Opinion ID: 571517
Heading Depth: 3
Heading Rank: 1

Heading: Starting date for interest accrual.

Text: 23 The district court held that pre-judgment interest accrued on all five overdue withdrawal liability payments from the due date of the first installment, February 20, 1988. 4 CCC argues that the interest on the five overdue withdrawal liability payments--due 2/20/88, 5/20/88, 8/20/88, 11/20/88, and 2/20/89--accrued from the due date of each respective installment rather than from the due date of the first installment. In other words, the interest owed on the first payment ran from February 20, 1988, the interest owed on the second payment ran from May 20, 1988, and so forth. Several considerations persuade us that CCC's calculation is correct. 24 First, as explained above, the interest calculation is governed by 29 U.S.C. § 1132(g)(2) when an action to collect a withdrawal liability payment is brought under 29 U.S.C. § 1451. Neither § 1132(g)(2) nor the regulation thereunder specifies the starting date for interest accrual. However, 29 U.S.C. § 1399(c)(3) expressly provides that if a withdrawal liability payment is not made on the installment due date, then interest shall accrue from that due date. The regulation thereunder also expressly so states. 29 C.F.R. § 2644.3. In other words, the interest runs from the due date of each respective installment. We believe it is appropriate to borrow the accrual date from § 1399(c)(3) because § 1132(g)(2) and § 1399(c)(3) both provide for interest on delinquent withdrawal liability payments. The only difference between the two sections is that § 1399(c)(3) contemplates payment of the interest without the necessity of filing suit, while § 1132(g)(2) governs the interest calculation when suit is filed to collect the delinquent payment. The Plan argues that there should be a penalty for imposing the necessity of filing suit and that the penalty should be an acceleration of the subsequent installment due dates. We reject the Plan's argument; § 1132(g)(2) has separate provisions to penalize the delinquent payor for imposing the necessity of a suit to collect. See 29 U.S.C. § 1132(g)(2)(C)(i) (double interest); 29 U.S.C. § 1132(g)(2)(D) (attorneys' fees and costs). 25 Second, the district court's interest calculation is, in effect, a retroactive acceleration of interest on CCC's overdue payments. That is, § 1399(c)(3) makes it clear that interest on any delinquent withdrawal liability installment payment accrues on the due date of such installment. By holding that interest on all delinquent payments accrued on the due date of the first delinquent installment, the district court in effect accelerated the due date of each succeeding installment to the due date of the first installment. This acceleration is inconsistent with the holding of this court in the prior appeal that such acceleration was inappropriate. 896 F.2d at 1346 n. 29. 26 Third, the language of 29 U.S.C. § 1451(b) and 29 U.S.C. § 1132(g)(2) strongly points to the construction urged by CCC. Section 1451(b) provides that any failure of the employer to make any withdrawal liability payment within the prescribed time shall be treated in the same manner as a delinquent contribution. Thus, with respect to each withdrawal liability installment, the right to sue is triggered by the failure to pay the installment within the prescribed time, i.e., at the due date of each installment. 27 Significantly, § 1451(b) provides that a suit to collect a delinquent withdrawal liability installment shall be treated in the same manner as a delinquent contribution. When withdrawal liability payment is substituted for contribution in § 1132(g)(2)'s interest provisions, § 1132(g)(2) provides for interest on the unpaid contribution withdrawal liability payment. Thus, § 1132(g)(2) provides for interest only on unpaid withdrawal liability payments. A withdrawal liability installment is not unpaid until after its respective due date. 5 28 For the foregoing reasons, we conclude that the interest on CCC's five delinquent withdrawal liability payments accrued from the due date of each respective installment. 29