In a recent letter decision, the Court of Chancery in ReCor Medical, Inc. v. Warnking, C.A. endobj endobj New York Article 50 deals with personal injury and wrongful death actions, and provides the circumstances ... statutes seem to be silent on whether interest is compound or simple. v. O'Connell, 295 N.Y. 129, 134, 65 N.E.2d 745; see also, Karger, Powers of the New York Court of Appeals § 17[c], at 80 [3d ed.] <> Interest must be added if we are to make the plaintiff whole. In this breach of contract action, we address whether a creditor is entitled to prejudgment interest under CPLR 5001 where the promissory note provided for monthly interest and principal installment payments on the debt owed. /L 45102 41 0 obj Accordingly, the order of the Appellate Division should be affirmed, with costs. Interest was to accrue at the rate of 8% per annum, payable monthly.
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>> endstream endobj The judgment form seems to imply modified simple interest as it calls for the daily interest. endobj
Noting that the effective annual rate of interest on this note exceeded the maximum rate of interest as fixed in the General Obligations Law, the Court held that the note was usurious and thus “void and uncollectable” (37 N.Y.2d, at 309, 372 N.Y.S.2d 63, 333 N.E.2d 366).
endobj 0000017993 00000 n endobj /ID  0
Compound interest is commonly defined as “interest on interest” or interest that is “paid on both the principal and the previously accumulated interest” (Black's Law Dictionary 817 [7th ed. >> 0000017757 00000 n 0000006151 00000 n 1999] [emphasis added] ). 21 0 obj << 4 The formula assumes that prejudgment interest will be compounded. 3 0 obj uuid:857cdd96-aeb4-11b2-0a00-e01df1010000 This application not only comports with the plain language of the statute that mandates the award of interest to verdict in breach of contract actions (see, e.g., Brushton-Moira Cent. >> Rosalind T. SPODEK, Also Known as Roslyn Spodek, Respondent, v. PARK PROPERTY DEVELOPMENT ASSOCIATES, Appellant. /Pages 10 0 R /N 3 Co., 245 N.Y. 1, 5-6, 156 N.E. 7 0 obj 55 0 obj
After joinder of issue, plaintiff moved for summary judgment, which Supreme Court denied but the Appellate Division subsequently granted (see, 263 A.D.2d 478, 693 N.Y.S.2d 199, lv.
Firefox, or Judgment collection including prejudgment interest and court fees that bear interest or not. 0000000628 00000 n 0000000729 00000 n trailer << << School Dist.
This contrasts with simple interest, which is “paid on the principal only and not on accumulated interest… endobj Furthermore, both decisions predate the enactment of General Obligations Law § 5-527, which now makes certain loans and other agreements providing for compound interest enforceable. /Prev 44706 27 0 obj But the reasons that led the New York courts long ago to condemn agreements for compound interest have only a remote bearing on agreements for simple interest on overdue coupons. Thus, we have no occasion to address the final judgment. * * * If [defendant] chose to keep the money, it should pay for what it kept. /TrimBox [0.0000 0.0000 612.0000 792.0000] 6 0 obj
<> 1 � � There is thus nothing unfair about requiring the defendant to pay over this ‘profit’ in the form of interest to the plaintiff, the party who was entitled to the funds from the date the defendant's liability was fixed.” Plaintiff is, therefore, entitled to recover interest under CPLR 5001(a) on the overdue interest and principal payments from the accrual of her action for breach of contract. <> 36 0 obj /E 32814 This highly sophisticated module offers a unique tool to easily collect judgment awards when prejudgment interest is already computed and/or court fees included in the amount due to the plaintiff. /P 0 This result does not penalize debtors for exercising their right to contest the debt through litigation. 29 0 obj <>1]/P 20 0 R/Pg 48 0 R/S/Link>> <>14]/P 26 0 R/Pg 48 0 R/S/Link>> & Plate Glass Ins. 13 0 obj 43 0 obj 2020-06-24T11:14:53-07:00 Indeed, in an analogous situation in Love v. State of New York, 78 N.Y.2d 540, 545, 577 N.Y.S.2d 359, 583 N.E.2d 1296, we reasoned that a debtor “who has actually had the use of the money, has presumably used the money to its benefit and, consequently, has realized some profit, tangible or otherwise, from having it in hand during the pendency of the litigation. /Filter [/FlateDecode ] We hold that CPLR 5001(a) permits a creditor to recover prejudgment interest on unpaid interest and principal payments awarded from the date each payment became due under the terms of the promissory note to the date liability is established. Upon remand, Supreme Court awarded plaintiff $1,094,083.60, representing interest owed for each month of default from August 1991, together with annual amortized principal payments from April 1992.
%PDF-1.4 32 0 obj <> In holding that plaintiff could not recover compound interest on these facts, the Court set forth two rules: “first, that an agreement to pay interest upon interest must * * * be made after the interest which is to bear interest has become due, and second, that it must be supported by a sufficient consideration” (67 N.Y., at 167-168). << endobj There would be obvious injustice if interest were to be lost as the result of a slight discrepancy between the claim and the award.”.
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