Free Motion to Amend/Correct - District Court of Delaware - Delaware

Case 1:04-cv-00163-GMS

Document 305

Filed 10/25/2006

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE
DONALD M. DURKIN CONTRACTING
INC. Plaintiff
vs.

CITY OF NEWARK , et aI. Defendants
and

: CASE NO. 04- 0163-GMS

CITY OF NEWARK Third-Party
vs.

Plaintiff

DONALD M. DURKIN CONTRACTING FEDERAL INSURANCE COMPANY and URS CORPORATION Third-Party Defendants

ST. PAUL FIRE & MARINE INSURANCE
COMP ANY
Intervenor

PLAINTIFF' S MOTION TO AMEND JUDGMENT TO ADD INTEREST PURUSANT TO FEDERAL RULE OF CIVIL PROCEDURE 59(e)
POWELL, TRACHTMAN, LOGAN, CARRE & LOMBARDO, P. Paul A. Logan Delaware Supreme Court ID #3339 475 Allendale Road , Suite 200 King of Prussia , P A 19406
Telephone: 610- 354- 9700

Telefacsimile: 610- 354- 9760
Attorneys for Plaintif and Third Party

Defendant Donald M Durkin Contracting
Dated: October 25

2006

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The jury returned a verdict for Plaintiff and Third Pary Defendant Donald M.
Durkin Contracting, Inc. (" Durkin
(collectively the " City

) against

Defendant City of Newark and Councilpersons

) on October 5 , 2006.
11

The Court entered judgment for Durkin based upon the verdict on October
2006. Durkin fies this Motion pursuant to Rule 59( e) to amend the judgment to add interest.
Under Delaware law ,

Durkin is entitled as a matter of right to: (1) pre-judgment

interest on the pay applications submitted by Durkin , but not paid by the City and (2) unpaid cost
of work due to Durkin as of the date of

termination.

Chrysler Corporation

v.

Chaplake

Holdings, Ltd., et al. 822 A. 2d 1024 2003 Del. LEXIS 269 (Del. Sup. Ct. 2003).
Durkin is also entitled to pre-judgment interest on the civil rights award.

See e.

Springer

v.

Henry, et. ai 2004 WL 2127172 (D. Del. Sept. 16 , 2004) (Appendix (" App. ) Al-

A16).

Further , Durkin
judgment amount ,

is entitled to receIve post-judgment interest on the

entire

which includes compensatory damages for work performed (Jury Verdict

Form LA.l), post termination expenses (Jury Verdict Form LA. 2) and damages for civil rights
violation (Jury Verdict Form LB). (App. A17- A24).
See

28 US.

S.

1961.

The jury awarded Durkin monies it biled the City in payment applications Nos.
, 19

21 and 23

included as part of the compensatory damages awarded. (Trial Exhibit

DUR- 9) (Jury Verdict Form LA.!) (App. A17- A24).

Durkin is entitled to receive interest on each of these payment applications as
provided for in the contract between the City and Durkin. (Trial Exhibit DURno. CC- 1232). (App. A25).

, Art. 6 , Bates

I Payment Application No. 22 was a credit of ($47 912. 90) due to the City. (Trial Exhibit DUR- 9).
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The jury awarded Durkin $5

492 666. 55 for compensatory damages for unpaid

cost of work as ofthe date of termination. (Jury Verdict Form LA 1 and Trial Exhibit DUR- 68).
(App. A17- A24).

Durkin is entitled to receive pre-judgment interest on this amount pursuant to 6

Del. C. ~2301 from the date of termination - Februar
entered - October 11 ,

3,

2004

- until the date

judgment was

2006. (D. L 298).

10.

The jury awarded Durkin $25, 000 000. 00 for civil rights violations. (Jury Verdict

Form LB. App. A17- A24).
11.

Durkin is entitled to pre-judgment interest on the violation of civil rights award

from the date oftermination - February 3 2004 - until the date judgment was entered - October
, 2006. (D. L 298).
12.

Durkin is also entitled to post-judgment interest on the entire jury verdict award
Under 28 U.
C. ~1961 ,

of $36 667 573. 33.

Durkin is entitled to receive interest from the date

of judgment - October 11 , 2006 - until the judgment is paid in full.
13.

Rule 59( e)

permits a pary to fie a

Motion to amend the judgment if the Motion is

fied no later than ten (10) days after entry of the judgment.
14.

Federal courts have noted that motions under Rule 59(e) are permitted to amend
pre-judgment and post-judgment interest.
Company,

judgments to add

See e. g. McCalla

v.

Royal
Cir.

MacCabees Life Insurance

269 F. 3d 1128 , 2004 U.S. App. LEXIS 10796 (9

2004) (and cases cited therein).
2 The $5 492 666. 55 award for compensatory damages includes $275 837. 79 for the amount of unpaid Payment Applications , which is entitled to interest as provided under the Contract. (Trial Exhibit DUR, Art. 6 , Bates no. CC- 1232). Accordingly, the amount of compensatory damages that is entitled to 2301 is $5 216 828. 76 ($5 492 666. 55 - $275 837. 79). interest pursuant to 6 Del. C. 3 Council voted to terminate Durkin immediately on February 2 , 2004 (Trial Exhibit DUR- 6) and notified See Complaint 127 App. A26Durkin of the termination by correspondence dated February 3 2004. A69. -2KOP:353006vI3514-

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15.

Delaware law recognizes the right to collect pre-judgment interest on a debt.

See

g., Chrysler Corporation

v.

Chaplake Holdings, Ltd., et al.

822 A 2d 1024 , 2003 Del. LEXIS

269 (Del. Sup. Ct. 2003).
16.
Moskowitz v.

Pre-judgment interest is awarded as a matter of right ,

not by judicial discretion.

Mayor and Council of Wilmington 391 A2d 209 1978 Del. LEXIS 784 (Del. Sup.

Ct. 1978).

17.

Delaware federal courts have applied Delaware
interest.

law

recognizing the right to
v.

collect pre-judgment
Construction Company, et a!.,

See,

g. United

States of America et a!.

Star Bright

848 F. Supp. 1161 ,

1994 U. S. Dist. LEXIS 4240 (D. Del. 1994).

18.

When the contract does not specify an interest rate , 6 Del. Code ~2301(a) states

the legal rate of interest shall be 5% over the Federal Reserve discount rate including any
surcharge as of the time from which interest is due. "
19.
6 Del.

Code ~2301(a).

The contract between Durkin and the City provides that " (a)ll monies not paid

when due as provided in Article 14 of the General Conditions shall bear interest at a rate of five

percent per anum.
20.

(See

Contract at Trial Exhibit DUR-

, Article 6 , App. A25.

Article 14 of the General Conditions sets forth the process for payment

applications to be submitted by Durkin , reviewed by the Engineer (URS Corporation) and paid
by the City. (Contract ,

Article 14 , App. A70- A74.
within ten (10) days

21.

Under the contract ,

after Durkin submits

a payment

application , the Engineer wil either recommend the payment application to the City for payment

or return it to Durkin with written reasons for the refusal. (Contract , Article 14 , Section 14.4
App. A70- A74. )
If the

Engineer approves the payment application for payment , it is presented to

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the City.

Id.

Payment is due to Durkin ten (10) days after the Engineer presents the payment
Id.
19

application to the City for payment.

22.

Payment applications Nos. 18 ,
See

20 and 21 were approved for payment by the

Engineer on December 29 , 2003.

Trial Exhibit DUR- , Engineer s Certificate for Payment.

23.

The aggregate amount of these payment applications was $210 834. 62. Payment
Article 14 ,

was then due from the City on January 8 , 2004. (Contract
A74.
24.

Section 14.4 , App. A70-

Durkin is entitled to pre-judgment interest on these monies at a rate of 5% per
January 8 ,

anum from

2004 until October

11 ,

2006 - the date

of Judgment - for

payment

applications Nos. 18 , 19 20 and 21.
25.

The total pre-judgment interest due for payment applications Nos. 18 ,

19

, 20 and

21 is $29 083. 62.
26.

Payment application No. 23 was approved
See

for payment by the Engineer on

January 22 , 2004.

Trial Exhibit DUR- , Engineer s certification for payment.

27. 28.
Section 14.4 ,

The total amount of payment application No. 23 was $65 003. 17.

Payment was then due from the City on February 1 , 2004. (Contract , Article 14
App. A70- A74.

29.
February 1

Consequently, Durkin is entitled to pre-judgment interest at a 5% per annum from
, 2004 until October 11 , 2006 for Application No. 23 , yielding the total pre-judgment

interest due for payment application No. 23 is $8 753. 17.

4 The calculation is as follows: 5% per annum interest on $210 834. 62 from 1/8/04 to 1/8/05 = $10, 541.73 + 5% per annum interest 1/8/05 to 1/8/06 = $10 541.73 + 5% per annum interest 1/8/06 to 10/11/06 = $8 000.16. $10 541.73 + $10 541.73 + $8 000. 16 = $29 083. 62.

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30.

In summary,

the total amount
$37. 836.

of

pre-judgment interest due on payment

applications nos. 18 ,

19

21 & 23 is

31.

The jury awarded Durkin $5,492 666. 55 as the unpaid cost of work performed as

of the date of termination. (Jury Verdict Form LA 1 and Trial Exhibit DUR- 68).
32.
and 23 ($275

Since this amount includes the amounts in payment application nos. 18 , 19, 20 , 21
837. 79), which pre-judgment interest was already computed per the terms of the

contract ,

and the contract does not provide for

any pre-judgment rate of interes e
of $5

Durkin

entitled to statutory

pre-judgment interest on the balance

216 828. 76

($5

492 666. 55 -

$275 837. 79) pursuant to 6 Del. Code ~2301(a), which indicates that the rate shall be 5% over

the Federal Reserve discount rate including any surcharge as of the time from which interest is
due.
33.

The unpaid cost of the work was due to be paid to Durkin as of the date of
2004. See

termination - February 3 ,

Trial Exhibit No. DUR- 6 and Complaint

127 App. A50.

34.
was 2. 5%.

The Federal Reserve discount rate including any surcharge as of February 3 , 2004

35.

Under 6 Del. Code ~2301(a), the appropriate interest rate for the unpaid cost

work in the amount of$5 216 828. 76 is 7. 5% per annum (2. 5% + 5%).

5 The calculation is as follows: 5% per annum interest on $65 003. 17 from 2/1/04 to 2/1/05 = $3 250. 16 + 5% per annum interest 2/1/05 to 2/1/06 = $3 250. 16 + 5% per annum interest 2/1/06 to 10/11/06 = 252. 85. $3 250. 16 + $3 250. 16 + $2 252. 85= $8 753. 17. 6 The calculation is as follows: $29 083. 62 + $8 753. 17 = $37 836. 79. 7 Article 6 of the Contract provides for interest on " all monies not paid when due as provided in Article 14 of the General Conditions... , which relates only to progress payments on approved applications for

payment. Excepting

payment applications 18 , 19 , 20 , 21 & 23 , the amounts for compensatory damages awarded by the jury were not derived from Article 14 pay applications , but from
the amounts in

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36.

Thus , the

total pre-judgment

interest for the unpaid cost of work

$1.050. 512.1 0
37.
The jury awarded Durkin $25 000 000. 00 for damages due

to civil rights

violations. Durkin is entitled to collect pre-judgment interest on this damage award.
38.

Most federal courts that addressed the issue of awarding pre-judgment interest in
Golden State

Section 1983 cases have concluded that pre-judgment interest should be awarded.

Transit Corp.

v.

Los Angeles 773 F. Supp. 204

1991 U. S.

Dist. LEXIS 11798 (C. D.

CaI. 1991)

(internal citations omitted).
39.

Durkin suggests that this Court utilize 28 U.S. C. ~ 1961 to determine the proper

amount pre-judgment interest that should be awarded.
40.

This would be consistent

with this Court' s prior determination of the proper

amount of pre-judgment interest to award in a Section 1983 case.

Springer

v.

Henry, et. ai, 2004

WL 2127172 (D. Del. Sept. 16 2004) (App. A1- A16).
41.

Accordingly, Durkin is entitled to pre-judgment interest calculated " at a rate equal

to the weekly average I- year constant maturity Treasury yield , as published by the Board of
Governors of the Federal Reserve System. "
42. 43.
The interest shall be compounded annually.

28 U.

C. ~1961(a).

See

28 U.

C. ~1961(b).

The total pre-judgment interest for the $25 000 000. 00 award is

$2.370.491.33

8 The calculation is as follows: 7. 5% interest on $5 216 828. 76

from 2/3/04 to 2/3/05 = $391

262. 16 +

7.5% interest from 2/3/05
$267 987. 78.
9 Refer to

to 2/3/06 = $391

262.16 + 7. 5% interest from 2/3/06

to 10/11/06 =

262. 16 + $391 262. 16 + $267 987. 78 = $1 050 512. 10. http://ww . frbdiscountwindow . org/historicalrates. cfm?hdrID=20&dtlID=5 2
$391

10

The calculation is as follows: Annual date week ending 2/6/04 to 1/28/05 average interest is 2. 0194% *
$504, 855. . Annual date week ending 2/4/05 to 1/27/06 average interest is $955.205. . Annual date week ending 855. 77 principal and compounded interest = 7452% * $25 504
000 principal =

$25 000

2/3/06 to 10/6/06 average interest is 4. 9700%

* $26,460 061.67 principal and compounded interest =

910.429. 66. Total pre-judgment interest on civil rights award = $504 855. 77 + $955 205. 90 + $910 429. 66 = $2,370.491.33

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44.

A pary is entitled to recover interest on any money judgment in a civil case
See

recovered in a district court.

28 U.

C. ~1961.

45.

The interest is to be " calculated from the date of the entry of the judgment , at a

rate equal to the weekly average I- year constant maturity Treasury yield , as published by the
Board of Governors of the Federal Reserve System , for the calendar week preceding the date of
the judgment." 28 U.
46.
C. ~1961(a).

The post-judgment interest shall also be compounded anually.

See

28 U.S.

~1961(b).
47.

Judgment was entered for Durkin in the amount of$36 667 573. 33

on October 11

2006. (D. L 298).

48. 49.
50.

Accordingly, the appropriate interest rate under 28 U.S. C. ~ 1961 is 4. 90%.

The daily interest for the post-judgment interest award is $4 922. 50

per day.

The yearly interest for the post-judgment interest award is $1 796 711.09, which

is compounded annually

WHEREFORE , for the

reasons set forth above , Defendant Donald M.

Durkin

Contracting, Inc. respectfully requests that this Court grant its Motion to Amend the Judgment to

Add Interest Pursuant to Federal

Rule of

Civil Procedure Rule 59(e) in the amount
interest up to

527, 755.21 which includes pre-judgment interest and post-judgment

and

including October 25 , 2006 (which is the date of the filing of this Motion).
Judgment should be amended to reflect a Judgment of

!3 Accordingly, the
Plaintiff Donald M.

$40, 195, 328. 54.

http://ww. frbdiscountwindow. org/historicalrates.cfm?hdrID=20&dtIID=52 Durkin reserves the right to supplement the post-judgment interest calculation at the time of payment of the judgment by the City. 13 The calculation is as follows: $37 836. 79 (pre-judgment interest on Pay Applications) + $1 050 512. (pre-judgment interest on compensatory damages for unpaid cost of work) + $2 370 491.33 (pre-judgment
II Refer to

12

interest on civil rights damages)
interest of $4 922. 50)
= $3

+ $68

915 (14 days (10/11/06
-7-

to 10/25/06) of post-judgment daily

527 755. 21.

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Durkin Contracting, Inc. respectfully requests leave to re- fie

a supplemental

Motion to calculate

the entire post-judgment interest at the time of payment of the judgment by the City.
POWELL, CARRE &

TRACHTMAN, LOGAN,
LOMBARDO,

Paul A. Logan Paul A. Logan Delaware Supreme Court ID #3339 475 Allendale Road , Suite 200 King of Prussia , P A 19406 (T) 610- 354- 9700; (F) 610- 354- 9760
By: Isl

Attorneys for

Plaintif

Dated: October 25, 2006

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