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Heavy Haul, Inc. v. Trail King Industries, Inc - 4/20/2010

Arizona Court Of Appeals Division One Holds That Damages Are Liquidated, and That a Plaintiff Is Thus Entitled to Prejudgment Interest, Where the Amount of Damages Is Certain, or Capable of Straightforward Calculation, Even if a Defendant Argues Comparative Negligence.


Precision Heavy Haul, Inc. (“Precision”) filed suit against Trail King Industries, Inc. (“Trail King”), alleging that a trailer manufactured and sold by Trail King to Precision was negligently designed and manufactured, and that this negligence caused the trailer to fail while transporting cargo and also caused damage to the cargo. Trail King alleged that Precision’s comparative negligence barred recovery. The jury found that Trail King was 100 percent at fault, and awarded the full measure of damages sought by Precision. Precision requested that the superior court award prejudgment interest, but the court refused. In Arizona, a party with a liquidated claim is entitled to prejudgment interest, and the trial court reasoned that because Trial King had raised comparative fault as a defense, Precision’s claim was unliquidated, and Precision was thus not entitled to prejudgment interest. Precision appealed the court’s denial of prejudgment interest.

The Arizona Appeals Court reversed and remanded, rejecting Trail King’s argument that a claim is not liquidated whenever a jury must exercise its discretion to apportion fault. The Court held that uncertainty about a defendant’s liability does not preclude an award of prejudgment interest. Even though the extent of Precision’s liability was in dispute, the amount of its damages was uncontroverted, and since the jury found that Trail King was completely at fault and awarded the full amount of Precision’s alleged damages, the only way to make Precision whole would be to award prejudgment interest. The Court held that where the amount of damages are certain or “capable of straightforward calculation,” then the damages are liquidated.

Judge Weisberg authored the opinion; Judges Norris and Gemmill concurred.

Posted By: James K. Rogers

Posted On: 4/27/2010