Missouri Supreme Court clarifies rules for post-judgment interest in tort and nontort cases: Dennis v. Riezman Berger, P.C., SC96038 (Mo. Sept. 26, 2017)

October 4, 2017

Thomas Dennis and Sonya Cherry (“the plaintiffs”) sued Mercy Hospital Jefferson and its collection law firm. The plaintiffs alleged, among other claims, that the hospital improperly and fraudulently attempted to collect post-judgment interest on judgments the hospital secured against each of the plaintiffs for breach of contract.  The underlying breach-of-contract judgments did not expressly award post-judgment interest.  The trial court sustained motions to dismiss filed by the hospital and the collection firm, and the plaintiffs appealed.  After opinion by the court of appeals, the Missouri Supreme Court transferred the case.

 

The Missouri Supreme Court unanimously agreed that the plaintiffs’ petition failed to state a claim based on the hospital’s attempt to collect post-judgment interest.  In an opinion authored by Judge Powell, the Court considered the language of § 408.040, RSMo Cum. Supp. 2013, the statute governing post-judgment interest in both tort and non-tort cases.[1]  Subsection 1 provides that post-judgment interest “shall be allowed” in non-tort actions at the rate of nine percent or at a higher rate specified in the parties’ contract in an action for breach of contract.  While subsection 2 similarly mandates that post-judgment interest “shall be allowed” in tort cases, it also provides that the judgment “shall state” the applicable interest rate.  Based on these provisions, the Court held that post-judgment interest accrues automatically in non-tort actions as a matter of law under  § 408.040.1 regardless of whether the judgment expressly includes it, because subsection 1 does not require the judgment to calculate or expressly state the amount of interest, as is true for tort actions under § 408.040.2.  Although the Court agreed that the plaintiffs failed to state a cause of action based on the hospital’s attempt to collect post-judgment interest, the Court vacated the dismissal of the petition and remanded the case to the trial court with directions to consider the merits of the plaintiffs’ remaining claims.

[1] This statute has since been amended.  The language relevant to the Court’s holding in the case is the same, but the numbering has changed.  See § 408.040, RSMo 2016.