Opinion ID: 2380307
Heading Depth: 3
Heading Rank: 1

Heading: Whether the City Is Exempt From Post-Judgment Interest Under Section 56-8-4(D)

Text: {12} We begin our analysis with Section 56-8-4(A), which provides, in relevant part, that [i]nterest shall be allowed on judgments and decrees for the payment of money from entry and shall be calculated at the rate of eight and three-fourths percent per year. Thus, [p]ostjudgment interest on judgments and decrees for payment of money is mandatory and accrues at the statutory rate from the date of entry of judgment. Sunwest Bank v. Colucci, 117 N.M. 373, 379, 872 P.2d 346, 352 (1994). However, subsection (D) of Section 56-8-4 provides that [t]he state and its political subdivisions are exempt from an award of post-judgment interest except as otherwise provided by statute or common law. (Emphasis added.) Thus, post-judgment interest is generally available to successful plaintiffs under subsection (A) of Section 56-8-4, but subsection (D) bars the collection of interest against government defendants unless otherwise provided by statute or common law. {13} To resolve the claim on appeal, we must determine whether the statutory language as otherwise provided in Section 56-8-4(D) refers solely to state statutes and common law or whether it contemplates federal statutes and common law as well. In interpreting Section 56-8-4(D), our primary focus is the plain language of the statute, and we refrain from adding words to the statutory text unless necessary to conform the statute to legislative intent or to prevent an absurd result. See Maestas, 2007-NMSC-001, ¶ 15, 140 N.M. 836, 149 P.3d 933; Ogden, 118 N.M. at 242, 880 P.2d at 853. Section 56-8-4(D) provides that the bar on post-judgment interest is not applicable where statute or common law dictates otherwise. {14} Accordingly, post-judgment interest may be collected against the state and its political subdivisions where statute or common law so permits. The City would have us read statute to mean state statute, thereby removing federal law permitting the collection of post-judgment interest from the purview of the exception. Such a construction, however, forces us to add words to the statutory text. We discouraged such a practice in Maestas and, accordingly, decline to supplement the statutory text in the present instance. 2007-NMSC-001, ¶ 15, 140 N.M. 836, 149 P.3d 933. Rather, we look to the plain language which does not limit the scope of applicable law to state statutes. Because Section 56-8-4(D) contains no limiting language, we conclude that political subdivisions enjoy immunity from post-judgment interest except where state or federal statutes provide otherwise. {15} We next must determine whether the Legislature intended Section 1961 to constitute law which otherwise provides for post-judgment interest against a governmental defendant. When the Legislature enacts a statute we presume that it is aware of existing statutes. State v. Marquez, 2008-NMSC-055, ¶ 7, 145 N.M. 1, 193 P.3d 548; accord Inc. Cnty. of Los Alamos v. Johnson, 108 N.M. 633, 634, 776 P.2d 1252, 1253 (1989) (We presume that the legislature is well informed as to existing statutory and common law. ...). In 1983, the Legislature rewrote Section 56-8-4 such that it allowed interest on judgments generally, but exempted the state from its provisions except as otherwise provided by law. Folz v. State, 115 N.M. 639, 641, 857 P.2d 39, 41 (Ct.App. 1993). Compare 1980 N.M. Laws, ch. 68, § 2 (prior version of Section 56-8-4), with 1983 N.M. Laws, ch. 254, § 2 (adding Section 56-8-4(D), exempting government defendants from paying interest). In 1983, federal statutes awarding post-judgment interest had long been in existence; indeed, the provision that was later codified as Section 1961 was enacted in 1842. See Brock v. Richardson, 812 F.2d 121, 125 & n. 4 (3d Cir.1987) (noting Act of August 23, 1842, ch. 188, § 8, 5 Stat. 516, 518 is a predecessor statute to Section 1961). {16} When interpreting Section 56-8-4(D), we conclude the Legislature enacted Section 56-8-4(D) against the backdrop of federal legislation that permitted the collection of post-judgment interest. Therefore, in Section 1983 actions, we read the two statutory provisions in harmony. We hold that the Legislature contemplated Section 1961 as law which otherwise provides for post-judgment interest against the state and its political subdivisions within the meaning of Section 56-8-4(D); accordingly, where a plaintiff prevails in a Section 1983 action, Section 56-8-4(D) incorporates the award of post-judgment interest from Section 1961. {17} We also note that this interpretation places Section 56-8-4(D) in harmony with Section 1983 and its remedial goals. A central objective of Section 1983 is to enable those deprived of their civil rights to recover full compensation from the governmental officials responsible for those deprivations. Felder v. Casey, 487 U.S. 131, 153, 108 S.Ct. 2302, 101 L.Ed.2d 123 (1988) (emphasis added), superseded by statute on other grounds as stated in Higgason v. Stogsdill, 818 N.E.2d 486, 489 (Ind.Ct.App.2004); see also Hardin v. Straub, 490 U.S. 536, 539, 109 S.Ct. 1998, 104 L.Ed.2d 582 (1989) (noting that the chief goals of Section 1983 are  compensation and deterrence (emphasis added)); Burnett v. Grattan, 468 U.S. 42, 53, 104 S.Ct. 2924, 82 L.Ed.2d 36 (1984) (identifying compensation as a goal of federal civil rights legislation). Thus, Section 1983 is intended to secure full compensation for litigants deprived of their civil rights. {18} Where a judgment is not timely satisfied, post-judgment interest is a key element of full compensation. The Court of Appeals held below that post-judgment interest serves only as an enforcement mechanism which encourages prompt payment of judgments. ACP III, 2009-NMCA-065, ¶ 57, 146 N.M. 568, 212 P.3d 1122. In light of this view, the Court held that post-judgment interest is unnecessary to ensure the achievement of Section 1983's remedial objectives. ACP III, 2009-NMCA-065, ¶ 57, 146 N.M. 568, 212 P.3d 1122. We disagree. Both the U.S. Supreme Court and our Court of Appeals have emphasized that post-judgment interest serves as more than an enforcement mechanismit ensures that a monetary award does not erode in value over time. See Kaiser Aluminum & Chem. Corp. v. Bonjorno, 494 U.S. 827, 835-36, 110 S.Ct. 1570, 108 L.Ed.2d 842 (1990) ([T]he purpose of postjudgment interest is to compensate the successful plaintiff for being deprived of compensation for the loss from the time between the ascertainment of the damage and the payment by the defendant. (alteration in original) (internal quotation marks and citation omitted)); accord Bird v. State Farm Mut. Auto. Ins. Co., 2007-NMCA-088, ¶ 42, 142 N.M. 346, 165 P.3d 343 (concluding that an award of post-judgment interest compensates the plaintiff for being deprived of compensation from the time of the judgment until payment ... by the defendant (internal quotation marks and citation omitted)). Where the passage of time has diminished the value of a plaintiffs award, post-judgment serves to restore the award to its proper value. Section 1983's central goal of providing full compensation to those deprived of their civil rights would be undercut if post-judgment interest were not awarded. The restorative effect of post-judgment interest is necessary to ensure full compensation is remitted. These considerations bolster our conclusion that Section 56-8-4(D) contemplates Section 1961 as law which otherwise provides for post-judgment interest against the state and its political subdivisions. {19} The City argues that ACP is not entitled to post-judgment interest because subsection (c)(4) of Section 1961 prevents the application of the statute in state courts. Subsection (c)(4) states that Section 1961 shall not be construed to affect the interest on any judgment of any court not specified in this section. The City contends that this subsection conclusively limits the application of Section 1961 to the federal courts. {20} We recognize that subsection (c)(4) has been taken to mean that Section 1961 cannot be directly invoked in state courts. Gaulin, 505 N.E.2d at 901. However, our holding does not rely on the direct application of the federal statute in state court. We rely instead on our own state law, interpreting Section 56-8-4(D) to permit an award of post-judgment interest against the state and its political subdivisions pursuant to a statute (in this case, Section 1961(a)) which otherwise permits.