Amert v. Ziebarth Construction Co.

400 N.W.2d 888, 1987 S.D. LEXIS 226
CourtSouth Dakota Supreme Court
DecidedFebruary 11, 1987
Docket15299
StatusPublished
Cited by29 cases

This text of 400 N.W.2d 888 (Amert v. Ziebarth Construction Co.) is published on Counsel Stack Legal Research, covering South Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Amert v. Ziebarth Construction Co., 400 N.W.2d 888, 1987 S.D. LEXIS 226 (S.D. 1987).

Opinions

WUEST, Chief Justice.

Appellant appeals trial court’s judgment denying prejudgment interest. We reverse and remand.

Appellant, Henry Amert (Amert), is the owner of a recreation building in Madison, South Dakota and was a stockholder in Amert Construction Company. Amert Construction Company was the prime contractor on the recreation building. Insulation work on the building was subcontracted to the Ziebarth Construction Company, doing business as Madison Insulation. The insulation was supplied by U.S. Fiber Corporation.

The recreation building, built in conjunction with a twenty-four unit apartment complex, was constructed in the winter of 1978. In the spring of 1979 appellant noticed the outside steel panels of the building had begun to rust. The corrosion was predominant in an area which enclosed the swimming pool. Testing showed the cellulose insulation provided by U.S. Fiber Corporation was highly corrosive. The cellulose fibers reacted with the high humidity created by the swimming pool and caused severe corrosion to the sheet metal in the building. The insulation was not recommended in metal buildings.

The appellant sued Amert Construction Company for breach of implied warranties of fitness for a particular purpose. Amert Construction filed a third-party complaint against Ziebarth Construction, and Zie-[890]*890barth in turn filed a fourth-party complaint against U.S. Fiber on the theories of express warranty and implied warranties of merchantability and fitness for a particular purpose. Appellant’s October 4, 1982 complaint alleged damages of $95,505. A June 7, 1983 amended complaint also alleged damages of $95,505. On November 3, 1983, the court granted appellant’s motion to dismiss the amended complaint against Amert Construction. Third party claims against Amert Construction by Ziebarth and U.S. Fiber were preserved. On October 8, 1985, the appellant filed a second amended complaint which requested $141,-543.00 in damages, but that amount was later changed to $95,505 before the date of trial.

The trial court instructed the jury it could award damages based upon the lesser of either the reasonable expense of making necessary repairs or the difference between the fair market value of the property immediately before and the fair market value of the unrepaired property immediately after discovery of the damage. The jury awarded $95,505, but the trial court denied appellants motion for prejudgment interest. The trial court held that the exact amount of the fair and reasonable cost of necessary repairs to the building was not certain or capable of being made certain by calculation.

South Dakota’s prejudgment interest statute is SDCL 21-1-11. It provides:

Every person who is entitled to recover damages certain, or capable of being made certain by calculation, and the right to recover which is vested in him upon a particular day, is entitled also to recover interest thereon from that day, except during such time as the debtor is prevented by law, or by the act of the creditor, from paying the debt.

The mere fact that a claim is disputed does not defeat the allowance of interest. Barton Masonry, Inc. v. Varilek, 375 N.W.2d 200 (S.D.1985); Dougherty v. Beckman, 347 N.W.2d 587 (S.D.1984); Beka v. Lithium Corporation of America, 77 S.D. 370, 92 N.W.2d 156 (1958); Corcoran v. Halloran, 20 S.D. 384, 107 N.W. 210 (1906). Where the amount sought for recovery even though not liquidated,, is based upon the readily ascertainable value of services or property, the general and better considered rule is to allow interest, at least in the absence of strong equities to the contrary. Aetna Casualty Ins. Co. v. United States, 365 F.2d 997 (8th Cir.1966). Interest is allowable on damages if there exists established or reasonably ascertainable market prices or values on the subject matter by reference to which the amount due may be determined by computation. Barton, supra; Dougherty, supra; Beka, supra; Gearhart v. Hyde, 39 S.D. 273, 164 N.W. 58 (1917). The reason for denying interest on a claim is that when the person liable does not know what sum he owes, he cannot be in default for not paying. However, when the exact sum of the indebtedness is known or can be readily ascertained the reason for denial of interest does not exist. Beka, supra.

There was no dispute over the actual amount of physical damage to the structure. Appellant is entitled to prejudgment interest as long as damages are capable of being made certain by calculation. Appel-lees point out that appellant had several estimates of the cost of repairs. Appellant had an estimate of $36,705 in January of 1982, and in September 1982, the estimate was $95,505. In September 1985, just before trial, damages in the second amended complaint were set at $141,910.09, but there was no itemized estimate of repairs. Ziebarth had its own estimate of $98,000 for a total rebuilding of the structure. Ap-pellees point to these estimates and argue that damages were not capable of ascertainment by computation.

Appellant explains the discrepancy between the January 1982 and September 1982 estimates by claiming only the pool area was surveyed in the January estimate and further damages were not discovered until later. However, it does appear that both estimates included repairs on both the pool area and the rest of the structure as a whole. Moreover, the line items are the [891]*891same in both estimates, and yet there is a large discrepancy in the dollar totals for each line item. In any event, the jury accepted appellants explanation. The second estimate of $95,505 was the one that was submitted to the appellees and it was the figure the jury returned for the appellant.

A party is not entitled to prejudgment interest in cases where the amount of damages remains uncertain until determined by the trial court. Arcon Const. Co. v. S.D. Cement Plant, 349 N.W.2d 407 (S.D.1984); Fullerton Lumber Co. v. Reindl, 331 N.W.2d 293 (S.D.1983); State v. Ed Cox and Son, 81 S.D. 165, 132 N.W.2d 282 (1965). In Arcon, prejudgment interest was denied. In that case the contractor admitted that its own records were not usable for determining actual damages. Averages and estimates were used, but the guidelines used for the plaintiffs estimates were questionable and were vigorously objected to by the cement plant. Here, the damages were based on objective measurement of the labor and materials necessary to restore the building, and the defendants did not dispute the reasonableness of appellant’s $95,505 calculation.

In Fullerton, prejudgment interest was denied. Plaintiff testified he did not keep records of the number of pig deaths due to the leaking roof. He submitted evidence based on a loss of twenty-five, thirty, or thirty-five pigs.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

South Dakota Subsequent Injury Fund v. Homestake Mining Co.
1999 SD 159 (South Dakota Supreme Court, 1999)
State SIF v. Homestake Mining Co.
1999 SD 159 (South Dakota Supreme Court, 1999)
Colton v. Decker
540 N.W.2d 172 (South Dakota Supreme Court, 1995)
Honomichl v. Modlin
477 N.W.2d 599 (South Dakota Supreme Court, 1991)
Clements v. Gabriel
472 N.W.2d 480 (South Dakota Supreme Court, 1991)
Rininger v. Bennett County School District
468 N.W.2d 423 (South Dakota Supreme Court, 1991)
Jensen Ranch, Inc. v. Marsden
440 N.W.2d 762 (South Dakota Supreme Court, 1989)
Heer v. State
432 N.W.2d 559 (South Dakota Supreme Court, 1988)
South Dakota Building Authority v. Geiger-Berger Associates, P.C.
414 N.W.2d 15 (South Dakota Supreme Court, 1987)
Amert v. Continental Casualty Co.
409 N.W.2d 660 (South Dakota Supreme Court, 1987)
Kellogg v. Rowett
408 N.W.2d 334 (South Dakota Supreme Court, 1987)
Arcon Construction Co. v. South Dakota Cement Plant
405 N.W.2d 45 (South Dakota Supreme Court, 1987)
Hageman v. Vander Vorste
403 N.W.2d 420 (South Dakota Supreme Court, 1987)
Amert v. Ziebarth Construction Co.
400 N.W.2d 888 (South Dakota Supreme Court, 1987)

Cite This Page — Counsel Stack

Bluebook (online)
400 N.W.2d 888, 1987 S.D. LEXIS 226, Counsel Stack Legal Research, https://law.counselstack.com/opinion/amert-v-ziebarth-construction-co-sd-1987.