerning interest is otherwise provided by law.
Syl. Pt. 4, Thompson v. Stuckey, 171 W.Va. 483, 300 S.E.2d 295 (1983). West Virginia Code
§ 56-6-27 states:
The jury, in any action founded on contract, may allow
interest on the principal due, or any part thereof, and in all cases
they shall find the aggregate of principal and interest due at the
time of the trial, after allowing all proper credits, payments and
sets-off; and judgment shall be entered for such aggregate with
interest from the date of the verdict.
In Stuckey, the plaintiff was hired by a landowner to prepare a plot of land as
a mine site. The plaintiff undertook the work on the basis of an oral promise from the land
owner to pay him $1200 per month plus a bonus of ten cents per ton of coal mined once the
mine became operational. In the event the mine was sold, the landowner promised that the
plaintiff would receive a minimum of $100,000. The plaintiff was paid regularly for his
work at the monthly rate, but the mine was sold before production started. When the plaintiff
6
did not receive his $100,000 bonus, he filed suit against the landowner. The plaintiff was
successful at trial and the defendant landowner filed an appeal. The plaintiff cross-assigned
as error the trial court’s refusal to instruct the jury that it could award prejudgment interest.
In finding that the trial court had erred in that regard, this Court explained:
W.Va.Code, 56-6-27 [1923] provides that “[t]he jury, in any
action founded on contract, may allow interest on the principal
due. . .”, and W.Va.Code, 56-6-31 [1981] provides that “[e]xcept
where it is otherwise provided by law, every judgment or decree
for payment of money entered by any court of this State shall
bear interest from the date thereof. . . : Provided, that if the
judgment or decree, or any part thereof, is for special or
liquidated damages, the amount of such liquidated changes shall
bear interest from the date the right to bring the same shall have
accrued. . . .” Since this action was “founded on contract,” we
consider Code, 56-6-27 [1923] to apply to the matter of
prejudgment interest, and not Code, 56-6-31 [1981], which by
its own terms only applies where the rule concerning interest is
not otherwise provided by law.6
171 W.Va. at 488, 300 S.E.2d at 300 (footnote added); see also CMC Enterprise, Inc. v. Ken
Lowe Mgmt. Co., 206 W.Va. 414, 418, 525 S.E.2d 295, 299 (1999) (explaining that West
Virginia Code § 56-6-27 is the general authority for awarding prejudgment interest in
contract actions); City Nat’l Bank of Charleston v. Wells, 181 W.Va. 763, 778, 384 S.E.2d
6When this Court decided Stuckey, West Virginia Code § 56-6-31 did not include the
language “whether in an action sounding in tort, contract or otherwise.” This language was
added when the statute was amended in 2006. Despite the insertion of this language, the
phrase “[e]xcept where it is otherwise provided by law” was retained. Accordingly, we do
not find that this statutory amendment provides any basis to revisit our holding in Stuckey.
7
374, 389 (1989) (observing that W.Va.Code 56-6-31 does not specifically apply to contract
actions).
Having found that the trial court erred by awarding Mr. Ringer prejudgment
interest pursuant to West Virginia Code § 56-6-31, instead of allowing the jury to determine
whether an award of prejudgment interest was warranted as provided by West Virginia Code
§ 56-6-27, we reverse the final order of the circuit court to the extent it denied Mr. Ringer’s
motion to amend the judgment order. We further remand this case for reconsideration of the
amount of prejudgment interest owed to Mr. Ringer in accordance with West Virginia Code
§ 56-6-27.7
IV. Conclusion
For the reasons set forth above, the final order of the Circuit Court of Preston
County entered on August 18, 2011, is reversed insofar as it denied Mr. Ringer’s motion to
amend the judgment order, and this case is remanded to the circuit court for further
proceedings consistent with this opinion.
Reversed and remanded.
7
Because we have determined that West Virginia Code § 56-6-27 applies to this case,
it is unnecessary to address Mr. Ringer’s second assignment of error, which related to the
interest rate applicable to prejudgment interest awarded pursuant West Virginia Code § 56-6­
31.
8