Summary
holding that "imposition of statutory interest pursuant to [Mich. Comp. Laws §] 600.6013 is mandatory and interest must be paid from the date the complaint was filed."
Summary of this case from Mike Vaughn Custom Sports, Inc. v. PikuOpinion
Docket No. 177573.
Submitted June 11, 1996, at Detroit.
Decided August 20, 1996, at 9:05 A.M. Leave to appeal sought.
Bendure Thomas (by Mark R. Bendure), for the plaintiffs.
Kohl, Secrest, Wardle, Lynch, Clark and Hampton (by William P. Hampton and Lanie Anderson), for the defendants.
After the Supreme Court remanded Hadfield v Oakland Co Drain Comm'r, 430 Mich. 139; 442 N.W.2d 205 (1988), for further findings of fact and damages, the Oakland Circuit Court on July 3, 1989, awarded plaintiffs damages of $34,982.82. On July 19, 1989, an amended opinion and order was entered awarding statutory interest on the $34,982.82 at six percent per annum from January 7, 1977, the date of the filing of the complaint, to June 1, 1980, and twelve percent interest from June 1, 1980, to the date of satisfaction. MCL 600.6013; MSA 27A.6013.
On September 11, 1989, a stipulated order was entered for the payment of the judgment and current interest into court pursuant to MCR 8.106 and MCL 600.576; MSA 27A.576. A partial satisfaction was given by plaintiffs on September 12, 1989, in the amount of $128,448.17 representing the amount of the amended and final judgment of July 19, 1989, with interest up through August 9, 1989. Plaintiffs moved for disbursement of these funds, and, on September 29, 1989, the court ordered the funds released to plaintiffs.
On December 16, 1989, plaintiffs appealed, by leave granted on July 16, 1990, the trial court's order of July 19, 1989. Defendants did not cross appeal. On April 12, 1993, this Court held that the trial court's findings of fact with respect to the amount of damages were clearly erroneous and that the drain commissioner was liable in the amount of $162,254.10 plus interest. Hadfield v Oakland Co Drain Comm'r, unpublished opinion per curiam of the Court of Appeals, issued April 12, 1993 (Docket No. 124295). Defendants' motion for rehearing was denied by this Court on July 16, 1993.
Defendants filed a motion for postjudgment relief with the trial court on June 15, 1994. The trial court held that statutory interest on the added damages of $127,271.28 resulting from this Court's amended award would accrue from the date of this Court's opinion, April 12, 1993, and not from January 7, 1977, the date of the filing of the complaint. On July 27, 1994, the trial court entered an order granting defendants postjudgment relief and requiring defendants to pay into the court $147,776.39 (the added damage of $127,271.28 plus $29,505.11 in postjudgment interest). Plaintiffs appealed the trial court's July 27, 1994, order as of right on August 4, 1994. Plaintiffs filed a motion for an order for release of the funds held by the circuit court ($147,776.39), which was denied by the trial court. The order denying this motion also provided that the funds were not to be released while plaintiffs' appeal was pending.
Following the order of remand by the Supreme Court, the trial court awarded plaintiffs $34,982.82 damages with interest from the filing of the complaint. Plaintiffs appealed, and this Court amended the award to $162,254.10 plus interest, increasing the damages by $127,271.28 over those found by the trial court. When the trial court regained jurisdiction, it granted defendants' motion for postjudgment relief, stripping plaintiffs of prejudgment interest with respect to this Court's increase in damages of $127,271.28 resulting from this Court's amended award. Defendants did not appeal the trial court's judgment finding plaintiffs entitled to prejudgment interest.
Plaintiffs claim that the trial court did not have authority to deny prejudgment interest with respect to the increase in damages of $127,271.28 when defendants failed to appeal the trial court's previous order entitling plaintiffs to prejudgment interest. We agree.
The trial court's decision on the motion for postjudgment relief is reviewed for an abuse of discretion. Haberkorn v Chrysler Corp, 210 Mich. App. 354, 382; 533 N.W.2d 373 (1995). In civil cases, an abuse of discretion exists when the decision is so violative of fact and logic that it evidences a defiance of judgment and is not the exercise of reason, but rather, of passion or bias. Dacon v Transue, 441 Mich. 315, 329; 490 N.W.2d 369 (1992).
When a matter is remanded to the trial court by an appellate court, the trial court possesses the authority to take action that is consistent with the appellate court's opinion and order. VanderWall v Midkiff, 186 Mich. App. 191, 196; 463 N.W.2d 219 (1990). Res judicata precludes the trial court from considering issues not considered by the appellate court during a prior appeal, if the issues could have been raised on the prior appeal. Id. at 196-197. A trial court cannot do on remand what higher courts could not do on appeal. Id.
On the basis of VanderWall, supra, the trial court's July 19, 1989, judgment had res judicata effect on all subsequent proceedings in the trial court because defendants failed to appeal that determination. Defendants were bound on that issue. Accordingly, the trial court abused its discretion in holding that plaintiffs were not entitled to prejudgment interest with respect to the increased damages of $127,271.28.
Defendants' argument that the trial court had authority to grant postjudgment relief pursuant to MCR 2.612(C)(1)(e) is unpersuasive, because defendants could have raised the issue of the satisfaction of judgment in the original appeal, but did not, and, thus, were precluded from seeking relief under MCR 2.612. VanderWall, supra.
The trial court was prevented by the doctrine of law of the case from ruling that plaintiffs were not entitled to prejudgment interest with respect to the $127,271.28 added by this Court's amended award. If a party disagrees with this Court's ruling on appeal it should seek rehearing or leave to appeal to the Supreme Court and not challenge this Court's determination in the trial court. Bennett v Bennett, 197 Mich. App. 497, 503; 496 N.W.2d 353 (1992); Freeman v DEC Int'l, Inc, 212 Mich. App. 34, 37; 536 N.W.2d 815 (1995). In its April 12, 1993, opinion, this Court amended the trial court's judgment to reflect an award of $162,254.10 plus interest. Because this Court ruled on the prejudgment interest issue, the trial court was precluded from altering that ruling. The satisfaction of September 12, 1989, by its own terms, was a "partial" satisfaction. MCL 600.6013; MSA 27A.6013 establishes the tolling of interest only on a full satisfaction.
MCL 600.6013(2); MSA 27A.6013(2) specifically states that interest accrues on money judgments from the time the complaint was filed:
For complaints filed before June 1, 1980, in an action involving other than a written instrument having a rate of interest exceeding 6% per year, the interest on judgment shall be calculated from the date of filing the complaint to June 1, 1980, at the rate of 6% per year and on and after June 1, 1980, to the date of satisfaction of the judgment at the rate of 12% per year compounded annually. [Emphasis supplied.]
The purpose of this provision is to compensate prevailing parties for expenses incurred in bringing suits for money damages and for any delay in receiving such damages. Coughlin v Dean, 174 Mich. App. 346, 352; 435 N.W.2d 792 (1989). The provision is remedial in nature and is to be construed liberally in favor of the plaintiff. Southfield Western, Inc v Southfield, 206 Mich. App. 334, 339; 520 N.W.2d 721 (1994). The use of the word "shall" in a statute connotes mandatory duty or requirement. Heyler v Dixon, 160 Mich. App. 130, 152; 408 N.W.2d 121 (1987). Therefore, imposition of statutory interest pursuant to MCL 600.6013; MSA 27A.6013 is mandatory and interest must be paid from the date the complaint was filed. Id. This Court has held that trial courts must accrue interest from that time. Dep't of Treasury v Central Wayne Co Sanitation Authority, 186 Mich. App. 58, 64; 463 N.W.2d 120 (1990); Goins v Ford Motor Co, 131 Mich. App. 185, 201-202; 347 N.W.2d 184 (1983).
Statutory interest accrues until the judgment is satisfied. MCL 600.6013(2); MSA 27A.6013(2). MCR 2.620 sets forth the manner in which a judgment debtor can satisfy a judgment. Subsection 2 of that court rule specifically provides that a money judgment may be satisfied by "payment to the clerk of the judgment, interest, and costs." However, payment to the clerk stops the accrual of interest only with respect to the portion paid, not the entire amount later determined to be due. Kleynenberg v Highlands Realty Corp, 340 Mich. 339, 343; 65 N.W.2d 769 (1954); Niggeling v Dep't of Transportation, 195 Mich. App. 163, 166; 488 N.W.2d 791 (1992).
The July 27, 1994, order of the Oakland Circuit Court is reversed. We remand to the trial court to recompute the interest. Pursuant to this Court's April 12, 1993, opinion, plaintiffs are entitled to $127,271.28 plus interest from January 7, 1977, the date the complaint was filed, until that judgment is satisfied. On the basis of MCL 600.6013(2); MSA 27A.6013(2), interest should "be calculated from the date of filing the complaint to June 1, 1980, at the rate of 6% per year and on and after June 1, 1980, to the date of satisfaction of the judgment at the rate of 12% per year compounded annually." However, because defendants deposited $147,776.39 with the court on July 27, 1994, which represented the court's additur of $127,271.28 plus $20,505.11 in postjudgment interest, the court should determine what the principal and interest owed would have been on July 27, 1994, and subtract from that amount $147,776.39. See Niggeling, supra at 166. Interest on the remaining amount owed from July 27, 1994, should be calculated at the rate of twelve percent a year compounded annually until it is fully paid.
Reversed and remanded.