Grynberg v. Roberts

GRYNBERG, Jack Jack d/b/a Associates, Plaintiff-Appellee Cross-Appellant, al., Defendants-Ap- ROBERTS,

Victor et

pellants Cross-Appellees.

No. 15007.

Supreme New Mexico. Court of

April

561 Expenditures.” “Authorization For signed 1974 each defendant had such an agreement for each of the six wells in- volved in this suit. Each authorization agreement listed for each well the estimat- “intangible drilling ed dollar amounts for costs,” costs,” “tangible completion and “intangible completion costs”. Additional- agreements recorded each defend- ly, the specific percentage working inter- ant’s proportion- separate est and his estimated well. ate total cost for that against working A claim of lien the against every filed est each well was by Grynberg in 1977. At that defendant for each Grynberg time filed a document date, listing defendant the invoice number owed each and amount of indebtedness on each invoice. Included was defendant to date” on each the amount of “interest (cid:127) total indebtedness. These doc- defendant’s period from 1974 to uments covered a time Jr., Behles, Martin, Carls- Martin & W.T. portion A of the 1974-1975 cost was bad, defendants-appellants and cross- for defendants and was paid by certain of the appellees. summary. not included in the 1977 debt Kirk, Albuquerque, Chad Dick- James E. case, complaint in the instant In his erson, Artesia, plaintiff-appellee and requested “reasonable interest” Grynberg cross-appellant. alleged drilling operation and costs he on Find- were owed to him the defendants. OPINION Gryn- ings by the trial court showed SOSA, Senior Justice. berg required pay twenty percent to appeals Plaintiff from a failure to cov- interest on the amount he borrowed prejudgment interest trial court to award However, the er the defendant’s costs. Plaintiff in a suit for breach of contract. found it could not allow court several other Grynberg sued Roberts and on monies bor- reimbursement for interest agreement of an defendants for breach Grynberg submitted no evi- rowed because cost to drill pay proportionate shares of the the amounts or dence whatsoever as to The trial operate certain oil wells. borrowed, or the actu- sums were dates the granted judgment Grynberg on the court covering costs. paid in these al interest indebtedness, principal failed to award but Gryn- ascertained and awarded The court interest” on the requested “reasonable him of monies owed to berg exact sums We reverse on that is- principal awarded. individually under each each defendant sue. agreement, no interest. but awarded question appeal is whether The sole prejudg- Grynberg claims he is due should attend interest him, on the amount awarded ment interest Grynberg. the amount awarded money had use of that since he has not owing initially due and from the time it was that since 1975 the The trial court found Grynberg did not seek present. paid share of the defendants had not their paid for the actual their reimbursement drilling operational costs under Citing to money borrowed. agreement agreements. In evidence were Shaeffer Kelton, 619 P.2d parties, titled forms entered into 56-8-3, forerunner, he trial court erred not tion asserts that the its statutory awarding 50-6-3, interest allowed on Section allow prejudgment a contract under NMSA due on certain instances. O’Meara and (Orig.Pamp. Section and Cum. adopted stated in Re- 56-8-3, Supp.1984). governing the Section (1932): statement provides: contract interest rate on a parties If the not have interest, The in the of rate of absence otherwise, simple determined at rate, fixing a written contract a different statutory legal the is rate as recoverable percent shall than be not more fifteen damages of for breach contract as fol- annually following in cases: the lows: contract; money A. on due (a) where the defendant a commits money B. on received to the use of pay breach of a to contract a definite another and retained without the owner’s of money, perform- sum or to render a expressed implied; consent or the ance value of in is money which money upon C. on due the settlement in the or stated contract is ascertainable day of matured from the accounts the by mathematical calculation from a stan- balance is ascertained. dard fixed in the or contract from estab- § 1978, (Cum.Supp.1984). NMSA 56-8-3 prices subject lished market mat- Previously, provided ter, this statute an interest is on the allowed amount of percent. 1978, est rate of six NMSA debt money the or from value the time § (Orig.Pamp.). due, 56-8-3 performance was after making all the deductions to which the defendant The facts in are similar those Shaeffer may be entitled. in the instant case. There the defendant buyer breached a construction contract. In This recognized court in Shaeffer Shaeffer, a in which two members of case that under both the common law and panel this we participated, stated be- 1978, 56-8-3, NMSA Section where the cause plaintiff of the debt owed the the amount of under the indebtedness contract defendant, plaintiff was to dis- unable breaching is ascertainable party, the charge a construction loan and: injured party the is entitled to interest aas [plaintiff] been has also forced make right of matter monies at the those * * * In costly payments. addi- rate. tion, he earning has lost the use and § adopting 337(a), In Restatement power $17,000 of of his own funds used when the indicated that amount Shaeffer project. Simple to finance the interest is owed is a “ascertainable mathematical estimating allowed as a means of these calculation from a standard fixed in the probable gains compensation and as from established market prevention. their prices,” applicable. Section is 95 187, 95 N.M. at 619 P.2d at 1231. The 187, (quoting N.M. at 619 P.2d at 1231 court continued that under NMSA Shaeffer § 337(a) from Restatement of 1978, 56-8-3, contractor (1932)). entitled to recover interest as a matter of right by contract, due when even In the Grynberg pro instant case there was in specified no interest rate duced sufficient evidence sustain his 188, contract. Id. at 619 P.2d at proof, Shaeffer, burden under that the sums due under the could quoted approval contracts have we with Shaeffer certainty. been ascertained with reasonable O’Meara v. Commercial Insurance 71 § 56-8-3; Shaeffer; N.M. NMSA see also O’Meara § adopted (Second) allowing the common law in- Restatement 354 terest on c Grynberg’s indebtedness where the amount comment evidence in first, readily cluded, due can be ascertained. the “Authorization For Ex O’Meara interpreted signed penditures” Sec- the defendants for

563 ex- interest could not claimed as agreements stated the While be a well. The each right in express matter of absence of an working interest and percentage of the act law, agreement early at common accord- defendant percentage of costs each ing viewpoint, to the modern there are Secondly, the documents would owe. many circumstances interest can where listed filed with the court so claimed. 45 be Am.Jur.2d Interest numbers, dates, exact amounts due invoice Usury amount due for per invoice and the total defendant. each (Emphasis 96 N.M. at 627 P.2d at 880. original). in Shaeffer, the rule stated Under prejudg The common law rule of receipt showing an invoice ment interest as stated Restatement amount owed is sufficient notice to a rea Contracts Section does not de person of the amount in which he sonable pend on extraneous factors such as wheth Here, in is indebted under his contract. party injured er the borrowed to cover the provided by the in addition to information indebtedness; or whether or not interest voices, the defendants could ascertain their paid money was on borrowed to cover the portion operation of the total costs of the breaching party’s debt. Shaeffer, See percentage “working from their of the in 187, (eventually N.M. at 619 P.2d 1231 real explicitly terest” stated in the “Authoriza izing profit on the a constructed unit is documents, Expenditures” which tion For purposes “not relevant” for the of award in is a standard fixed the contract. There interest). ing prejudgment fore, the debt is “ascertainable mathe calculation a standard matical finding Gryn The trial court’s that from ... interest is in the contract berg [and] did not submit evidence as to dates fixed * * the amount of the debt *.” allowed on paid and amounts borrowed or the interest 187, at 1231 Shaeffer, 95 N.M. at 619 P.2d sums is not of borrowed determinative added); (emphasis (quoting right prejudgment from Restate his interest under the § 337(a) (1932)). as stated Restatement Contracts ment Contracts See of of (Second) See also Restatement Contracts Shaeffer. of § 354 comment c Hillelson, we directed the trial argue Grynberg’s grant prejudgment The defendants that interest from court to (a) liability. reliance the defendant denied his and subsection the date rule, Following the Hillelson the interest misplaced, Section 337 is and that the case payments the dates the here accrued from entirely judicial us falls dis- before within judg were due. A rate of interest on the (b). cretion under subsection Subsection rate, from date the ment at the (b) apply does not to the facts in the instant payable monies until the date the became transcript case. From the it is obvious discharged judgment or the debts were showing made a sufficient to the entered, awarded should have been through trial court invoices and the “Au- following Interest trial court. Expenditures” prove thorization For Shaeffer. payment is likewise judgment until date owing that the amounts were ascertainable § 56-8-4(A) 1978, payable. due and NMSA certainty. with reasonable Restate- See prejudgment (Cum.Supp.1984). The rate of § (Second) ment 354 com- in effect granted is that rate be (1981). Therefore, ment c this is a case pending this a case.” Hil “when became interpre- which comes within the Shaeffer lelson, 96 N.M. at 627 P.2d at 880. The (a) tation of subsection of Section of interest is set stat postjudgment rate prop- prejudgment an award of interest is 1978, 56- percent. ute at fifteen er. 8-4(A) (Cum.Supp.1984). Republic In Hillelson v. Insurance remand this cause of action We 96 N.M. 627 P.2d 878 Chief prejudgment court to award trial appro- Justice Federici commented on the opinion. in accordance with this priateness granting prejudgment IT IS ORDERED est: SO FEDERICI, C.J., RIORDAN and 392 P.2d 675 There is WALTERS, JJ., no abuse of concur. discretion this case. I would affirm the trial court.

STOWERS, J., dissenting. STOWERS, Justice, dissenting.

I dissent.

An award of interest is not

appropriate in this case. IRVINE, Petitioner, James Scott The facts in this case show that defendants did not a pay breach contract to a definite sum of money, or to render a HOSPITAL, INC., ST. JOSEPH Marvin Sachs, Doyle Simmons, M.D., performance value of which is H.J. Mur- rell, M.D., X-Ray Associates, P.A., stated in the is ascertainable Respondents. mathematical calculation from a standard fixed the contract or from prices market No. 15663. subject matter. See Restatement of Supreme Court of New Mexico. § 337(a) (1932). The defendants April 16, 1985. chargeable are not with interest on a sum unless the amount is fixed the contract

or the defendants could have determined the amount with certainty reasonable Steven E. Schonberg, Livingston, Paul proper (Sec- make a tender. Restatement P.C., Schonberg, Steven E. Louis S. Mar- ond) Contracts 354 comment c jon, Albuquerque, petitioner. for agreements The trial court found between Civerolo, Butkus, Richard C. Carl J. Civ- parties agree: and the terms of those erolo, Wolf, P.A., Hansen & Albuquerque, ments based on written estimates of costs respondent for Joseph Hospital. St. expenses, correspondence, verbal Casados, J.E. Kelly, Gallagher Ellen M. understandings, and the actions and con- Casados, P.C., Albuquerque, & for Marvin parties. duct of the The terms of the Sachs. agreements and the amounts due under Lasater, Jr., W. Robert Mark C. Meier- those terms were not prior determinable Dickason, Sloan, ing, Rodey, Robb, Akin & the trial court’s agree- construction of the P.A., Albuquerque, Doyle Simmons, for Thus, ments. the amounts owed Murrell, M.D. and H.J. M.D. defendants were not ascertainable math- Black, Campbell, Black, Bruce D. Byrd & ematical prior judgment calculation P.A., Fe, Associates, X-Ray Santa for Inc. of the trial court. Kennedy See v. Mou- tray, 91 N.M. 572 P.2d 933 ORDER being case, This prejudg- an award of The writ of certiorari heretofore issued ment interest then becomes a matter quashed having this Court is as been trial court’s discretion. See Restatement granted. improvidently only The issue § 337(b); (Sec- Restatement of ond) by petitioner raised in this cause was the 354(2). % The trial court and constitutionality construction properly exercised its discretion re- year three statute of limitations fusing to award interest. See Malpractice Medical Act. NMSA O’Meara v. Commercial Insurance 71 § (Repl.Pamp.1982). Kern v. St . N.M. As we have Joseph Inc., Hospital, times, many said we will not review the (1985),disposed P.2d 135 of this issue. Pe exercise of a trial court’s discretion absent present preserve titioner did not an abuse of Alba, discretion. Edington v. review the issue of fraudulent concealment

Case Details

Case Name: Grynberg v. Roberts

Court Name: New Mexico Supreme Court

Date Published: Apr 16, 1985

Citation: 698 P.2d 430

Docket Number: 15007

Court Abbreviation: N.M.