Vázquez-Filippetti v. Cooperativa De Seguros Múltiples De Puerto Rico
723 F.3d 24
1st Cir.2013Background
- Plaintiffs obtained a six-million-dollar damages award in a diversity suit for injuries from a car crash involving Toro and insureds under Cooperativa’s policy.
- Toro’s car, owned by Toro-Rodríguez’s brother and insured by Cooperativa, had a $100,000 per-person bodily-injury limit.
- District court judgment apportioned liability: bank 75%, Cooperativa and insureds 25%; later amended to joint and several liability for full six million.
- Cooperativa deposited $75,000 (the policy limit) into court in September 2005; plaintiffs sought postjudgment interest on the full six million from entry of judgment.
- District court denied postjudgment-interest as untimely and because the policy did not provide postjudgment interest; plaintiffs appealed.
- Court interprets the policy’s Supplementary Payments as a standard-interest clause obligating payment of postjudgment interest on the full judgment against insureds.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Cooperativa owes postjudgment interest on the full judgment. | Plaintiffs: standard-interest clause obligates postjudgment interest on full judgment. | Cooperativa: interest ceases when it pays its policy-limit portion; timely objection required. | Yes; Cooperativa pays postjudgment interest on full judgment for the period before deposit. |
| What is the duration of Cooperativa's postjudgment-interest obligation? | Interest accrues from entry of judgment until deposit of policy limit. | Obligation ends when it offers to pay the part due under policy limits. | Interest accrues until deposit; obligation ceases after deposit of the limit. |
| Does Puerto Rico law govern interpretation of the policy or federal postjudgment-interest law? | Puerto Rico law governs contract interpretation; postjudgment interest governed by federal statute. | Federal law governs entitlement to postjudgment interest; contract interpretation follows Puerto Rico law. | Federal law governs entitlement; Puerto Rico law governs contract interpretation (plain-meaning). |
Key Cases Cited
- Kaiser Aluminum & Chem. Corp. v. Bonjorno, 494 U.S. 827 (U.S. 1990) (postjudgment interest awarded under statute; bears on entitlement timing)
- Tobin v. Liberty Mut. Ins. Co., 553 F.3d 121 (1st Cir. 2009) (federal postjudgment-interest entitlement governs in federal actions)
- Cummings v. Standard Register Co., 265 F.3d 56 (1st Cir. 2001) (federal postjudgment-interest entitlement in diversity cases)
- Fratus v. Republic W. Ins. Co., 147 F.3d 25 (1st Cir. 1998) (standard-interest clause interpretation in insurance policies)
- United States v. Michael Schiavone & Sons, Inc., 450 F.2d 875 (1st Cir. 1971) (postjudgment-interest entitlement follows statute; no discretion to deny)