Opinion ID: 4540946
Heading Depth: 2
Heading Rank: 1

Heading: 2d 152, 165 (Md. 2001)). They are as follows:

Text: 1. Prejudgment interest must be granted where “the obligation to pay and the amount due” were “certain, definite, and liquidated by a specific date prior to judgment.” Buxton, 770 A.2d at 165 (quoting First Va. Bank v. Settles, 588 A.2d 803, 807 (Md. 1991)). Interest accrues from when “payment was due.” I. W. Berman Props. v. Porter Bros., 344 A.2d 65, 75–76 (Md. 1975) (quoting Affiliated Distillers Brands Corp. v. R. W. L. Wine & Liquor Co., 132 A.2d 582, 586 (Md. 1957)). 7 2. Prejudgment interest may not be granted “in tort cases where the recovery is for bodily harm, emotional distress, or similar intangible elements of damage not easily susceptible of precise measurement.” Buxton, 770 A.2d at 165. 3. Prejudgment interest may be granted, but is not required, in the remaining “broad category of contract cases.” Id. In this catchall category, which is the default for contract cases, Harford Cty., 923 A.2d at 13–14 (citing Ver Brycke v. Ver Brycke, 843 A.2d 758, 777 (Md. 2004)), whether to order prejudgment interest “is within the discretion of the trier of fact,” Buxton, 770 A.2d at 165. Courts must determine whether a contract case falls under the first or third category based on their level of certainty as to the existence, amount, and due date of an obligation to pay. 8 The rationale is that, where such certainty exists, “the effect of the debtor’s 7 Maryland’s rule in such cases is endorsed by the Restatement (Second) of Contracts. See Crystal v. West & Callahan, Inc., 614 A.2d 560, 572–73 (Md. 1992) (citing Restatement (Second) of Contracts § 354(1) (Am. Law Inst. 1981)). 8 Compare Harford Cty., 923 A.2d at 14 (prejudgment interest mandatory because a specific amount was owed on a specific date), and E. Park Ltd. P’ship v. Larkin, 893 A.2d 1219, 1235 (Md. 2006) (prejudgment interest mandatory on portion of judgment that was 16 withholding payment [is] to deprive the creditor of the use of a fixed amount as of a known date,” and mandatory prejudgment interest is meant to rectify the situation. Buxton, 770 A.2d at 165 (quoting Settles, 588 A.2d at 807). Where the impact of withholding payment is less certain, the trier of fact has discretion to award prejudgment interest as appropriate to the unique circumstances of the case. E.g., Crystal, 614 A.2d at 573. Here, “the obligation to pay and the amount due” were “certain, definite, and liquidated by a specific date prior to judgment.” Settles, 588 A.2d at 807 (quoting David Sloane, Inc. v. Stanley G. House & Assocs., 532 A.2d 694, 702 (Md. 1987)). So this case falls under the first category, and prejudgment interest is mandatory. The district court apparently agreed. See J.A. 255 & n.1 (finding Parkway to be “entitled” to prejudgment interest, and citing a case involving “a liquidated sum of money [owed] at a certain time”). But the district court erred as a matter of law in concluding, based on equitable principles, that Parkway was entitled to interest accruing from May 2008. In cases within the first category, prejudgment interest accrues from the date where “the obligation to pay and the amount due” were both “certain.” Settles, 588 A.2d at 807 (emphasis added); see Gordon v. Posner, 790 A.2d 675, 698 (Md. Ct. Spec. App. 2002) (“[A] right to prejudgment interest only exists when liability and damages are certain . . . .”). “‘certain, definite, and liquidated’ from the time the case was remanded by the Court of Appeals”), with Ver Brycke, 843 A.2d at 761–62, 777–78 (prejudgment interest discretionary in complex family dispute involving whether monetary gift was conditional or absolute), Crystal, 614 A.2d at 562, 573 (prejudgment interest discretionary in dispute between contractor and homeowner regarding work on home), and I. W. Berman Props., 344 A.2d at 77 (prejudgment interest discretionary in construction contract dispute). 17 Here, as noted, the contract did not create any obligation for U.S. Home to pay Parkway the Reimbursement until the time of Settlement. However, as of the date of Settlement, the Reimbursement was a specific amount that was definitively owed. This case falls within the first, mandatory category, and Parkway is entitled to prejudgment interest as of right—but only from the date the Reimbursement came due, that is, the date of Settlement in 2017. We therefore vacate the district court’s order and remand with directions to order prejudgment interest as of right accruing from April 21, 2017.