Opinion ID: 2978973
Heading Depth: 4
Heading Rank: 3

Heading: Pre-Judgment Interest for Hillerich

Text: Pre-judgment interest must be awarded as a matter of law to prevailing parties when the damages are liquidated. Damages are liquidated when the amount in question is either agreed upon by the parties or is fixed by operation of law or the parties. See Nucor Corp. v. General Elec., Co., 812 S.W.2d 136, 141 (Ky. 1991). If damages are unliquidated, the court has discretion whether to award pre-judgment interest. See Hale v. Life Ins. Co. of N. Am., 795 F.2d 22, 24 (6th Cir. 1986). The district court did not award pre-judgment interest to Hillerich because it determined that the attorney’s fees and other defense costs were not liquidated. Hillerich argues the damages were liquidated because the fees were due on an open account, and an amount due on an open account has been considered liquidated under Kentucky law. See Poundstone v. Patriot Coal Co., Ltd., 485 F.3d 891, 903 (6th Cir. 2007). Travelers argues that because the amounts were uncertain at the time of the breach and not readily calculable from market rates, the damages were unliquidated. See 3D Enterprises Contracting Corp. v. Louisville & Jefferson County Metro. Sewer Dist., 174 S.W.3d 440, 450 (Ky. 2005). The district court correctly concluded that the key issue is whether the amount is fixed as between the parties to the litigation either by agreement or operation of law. Travelers was not privy to the amounts Hillerich owed on its open account with its defense counsel prior to Travelers taking on the defense costs after the Second Amended Complaint was filed. Hillerich has offered no proof that Travelers knew or should have known of those amounts due, and so as between Travelers and Hillerich, the damages were not liquidated. Therefore, it was entirely within the district court’s discretion whether to award prejudgment interest, see Poundstone, 485 F.3d at 903, and we find no abuse of discretion in the decision to deny such interest. Case Nos. 09-5113/5136 Travelers Prop. Cas. Co., et al. v. Page 24 Hillerich & Bradsby Co., Inc. 4. Proper Damages and Interest Awarded to Both Parties Hillerich tendered to Travelers what it still contends was the First Amended Complaint on March 19, 1999. While that version was a draft version attached as an exhibit to Baum’s Motion for Reconsideration, it was sufficient to constitute constructive tender of the suit to Travelers such that Travelers owes damages from its breach of the duty to defend from the November 8, 1999 filing of the First Amended Complaint. Travelers waived its arguments regarding the reasonableness of Hillerich’s defense costs by not raising the arguments in its original pleading demanding entry of a final order and awarding of damages. The district court did not abuse its discretion in awarding simple pre-judgment interest to Travelers and in denying pre-judgment interest to Hillerich.