Delaware River Tow, LLC v. Nelson

382 F. Supp. 2d 710, 2005 U.S. Dist. LEXIS 10857, 2005 WL 1324882
CourtDistrict Court, E.D. Pennsylvania
DecidedJune 3, 2005
Docket04-2850
StatusPublished
Cited by2 cases

This text of 382 F. Supp. 2d 710 (Delaware River Tow, LLC v. Nelson) is published on Counsel Stack Legal Research, covering District Court, E.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Delaware River Tow, LLC v. Nelson, 382 F. Supp. 2d 710, 2005 U.S. Dist. LEXIS 10857, 2005 WL 1324882 (E.D. Pa. 2005).

Opinion

MEMORANDUM

ROBRENO, District Judge.

This action arises out of a salvage contract and comes to the Court under 28 U.S.C. § 1333, which grants federal district courts exclusive jurisdiction in any “civil case of admiralty or maritime juris *712 diction.” On February 7, 2005, the Court held a bench trial. The Court’s findings of fact and conclusions of law concerning the case are detailed in a Memorandum dated February 10, 2005 (doc. no. 29), which is available at 2005 WL 331706 or 2005 U.S. Dist. LEXIS 2071. Also on February 10, 2005, the Court issued two Orders: (1) an Order directing that judgment as to liability only be entered in favor of plaintiff, Delaware Tow, LLC and against defendant Vernell Nelson, who had defaulted (doc. no. 28), and (2) an Order directing that judgment be entered in favor of plaintiff and against defendant Allstate in the amount of $4,654.50 (doc. no. 29).

On February 25, 2005, the Court held a hearing to consider whether to modify the $4,654.50 judgment against Allstate to include an award to plaintiff of interest, costs, and attorneys’ fees. The Court was also to determine the amount of Vernell Nelson’s liability. At the hearing, however, two circumstances hindered the Court’s resolution of these issues: Counsel were not adequately prepared for the hearing, and Vernell Nelson appeared in the action for the first time. In light of these circumstances, the Court continued the hearing and gave each party an opportunity to file a brief in support of any post-trial relief it requested.

On May 10, 2005, the Court resumed the February 25, 2005 hearing to permit the parties to orally argue their respective motions. This Memorandum sets forth the Court’s rulings on the issues presented at the May 10, 2005 hearing. Before the Court are the three outstanding issues:

1. Should the judgment of $4,654.50 entered against Defendant Allstate (representing the contract price of salvaging the yacht) be amended to provide for interest, costs, and attorneys’ fees?
2. Should the judgment by default as to liability in favor of plaintiff and against Defendant Vernell Nelson (proceeding pro se) be set aside, and if not, what is the appropriate measure of damages against Vernell Nelson?
3. Should the Court enter a default judgment in favor of Allstate and against Nelson on Allstate’s cross-claim against Nelson?

These issues will be addressed in turn.

I. Plaintiff v. Allstate — Interest, Costs and Attorneys’ Fees

A. Interest

The general rule in admiralty is that a prevailing party may recover prejudgment interest except where equitable considerations make the award unconscionable. Inland Tugs Co. v. Ohio River Co., 709 F.2d 1065, 1074-75 (6th Cir.1983). Furthermore, “[p]re-judgment interest in Pennsylvania contract cases is a matter of right and is calculated from the time the money becomes due or payable.” Am. Enka Co. v. Wicaco Mach. Corp., 686 F.2d 1050, 1056 (3d Cir.1982) (citing Penneys v. Pa. R.R. Co., 408 Pa. 276, 183 A.2d 544 (1962)). 1 As to the rate of interest, “the party to whom the sum is owed may as a matter of right recover prejudgment interest at the legal rate of six percent [per *713 annum] running from the date the sum is due.” Pollice v. Nat'l Tax Funding, L.P., 225 F.3d 379, 395 (3d Cir.2000) (citing Am. Enka Co., 686 F.2d at 1056-57); see also 41 Pa. Cons.Stat. Ann. § 202 (setting legal rate of interest at six percent per annum). Plaintiff seeks interest on the $4,654.50 judgment, accruing from the date of salvage (February 9, 2004) to the date of judgment (February 10, 2005), or approximately one year: $4,654.50 * 6% = $279.27. As the prevailing party, plaintiff is entitled to this amount, and no equitable considerations counsel against awarding it to plaintiff. Indeed, Defendant Allstate does not object to an award of pre-judgment interest to plaintiff. Accordingly, the judgment of $4,654.50 in favor of plaintiff and against Defendant Allstate will be modified to include an award of $279.27 in interest.

B. Costs

The federal statute governing costs in admiralty cases provides:

Except as otherwise provided by Act of Congress, the allowance and taxation of costs in admiralty and maritime cases shall be prescribed by rules promulgated by the Supreme Court.

28 U.S.C. § 1125. Although the Supreme Court has not exercised its power to promulgate rules specifically addressing the allocation of costs in admiralty cases, it has promulgated Federal Rule of Civil Procedure 54. Rule 54 applies here and permits an award of costs to a prevailing party:

Except when express provision therefor is made either in a statute of the United States or in these rules, costs other than attorneys’ fees shall be allowed as of course to the prevailing party unless the court otherwise directs....

Fed.R.Civ.P. 54(d)(1). 2 The Third Circuit has clarified that the costs a district court may award a prevailing party under Rule 54(d) are limited to the “taxable costs” enumerated in 28 U.S.C. § 1920, the taxable costs statute:

Rule 54(d) provides a standard to be applied by the district courts in awarding what are commonly referred to as taxable costs. Those taxable costs are listed in 28 U.S.C. § 1920. They do not include such litigation expenses as attorneys’ fees and expert witness fees in excess of the standard daily witness fee. Rule 54(d) requires that such taxable costs be awarded to the prevailing party unless the court finds and articulates a reason why that party does not deserve such an award.

Friedman v. Ganassi, 853 F.2d 207, 209 (3d Cir.1988).

The taxable costs statute lists six categories of litigation costs that a court (or the clerk of a court) may award:

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Bluebook (online)
382 F. Supp. 2d 710, 2005 U.S. Dist. LEXIS 10857, 2005 WL 1324882, Counsel Stack Legal Research, https://law.counselstack.com/opinion/delaware-river-tow-llc-v-nelson-paed-2005.