Damages – Court awards pre-judgment interest following parties’ acquiescence

Although the plaintiff mistakenly thought the court could award pre-judgment interest following the jury’s damages award without a formal stipulation designating the court as the factfinder on that issue, because this misapprehension was shared by the defendant, who did not object to the court making this finding, the court awarded pre-judgment interest.

Background

The court previously denied plaintiff ZP No. 332, LLC’s request to award pre-judgment interest on top of the jury’s damages verdict because plaintiff failed to prove that the parties stipulated to designate the court as the factfinder on that issue. Plaintiff now asks the court to reconsider that decision.

Analysis

Plaintiff’s counsel, Watterson, describes an exchange in which plaintiff explained that it drafted the proposed special verdict form to enable the court to find facts with respect to pre-judgment interest. Plaintiff never claims—in the Watterson declaration or elsewhere—that it ever proposed a stipulation, described the verdict form as such, or even mentioned to defendant the idea of changing the default factfinder on pre-judgment interest.

If plaintiff had always intended the advisory language following Question Two to be a stipulation, plaintiff could have provided evidence about the discussion in which the stipulation was reached. Without that evidence, the court must conclude that the parties never had such a discussion.

But Watterson nevertheless believed, at the time of the conversation about the draft verdict form, that “the Court [w]ould decide all issues relating to pre[-]judgment interest other than the date of the breach.” From this apparent inconsistency the court concludes that plaintiff had a misconception about the law related to pre-judgment interest: It must have thought the court was the default finder of fact.

This is the only explanation that accounts for the advisory language in the verdict form and the fact that no one ever seems to have discussed the ‘stipulation’ required under Rule 39(a). It also explains all the indications, discussed in the court’s opinion and order on the motion for entry of judgment, that the parties did not intend the language on the verdict form to function as a stipulation within the meaning of Rule 39(a). It is now clear to the court that plaintiff believed no stipulation was required.

But it is also clear that defendant had the same misapprehension. When presented with plaintiff’s proposed verdict form, defendant’s attorney “did not edit or make any comment on the instructive language following Question 2.” And once Watterson explained the purported purpose of Question Three, defendant’s attorney agreed “without discussion, comment, or objection.”

Based on this evidence, the court remains convinced that the parties did not mean to “file a stipulation to a nonjury trial” on pre-judgment interest “or so stipulate on the record.” Instead it appears that, until defendant discovered this requirement and presented it to plaintiff in the opposition brief on the motion for entry of judgment, neither party believed a stipulation was needed.

This puts the court in a difficult position. On one hand, the court is reluctant to find that a stipulation can arise from a mutual belief that no stipulation is required. However, it would be equally strange to ignore the parties’ mutual understanding about who would determine pre-judgment interest—especially when the jury nevertheless did find facts that could form the basis for such an award. To resolve this dilemma, the court concludes it is possible to enter a stipulation to change the factfinder from jury to judge without realizing that such a stipulation is required, if the parties state on the record that they agree who the factfinder will be.

After considering all the evidence now in the record, the court concludes that the parties agreed, at the time they submitted the proposed special verdict form, that the court would determine all issues related to pre-judgment besides the date of defendant’s breach. That constituted a stipulation within the meaning of Rule 39(a).

Interest

Based upon the evidence presented at trial and the supplemental declaration of plaintiff’s damages expert, the court concludes that the jury’s verdict of $9,137,159.00 included $5,395,404.37 in lost profits and $3,741,753.63 in other damages. The court calculates pre-judgment interest on the first sum by tallying profits monthly from December 2022 (the month of the breach through April 2025 (the last month plaintiff asserts it lost profits) and applying a six percent yearly interest rate, compounded annually, to the running total.

Pre-judgment interest on the remaining damages is also calculated at six percent per year, compounded annually. Therefore, the end date for both calculations is the date of the jury’s verdict: Dec. 15, 2025. This results in a pre-judgment interest award of $1,353,790.13.

Plaintiff’s motion to alter judgment granted.

ZP No. 332, LLC v. Huffman Contractors, Inc., Case No. 2:24-cv-611, June 15, 2026. EDVA at Norfolk (Walker). VLW 026-3-260. 14 pp.

Full-Text Opinion
VLW 026-3-260