Judge Salvatore Sirna, Case Number: 23PSCV02523, Date: 2025-05-01 Tentative Ruling

Judge: Salvatore Sirna, Case: 23PSCV02523, Date: 2025-05-01 Tentative Ruling

Case Number: 23PSCV02523 Hearing Date: May 1, 2025 Dept: G

Plaintiff Veronica Guadalupe Flores’ Motion for Prejudgment Interest

Respondent: Defendants FCA US, LLC

TENTATIVE RULING

Plaintiff Veronica Guadalupe Flores’ Motion for Prejudgment Interest is DENIED.

BACKGROUND

This is a Song-Beverly action. On August 18, 2023, plaintiff Veronica Guadalupe Flores (Plaintiff) filed a complaint against defendants FCA US, LLC (FCA), West Covina CDJR, and Does 1 through 50, alleging causes of action for (1) breach of express warranty obligations under the Song-Beverly Consumer Warranty Act and (2) breach of implied warranty obligations under the Song-Beverly Consumer Warranty Act. Plaintiff brought this complaint after purchasing a 2019 Ram 1500 (Subject Vehicle) on August 12, 2019.

On February 4, 2025, Plaintiff filed a notice of settlement of the entire case.

On March 7, 2025, the parties filed a signed 998 Offer to Compromise.

On March 26, 2025, Plaintiff filed the present motion. A hearing on the present motion and an order to show cause re: dismissal are set for May 1, 2025.

On April 1, 2025, the court entered judgment after the parties submitted a stipulated judgment under the 998 Offer to Compromise.

ANALYSIS

Plaintiff seeks recovery of prejudgment interest based on the Subject Vehicle’s purchase price. For the following reasons, the court DENIES Plaintiff’s motion.

Legal Standard

Prejudgment interest is typically awarded on one of three grounds.

First, prejudgment interest is available for liquated claims, where the damages are certain or can be determined through calculation. (Civ. Code, § 3287, subd. (a).) In such cases, the court must grant prejudgment interest upon request from the first day that both a breach and a liquidated claim exist. (North Oakland Medical Clinic v. Rogers¿(1998) 65 Cal.App.4th 824, 828; Howard v. American Nat’l Fire Ins. Co. (2010) 187 Cal.App.4th 498, 535.)

Second, prejudgment interest can be awarded on unliquidated contract claims, where the damages from the contract claim are not certain. (Civ. Code, § 3287, subd. (b).) In these instances, the court has discretion to decide whether interest should be awarded and the date from which such interest should be awarded – though it cannot be earlier than the date when plaintiff filed the action. (Civ. Code, § 3287, subd. (b); North Oakland, supra, 65 Cal.App.4th at p. 829.)

Lastly, prejudgment interest is available for unliquidated tort claims at “the discretion of the jury” or by the court in nonjury trials. (Civ. Code, § 3288; Bullis v. Security Pacific Nat’l Bank (1978) 21 Cal.3d 801, 814.)

Discussion

In this case, Plaintiff requests prejudgment interest under Civil Code section 3287, subdivisions (a) and (b). The court does not find Plaintiff is entitled to prejudgment interest under the terms of the 998 offer Plaintiff accepted, or pursuant to Civil Code, section 3287(a). Further, the court declines to exercise its discretion to award prejudgment interest pursuant to Civil Code, section 3287(b).

998 Offer to Compromise

FCA asserts Plaintiff is not entitled to prejudgment interest based on the terms of the accepted 998 Offer to Compromise. (Opp., pp. 2:9-3:2.) The court agrees.

FCA contends that Plaintiff’s request for prejudgment interest conflicts with the terms of the accepted 998 Offer to Compromise, as the terms explicitly allow for post-judgment interest and do not mention prejudgment interest. (Opp., p. 2:17-21; Rotman Decl., Exh. 2, ¶¶ 2, 6.) Additionally, FCA asserts that awarding prejudgment interest would be akin to adding terms to the accepted offer. (Opp., p. 2:25-27.)

In countering FCA’s position, Plaintiff fails to provide the court with statutory authority or case law that permits the award of prejudgment interest when the language of a 998 offer fails to explicitly provide for such. Furthermore, Plaintiff does not adequately explain the basis upon which the court may deviate from the explicit language of a 998 offer.

Mandatory Interest

Plaintiff claims entitlement to prejudgment interest under Civil Code section 3287, subdivision (a). (Motion, pp. 2:15-7:8.) The court disagrees.

Whether a defendant is liable for prejudgment interest under Civil Code section 3287, subdivision (a) depends on whether the “defendant actually know[s] the amount owed or from reasonably available information could the defendant have computed that amount.” (Duale v. Mercedes-Benz USA, LLC (2007) 148 Cal.App.4th 718, 729.) “The statute . . . does not authorize prejudgment interest where the amount of damage, as opposed to the determination of liability, depends upon a judicial determination based upon conflicting evidence, and it is not ascertainable from truthful data supplied by the claimant to his debtor. Thus, where the amount of damages cannot be resolved except by verdict or judgment, prejudgment interest is not appropriate.” (Ibid., citations, quotations, and emphasis omitted.)

In determining whether a claimant is entitled to prejudgment interest under Civil Code section 3287, subdivision (a), the key factor is whether the defendant knew the amount of damages owed or could have computed that amount from reasonably available information. (Duale, supra, 148 Cal.App.4th at p. 729.) Uncertainty regarding liability does not preclude prejudgment interest in a civil action. (Ibid.) The certainty required under Civil Code section 3287, subdivision (a) is not lost when the existence of liability turns on disputed facts, but rather only when the amount of damages in in dispute. (Ibid.)

The court will consider damages as “capable of being made certain by calculation” if the amount due can be determined using a fixed standard, e.g., a payment schedule, a readily ascertainable market value, or data supplied by the plaintiff to the defendant. (Marine Terminals Corp. v. Paceco (1983) 145 Cal. App. 3d 991, 996.)

Plaintiff moves for mandatory prejudgment interest based on the total sales price of the Subject Vehicle, not including the requested incidental, consequential, or civil penalty damages. (Motion, p. 1:20-22; Reply, p. 2:21-27.) Plaintiff attempts to collect prejudgment interest on the Subject Vehicle’s sales price to circumvent the limitations imposed under Civil Code section 3287, subdivision (a). Plaintiff admits the incidental, consequential, and civil penalty damages were uncertain when the parties settled. (Reply, p. 2:23-24.) However, Plaintiff fails to provide any case law or statutory authority to support Plaintiff’s attempt to argue around Civil Code section 3287, subdivision (a)’s restrictions.

For this reason, the court declines to award mandatory prejudgment interest pursuant to Civil Code, section 3287(a).

Discretionary Interest

Finally, Plaintiff argues that Plaintiff should receive prejudgment interest under Civil Code section 3287, subdivision (b). (Motion, pp. 7:9-10:2.) The court disagrees.

“A plaintiff that is entitled to recover damages on a contract claim that was unliquidated until the judgment was rendered may recover prejudgment interest on these damages at the judge’s discretion.” (Civ. Code § 3287, subd. (b).) Civil Code section 3287, subdivision (b) enables courts to award prejudgment interest despite the uncertain amount owed on a contract claim for unliquidated damages. (Hewlitt-Packard Co v. Oracle Corp. (2021) 65 CA 5th 506, 575-581.) Therefore, it contradicts the statutory scheme when the court refuses to award prejudgment interest for the sole reason that the amount of damages is highly uncertain. (Ibid.)

FCA argues that this court should not award prejudgment interest under Civil Code section 3287, subdivision (b) because Plaintiff’s right to recovery did not accrue on a specific day and “there has been no finding as to the date of the breach of contract.” (Opp., p. 7:1-13.) The court agrees.

FCA cites Civil Code section 3287, subdivision (a), Chesapeake Industries, Inc. v. Togova Enterprises, Inc. (1983) 149 Cal.App.3d 901, 906, fn. 4, and Bare v. Richman & Samuels, Inc. (1943) 60 Cal.App.2d 413, 419 to support this argument. (Opp., p. 7:4-7.) However, Plaintiff also moves for discretionary prejudgment interest under Civil Code section 3287, subdivision (b), while the cited cases involve Civil Code section 3287, subdivision (a). (Chesapeake Industries, Inc. v. Togova Enterprises, Inc., supra, 49 Cal.App.3d at pp. 906-907; Bare v. Richman & Samuels, Inc., supra, 60 Cal.App.2d at p. 419.) Therefore, the court finds neither case helpful to its analysis.

Balancing the equities, and considering the fact that the accepted 998 offer is silent as to prejudgment interest, this court finds that Plaintiff is not entitled to prejudgment interest pursuant to Civil Code section 3287, subdivision (b). In exercising this discretion to deny prejudgment interest on this basis, the court finds the ruling in Carmel Development Co., Inc. v. Anderson (2020) 48 Cal.App.5th 492 instructive. The Carmel court upheld a trial court’s award of discretionary prejudgment interest where the time for accrual was set one year after filing. (Carmel, supra, 48 Cal.App.5th 492 at p. 525.) The Carmel court held that it was proper for the trial court to consider the time and money spent by the moving party during the litigation’s pendency. (Ibid.) The Carmel court further found that it was proper for the trial court to weigh this consideration against the fact that the amount of damages was not instantly discoverable upon filing the complaint. (Ibid.)

Here, the complaint’s filing did not make Plaintiff’s damages certain, as Plaintiff prayed for damages “according to proof.” (Opp., p. 4:7-8.) Further, Plaintiff accepted Defendant’s 998 offer that was silent as to prejudgment interest. The court finds that these facts weigh against awarding prejudgment interest.

Accordingly, Plaintiff’s request for prejudgment interest is DENIED.

CONCLUSION

Based on the foregoing, Plaintiff’s motion for prejudgment interest is DENIED.

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