Opinion ID: 1707287
Heading Depth: 1
Heading Rank: 1

Heading: should prejudgment interest have been allowed to plaintiffs?

Text: Gloria Simpson argues that she should have been awarded prejudgment interest on the jury award in Simpson II. She made a Motion to Assess Prejudgment Interest after the trial in Simpson II. The Motion asked for interest beginning on August 16, 1978, the date of the loss, or beginning sixty days after the day of the loss. After argument the Motion was overruled. An award of prejudgment interest rests in the discretion of the awarding judge. Under Mississippi law prejudgment interest may be allowed in cases where the amount due is liquidated when the claim is originally made, or where the denial of the claim is frivolous or in bad faith. Aetna Casualty & Surety Co. v. Doleac Electric Co., 471 So.2d 325, 331 (Miss. 1985) (citations omitted); see also State Farm Mutual Automobile Insurance Co. v. Bishop, 329 So.2d 670 (Miss. 1976) (interest allowed because of insurer's bad faith). As to whether a claim is liquidated, interest has been denied where there is a bona fide dispute as to the amount of damages as well as the responsibility for the liability therefor. Grace v. Lititz Mutual Insurance Co., 257 So.2d 217, 225 (Miss. 1972). The insured must include a proper demand or request for prejudgment interest, including from when it is allegedly due, in the pleadings. Maryland Casualty Co. v. Legg, 247 So.2d 812 (Miss. 1971). In accord is Commercial Union Insurance Co. v. Byrne, 248 So.2d 777 (Miss. 1971), where the Court stated: [I]t seems to be clear from what was said in these cases and other cases that where there is a total loss and the valued policy statute comes into play, the insured is entitled to interest from the time the payment is due, provided a proper demand for interest is made. It is also clear where the loss payable under fire or windstorm policy is liquidated or is capable of being made certain by a mere calculation the insurer is liable for interest if properly demanded from the date payment is due under the terms of the policy. ... . We are of the opinion that where as in this case there is a justifiable dispute as to the amount of the loss, the insured is not entitled to interest until the amount of the claim has been made certain or liquidated. However, we can envision cases where, in the discretion of the trial court interest should be allowed although the amount of the loss is in dispute and for this reason we do not foreclose the allowance of interest in every case where the claim in unliquidated. Byrne, 248 So.2d at 783. The request for interest from the date of August 16, 1978, was properly included in the Simpsons' declaration (complaint). Because this Court reversed and rendered on the issue of bad faith in Simpson I, it cannot serve as a basis for an award of prejudgment interest. The remaining question is whether the amount due the Simpsons was liquidated when their claim was originally made. The complaint alleged, and State Farm admitted in its answer, that the insured premises and its contents were a total loss. There was no question as to the amount of the coverages involved. This amounts to a liquidated claim, and as such the trial court erred in not allowing prejudgment interest. The policy in question states that [t]he amount of loss for which this Company may be liable shall be payable sixty days after proof of loss, as herein provided, is received by this Company and ascertainment of the loss is made either by agreement between the insured and this Company expressed in writing or by the filing with this Company of an award as herein provided. The Simpsons executed their sworn proof of loss on October 6, 1978. Gloria Simpson is entitled to prejudgment interest at the rate of 8% per annum accruing from December 6, 1978. Davis v. Continental Casualty Co., 560 F. Supp. 723 (N.D.Miss. 1983); Miss. Code Ann. § 75-17-7 (Supp. 1978) (setting rate for postjudgment interest).