Judge: Anne Richardson, Case: 19STCV46651, Date: 2023-09-26 Tentative Ruling

Case Number: 19STCV46651    Hearing Date: September 26, 2023    Dept: 40

Superior Court of California

County of Los Angeles

Department 40

Background

Plaintiff Chia Ying Lin sued Defendants Keny Chang, Golden Foundation Realty, Inc., Kingstone Capital Properties, Inc., and Does 1-100 pursuant to a December 27, 2019 Complaint alleging claims of (1) Breach of Written Contract, (2) Intentional Misrepresentation, and (3) Negligent Misrepresentation.

In turn, Defendant Keny Chang sued Plaintiff Chia Ying Lin and Roes 1 through 20 pursuant to a July 20, 2020 Cross-Complaint alleging claims of (1) Breach of Written Contract, (2) Breach of Fiduciary Duties, (3) Intentional Misrepresentation, and (4) Accounting.

On August 25, 2023, the Court held a non-jury trial in this action. At the conclusion of trial, the Court “grant[ed] judgment in favor of Kingston Capital Properties, Inc.” and granted “[j]udgment … in favor of Plaintiff … against … Defendant [Keny Chang].” The Court also set an OSC re Entry of Judgment for September 20, 2023.

On August 30, 2023, Plaintiff filed a joint stipulation by the parties to continue the OSC re Entry of Judgment to September 26, 2023.

Later that same day, Plaintiff moved for an award of prejudgment interest in this action. The motion was set for hearing on September 26, 2023.

On September 1, 2023, Plaintiff filed a memorandum of costs.

On September 13, 2023, Defendant Chang opposed the motion for an award of prejudgment interest.

On September 18, 2023, Plaintiff replied to the opposition.

Plaintiff’s motion for an award of prejudgment interest is now before the Court.

Motion for Prejudgment Interest

Legal Standard

Prejudgment interest compensates a plaintiff for the loss of the use of property or money during the period before a judgment is entered. (Segura v. McBride (1992) 5 Cal.App.4th 1028, 1041.) “It is commonly recognized that prejudgment interest represents the accretion of wealth that particular property could have produced during a period of loss.” (Newby v. Vroman (1992) 11 Cal.App.4th 283, 289.) As such, “[it] is well established that prejudgment interest is not a cost, but an element of damages.” (North Oakland Medical Clinic v. Rogers (1998) 65 Cal.App.4th 824, 830.) Prejudgment interest may be awarded even if it is not specifically authorized by the statute underlying the claims. (County of Solano v. Lionsgate Corp. (2005) 126 Cal.App.4th 741, 752.)

An award of prejudgment interest may be made where the claim is liquidated within the meaning of the statute, i.e., when the underlying damages are “certain” or “capable of being made certain by calculation” and the right to recover such damages is vested in the plaintiff on a particular day. (Civ. Code § 3287, subd. (a); Duale v. Mercedes-Benz USA, LLC (2007) 148 Cal.App.4th 718, 728, citing Fireman’s Fund Ins. Co. v. Allstate Ins. Co. (1991) 234 Cal.App.3d 1154, 1172.) A right to recover damages becomes vested at the time the damages at issue are sustained. (See, e.g., Williams v. Graham (1948) 83 Cal.App.2d 649, 653 [Where purchaser relying on fraudulent representations of vendor’s ability to convey, incurred rental liability for six months and made down payment upon the property, the right to recoup became vested on the day on which each separate amount was expended].)

“Interest is recoverable from ‘the time of breach where the amount of money due is liquidated, or from the time it becomes liquidated.’ [Citation.]” (Moreno v. Jessup Buena Vista Dairy (1976) 50 Cal.App.3d 438; accord. Maurice L. Bein, Inc. v. Housing Authority of City of Los Angeles (1958) 157 Cal.App.2d 670, 686 [Interest commences on the first day there exists both a breach and a liquidated claim].)

An award of prejudgment interest may also be made as to unliquidated amounts after judgment, beginning on a date prior to judgment, provided that such awards are discretionary and, in deciding whether to exercise its discretion, the court “consider[s] the circumstances, realizing a party cannot pay the amount due until it is determined what that amount was.” (Civ. Code § 3287, subd. (b); Union Pacific Railroad Company v. Santa Fe Pacific Pipelines, Inc. (2014) 231 Cal.App.4th 134, 203 [quoted language].)

In absence of a contractual rate of interest, the rate of prejudgment interest is 10% per annum. (Civ. Code §3289, subd. (b).)

Order Granting Award of Prejudgment Interest: GRANTED, in Part.

Plaintiff Lin brings this motion “seeking an award of prejudgment interest in her favor at the rate of ten percent (10%) per annum on the verdict of $76,323.66 from the date of the breach on October 31, 2017 through September 26, 2023.” (Mot., Notice, p. 2.) Plaintiff argues that at trial, the Court determined that the breach here occurred on October 31, 2017, and that using an interest rate of 10% per annum for breach of contract and a judgment of $76,323.66 in favor of Plaintiff, Plaintiff is entitled to $20.91 in interest per day, which, between October 31, 2017 and September 26, 2023 (the date of this motion) amounts to $45,102.87. (Mot., pp. 3-4; see 8/25/23 Minutes, pp. 2-3 [“Court awards $76,323.66 [to] plaintiff for breach of contract against defendant” Chang and “finds the date of the breach of cont[r]act [w]as October 31, 2017”].)

In opposition, Defendant Chang argues two points. First, Chang argues that interest should be awarded pursuant to Code of Civil Procedure section 685.020 and that such an award, per that statute, can only accrue until after a judgment. Second, Chang argues that Plaintiff should not be entitled to almost six years of prejudgment interest because this matter would have proceeded to trial on June 10, 2022 but was continued because Plaintiff’s counsel appeared at trial without Plaintiff, after which a change of judicial officer in Department 40 caused a further continuance. (Opp’n, pp. 1-2.)

In reply, Plaintiff Lin argues that section 685.020 does not apply to prejudgment interest and that Plaintiff did not intentionally cause trial delays because trials are usually continued in litigation and because, among other things, on June 10, 2022, Defendant Chang did not object to a continuance of trial. (Reply, pp. 3-4.)

The Court finds in favor of Plaintiff Lin.

The Court first notes that, as argued by Plaintiff Lin, Code of Civil Procedure section 685.020 does not apply to prejudgment interest. (Code Civ. Proc., § 685.110 [“Nothing in this chapter [i.e., Code Civ. Proc., §§ 685.010-685.110] affects the law relating to prejudgment interest”].) Instead, the statutory section cited by Defendant Chang applies to postjudgment interest on a judgment. (Code Civ. Proc., § 685.020, subd. (a) [Except as provided in subdivision (b) [relating to a money judgment payable in installments], interest commences to accrue on a money judgment on the date of entry of the judgment].) Prejudgment interest necessarily involves something different: interest that accrues prior to the entry of judgment, not after.

The Court next determines that Plaintiff is properly entitled to prejudgment interest for dates between October 31, 2017 and the date of this hearing because such a claim is liquidated within the meaning of the statute. Plaintiff Lin secured a non-jury trial award of $76.323.66, a sum certain. (8/25/23 Minutes, p. 2 [“Court awards $76,323.66 [to] plaintiff for breach of contract against defendant”].) Moreover, Plaintiff Lin’s right to recover such damages vested on October 31, 2017, the date of the breach involving failure to pay 50% of the liabilities agreed upon by these parties. (8/25/23 Minutes, p. 3 [“Court finds the date of the breach of cont[r]act [w]as October 31, 2017”].)

The Court also determines that the delays in trial in this action do not constitute grounds to reduce any prejudgment interest award. Defendant Chang cites no controlling or persuasive authority to support his argument. (See Opp’n, p. 3.) Moreover, even if such authority exists, the Court finds that the circumstances described by Defendant Chang do not exceed the reasonable bounds of litigation—that is, trials being continued and changes in the judicial officer constitute regular occurrences in litigation—such that Defendant Chang’s argument lacks merit.

The Court last determines that the proper computation of the interest is $76,323.66, times 10% percent per annum, yielding an interest of $7,632.366 per annum, or, by dividing by 365 days per year, $20.91 per day, which is then multiplied by the number of days between October 31, 2017 and the date of this hearing (September 26, 2023) for a total of 2,156 days not including the final day, yielding $45,083.24 in owed prejudgment interest. The interest rate of 10% per annum is applied based on Civil Code section 3289, subdivision (b), and based on a lack of evidence before the Court that Plaintiff Lin and Defendant Chang agreed to a different interest rate.

Plaintiff Lin’s motion is thus GRANTED, in Part, in the amount of $45,083.24. 

Conclusion

Plaintiff Chia Ying Lin’s Motion for Award of Prejudgment Interest is GRANTED, in Part.

Defendant Keny Chang is ORDERED to remit payment of $45,083.24 to Plaintiff Chia Ying Lin within 90 days of this ruling.