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- Title
Agreeing to a Post-Judgment Interest Rate.
- Authors
Seidenberg, David
- Abstract
This article examines the court case Westinghouse Credit Corp. v. D'Urso. The US 2nd Circuit held that the parties to an arbitration must expressly agree to a post-judgment interest rate other than the statutory rate. Post-judgment interest starts accruing only after the amount of the judgment is meaningfully ascertained. This case arose from the sale of a chain of supermarkets by Florence D'Urso to a buyer who financed part of the purchase through Westinghouse Credit Corp. The sales contract called for post-closing adjustments and provided that any disputes involving post-closing adjustments should be resolved in arbitration. It also provided that any award must be paid in 10 days and contained an interest provision in the event the award was not paid on the due date. It stated that in that event, interest shall be added to the amount due from the date payment was due to the date payment is made, at the prime rate plus 5 percent. The seller returned some funds to the buyer, but the buyer sought more money as post-closing adjustments. Before the post-closing adjustment dispute was resolved, the buyer defaulted on certain payments owed to the seller and filed for bankruptcy. The bankruptcy court allowed Westinghouse, as the buyer's secured creditor, to assert the buyer's post-closing adjustment claims against the seller. The seller demanded arbitration, and she was successful in this endeavor. In the arbitration, the arbitrator awarded Westinghouse $2.3 million on the post-closing adjustment claim. Meanwhile, the seller had obtained two judgments against the buyer arising out of the supermarket sale and she sought to set off these judgments against the arbitration award, which had been confirmed by the district court on June 2, 1999. The seller appealed and asserted her right to set-off the judgments against the arbitration award. The 2nd Circuit vacated the judgment and held that she could not use those judgments as a set off.
- Subjects
ARBITRATION &; award; COMMERCIAL arbitration agreements; COMMERCIAL law; DISPUTE resolution; WESTINGHOUSE Credit Corp.; INTEREST rates
- Publication
Dispute Resolution Journal, 2004, Vol 59, Issue 3, p106
- ISSN
1074-8105
- Publication type
Article