Court Opinion

ID: 9726995
Source: CourtListenerOpinion
Date Created: 2023-08-26 13:16:35.884211+00
Date Added: 2024-06-11T18:25:32.643125
License: Public Domain

CONCURRING & DISSENTING OPINION
BY TODD, J.:
¶ 1 I join in the Majority’s resolution of each of the issues raised by the parties in these cross-appeals with one exception: I cannot agree that PCC is entitled to 18% pre- and post-judgment interest. On that issue, I must dissent from the view of my distinguished colleagues.
¶ 2 Two provisions of the construction agreement at issue provide that PCC is entitled to 18% interest on sums withheld by the Griffiths “without cause”. (See Agreement for Construction of a Dwelling in the Summerlawn Plan of Lots, 4/24/99, at ¶ IV.B (“If any payments, as specified in this Agreement, are withheld, without cause, by the Owner, the Owner will pay additional fees of 18% per year on the outstanding balance, and that the warranty will be void until all monies are paid.” (emphasis added))); id. at ¶XII (“In the event the Owner shall fail without cause, to make full and final settlement as specified in this Agreement, ... all other unpaid sums due the Contractor shall bear interest at the rate of 18% per annum from the date such final was due until paid.” (emphasis added)).
¶ 3 The Majority acknowledges these contractual terms; but concludes that because the jury determined the Griffiths breached the contract by withholding payments, such breach equates to withholding payments without cause. (See Majority Opinion, at 593.) The Majority adds “[t]he fact that the amount of money owed was contested by the Griffiths in good faith does not affect PCC’s entitlement to the contractual interest rate.” (Id. at 593.) I disagree.
¶ 4 The cases cited by the Majority in support of this conclusion — Metropolitan Edison Co. v. Old Home Manor, Inc., 334 Pa.Super. 25, 482 A.2d 1062 (1984) and Osial v. Cook, 803 A.2d 209 (Pa.Super.2002) — are inapposite, as both of those cases concern statutory interest, not contractual interest. I do not dispute that PCC is entitled to statutory interest, or that good faith conduct is not relevant to the imposition of statutory interest. PCC’s entitlement to 18% interest, however, is based solely on the contractual terms agreed upon by the parties. Here, the contract clearly states that PCC is entitled to the 18% rate only where payment is withheld “without cause”. I cannot conclude that where the withholding of funds breaches the agreement, that that necessarily means the funds are withheld without cause. Indeed, such a conclusion would read the phrase “without cause” out of the agreement, which we are obliged not to do when interpreting a contract. See, e.g., Meeting House Lane, Ltd. v. Melso, 427 Pa.Super. 118, 126, 628 A.2d 854, 857-58 (1993) (“One part of a contract cannot be interpreted so as to annul another part, and a contract must be construed, if possible, to give effect to all of its terms.”). Further, the Majority’s conclusion that the Griffiths contested the amounts due in good faith at least raises an issue of whether they had cause for doing so.
*595¶ 5 Accordingly, I believe it was a jury question whether the Griffiths withheld funds due under the contract without cause so as to trigger the 18% interest rate. Cf. Shared Communications Serv. of 1800-80 JFK Blvd. Inc. v. Bell Atlantic Prop. Inc., 692 A.2d 570, 577 (Pa.Super.1997) (sufficient evidence was proffered to allow the jury to determine the proper contract rate of interest). As this issue was not presented to the jury, I would find that PCC has waived its entitlement to contractual interest of 18%.
¶ 6 Nonetheless, PCC is entitled to statutory pre- and post-judgment interest of 6%. To this end, I would remand for a calculation of both pre- and post-judgment interest as prescribed by the Majority, but at a rate of 6%.