Brown v. Office of the Commissioner of Probation

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14-P-1055 Appeals Court

HELEN BROWN vs. OFFICE OF THE COMMISSIONER OF PROBATION.

No. 14-P-1055.

Suffolk. April 21, 2015. - August 4, 2015.

Present: Green, Fecteau, & Agnes, JJ.

Public Employment. Governmental Immunity. Judgment,

Interest. Damages, Punitive, Interest, Attorney's

fees. Interest. Waiver. Practice, Civil, Interest,

Waiver, Attorney's fees, Costs.

Civil action commenced in the Superior Court Department on

August 13, 2007.

Following review by this court, 84 Mass. App. Ct. 1109

(2013), a motion for postjudgment interest was considered

by Paul E. Troy, J., and judgment was entered by him.

Jonathan J. Margolis (Beth R. Myers with him) for the

plaintiff.

Sally A. VanderWeele, Assistant Attorney General, for the

defendant.

David A. Russcol, for Massachusetts Employment Lawyers

Association, amicus curiae, submitted a brief.

FECTEAU, J. This case presents the novel issue of whether

a plaintiff who recovers punitive damages as part of a judgment

2

under the provisions of G. L. c. 151B, § 9, against a

subdivision of the Commonwealth may be awarded postjudgment

interest on that award and on the award of attorney's fees and

costs, or whether sovereign immunity bars such interest. 1 The

statutes relevant to the issue, including those under which the

punitive damages were awarded, i.e., c. 151B, and G. L. c. 235,

§ 8 (interest on judgments), are silent on the matter. Neither

the Appeals Court nor the Supreme Judicial Court has squarely

addressed the issue in a published opinion with respect to

c. 151B. In Sheriff of Suffolk County v. Jail Officers &

Employees of Suffolk County, 465 Mass. 584, 597-598 (2013), the

Supreme Judicial Court stated, "the general rule is that 'the

Commonwealth . . . is not liable for postjudgment interest in

the absence of a clear statutory waiver of sovereign immunity in

that regard,'" and "entities entitled to sovereign immunity are

1

On February 9, 2011, judgment on the jury verdict in favor

of the plaintiff entered for $6,000 in compensatory damages and

$500,000 in punitive damages, which was later reduced by an

order of partial remittitur, reducing the punitive award to

$108,000 (affirmed after a report to this court, see Brown v.

Office of the Commr. of Probation, 84 Mass. App. Ct. 1109

[2013]). The plaintiff ultimately accepted the remittitur. On

January 18, 2012, attorney's fees were awarded in the amount of

$233,463.48, and costs of $13,294.47. On January 30, 2014, the

trial judge denied the plaintiff's motion for postjudgment

interest on the award of punitive damages, attorney's fees, and

costs, and judgment after rescript was entered accordingly on

March 12, 2014. On July 15, 2014, the Commonwealth paid the

compensatory and punitive damages, attorney's fee and costs, and

prejudgment and postjudgment interest on the compensatory

damages.

3

not liable for interest under G. L. c. 235, § 8, absent an

unequivocal statutory waiver," citing Chapman v. University of

Mass. Med. Center, 423 Mass. 584, 586 (1996). Thus, we must

discern whether this case presents an exception to the general

rule.

In Todino v. Wellfleet, 448 Mass. 234, 238 (2007) (Todino),

the court generally observed that "[m]unicipal liability

implicates the doctrine of sovereign immunity, which protects

the public treasury from unanticipated money judgments.

Sovereign immunity prohibits liability against the Commonwealth

[and] . . . its instrumentalities . . . except with [the

Commonwealth's] consent, and, when that consent is granted . . .

only in the manner and to the extent expressed . . . [by]

statute" (citation and quotation omitted). The court also noted

that "[t]he rules of construction governing statutory waivers of

sovereign immunity are stringent." Ibid. (quotation omitted).

However, it allowed that "even a strict interpretation must be

reasonable, and our focus remains on the intent of the

Legislature. If sovereign immunity is not waived expressly by

statute, we consider whether governmental liability is necessary

to effectuate the legislative purpose." Ibid. (citations

omitted). See DeRoche v. Massachusetts Commn. Against

Discrimination, 447 Mass. 1, 12-13 (2006) (DeRoche). Thus, the

issue presented in this case reduces to whether sovereign

4

immunity has been waived by necessary implication in regard to

postjudgment interest on punitive damages, costs, and attorney's

fees in an award against the Commonwealth or its entities under

c. 151B.

The Commonwealth contends that sovereign immunity has not

been waived for this type of postjudgment interest. 2 It urges

that there is a substantial and practical reason that justifies

treatment of the Commonwealth differently from private

employers. While it recognizes that G. L. c. 151B, § 1(1) and

(5), includes the Commonwealth in the statutory definition of

"persons" and "employers" subject to c. 151B, and that generally

the Legislature intended for the Commonwealth to be treated the

same as private employers under most of the statutes and rules

applicable in c. 151B proceedings, it argues that postjudgment

interest on punitive damages is fundamentally different in kind

from any other type of award or benefit. This is true if only

because the amount of punitive damages is neither foreseeable

2

In Salvi v. Suffolk County Sheriff's Dept., 67 Mass. App.

Ct. 596, 608 (2006), this court cited DeRoche, supra, for the

proposition that "[i]t is now settled law that sovereign

immunity is no bar to the liability of a public sector employer

for prejudgment interest on damages in a G. L. c. 151B

discrimination case." See Trustees of Health & Hosps. of

Boston, Inc. v. Massachusetts Commn. Against Discrimination, 65

Mass. App. Ct. 329, 338 (2005), S.C., 449 Mass. 675 (2007)

(concluding that Commonwealth is subject to prejudgment interest

because Commonwealth and its subdivisions are listed under

statutory definition of persons and employers subject to

c. 151B, and because prejudgment interest is remedy authorized

under c. 151B).

5

nor readily available for payment given the system of balanced

budgeting and that State departments and agencies must depend on

legislative appropriation for their funding, thus requiring time

to obtain funds necessary to pay such awards. Indeed, as noted

in M. O'Connor Contr., Inc. v. Brockton, 61 Mass. App. Ct. 278,

285 n.12 (2004), "[p]unitive damages, by definition, are not

intended to compensate the injured party, but rather to punish

and deter the wrongdoer; yet an award of punitive damages

against a municipality punishes only the taxpayers, who took no

part in the wrongful conduct, but who nevertheless may incur an

increase in taxes or a reduction in public services as a result

of the award. See Newport v. Fact Concerts, Inc., 453 U.S.

[247,] 266-267 [1981]." Thus, the underlying reasoning for

postjudgment interest on awards under c. 151B -- to encourage

prompt payment by employers -- ought not apply to the

Commonwealth. 3

The plaintiff relies on DeRoche, supra at 3, where the

Supreme Judicial Court reviewed a judgment of the Superior Court

3

Private employers are subject to postjudgment interest on

punitive damages and attorney's fees in c. 151B cases. See

Nardone v. Patrick Motor Sales, Inc., 46 Mass. App. Ct. 452,

453-454 (1999). In Bain v. Springfield, 424 Mass. 758, 762-763

(1997), the court held that the Commonwealth is subject to

punitive damages under c. 151B, reasoning that because the

Legislature explicitly deemed the Commonwealth a person or

employer subject to c. 151B, and because c. 151B, § 9, provides

for the award of actual and punitive damages, the Commonwealth,

like private employers, is equally subject to punitive damages.

6

affirming an award entered by the Massachusetts Commission

Against Discrimination (MCAD) on a complaint brought under G. L.

c. 151B, § 5, against a public entity. The MCAD found for the

plaintiff and awarded compensatory damages but did not assess

interest on the damages. Ibid. The Superior Court, in

affirming the award, ordered prejudgment and postjudgment

interest. See id. at 6. The Supreme Judicial Court, noting

that c. 151B, and G. L. c. 258, § 1 ("the primary statutory

basis for the waiver of sovereign immunity"), are silent on

whether interest may be assessed on awards under c. 151B against

the Commonwealth, held that for certain provisions of c. 151B,

sovereign immunity of the Commonwealth had been waived for

interest purposes "by necessary implication." Id. at 12-14

(quotation omitted). The court reached its decision on two

grounds.

First, because the Commonwealth is explicitly included as a

"person" or "employer" subject to suit under c. 151B, and

because the MCAD has the power to impose prejudgment interest on

private employers in the c. 151B context, the "inevitable

conclusion" is that the Legislature must have intended for the

Commonwealth to also be subject to interest. Id. at 13.

Second, the court reasoned, c. 151B, § 5 (regarding

proceedings before the MCAD and the MCAD's powers), gives the

MCAD broad discretion to order a full range of remedies to

7

eradicate discrimination, therefore also supporting the

conclusion that the Legislature intended to allow the MCAD to

impose interest on awards entered against the Commonwealth. Id.

at 13-14. The court affirmed the judgment of the Superior Court

allowing prejudgment and postjudgment interest to be assessed

against the Commonwealth. See ibid. The plaintiff here avers,

relying on the same reasoning as in DeRoche, that because

c. 151B explicitly puts the Commonwealth in the same class as

private employers, remedies that can be imposed against a

private employer can be imposed against the Commonwealth. The

plaintiff contends that it is a logical extension of the

reasoning in DeRoche to conclude that, because private employers

are subject to postjudgment interest on those types of awards,

so must the Commonwealth, by necessary implication of

legislative intent.

However, there are three limitations to the reach

of DeRoche, supra, that we consider significant. First, while

we recognize the court addressed postjudgment interest, id. at

19 n.19 (note 19), 4 the MCAD had not raised as an issue whether

postjudgment interest should be treated differently from the

4

"The [MCAD] has presented no independent argument as to

why, if sovereign immunity has been waived in connection with

prejudgment interest, that part of the judgment allowing

postjudgment interest should not be affirmed. What has been

said with respect to sovereign immunity thus applies to both

prejudgment and postjudgment interest, for purposes of this

opinion." DeRoche, supra at 19 n.19.

8

prejudgment interest portion of the judgment. See note 19. The

case was primarily focused on prejudgment interest, see id. at

13-14, and as such, although the court allowed postjudgment

interest to stand, that portion of the judgment had not been

challenged, and thus served only as a historical artifact not

essential to the court's analysis. Second, the substantive

award consisted only of compensatory damages; no punitive

damages were awarded. Therefore, the court had no need to

address whether postjudgment interest may be allowable on a

punitive damages award. Third, one of the bases for the court's

holding, as mentioned above, was the broad discretion the

Legislature afforded to the MCAD under c. 151B, § 5, whereas the

case at bar involves a Superior Court trial and jury verdict

awarding punitive damages under c. 151B, § 9. While civil

penalties may now be imposed by the MCAD, see G. L. c. 151B,

§ 5, as amended in 2003, 5 such penalties are limited in amount,

not as broad as penalties available after a trial, and

"staircased" depending on prior violations. See G. L. c. 151B,

§ 5, fourth par.

Furthermore, while there is a logical thread in our cases

discerning a legislative intent, either expressed or implied, to

permit interest on compensatory awards so that employees do not

suffer a loss in value, due to the passage of time, of their

5

See St. 2003, c. 26, § 438.

9

earnings awarded as damages, there is reason to interpret the

case law to limit such interest to compensatory awards only.

Compare, e.g., Perkins Sch. for the Blind v. Rate Setting

Commn., 383 Mass. 825, 835 (1981) ("Interest is awarded by law

so that a person wrongfully deprived of the use of money should

be made whole for [her] loss"); Todino, 448 Mass. at 239

(discussing interest on award under provisions of G. L. c. 41,

§ 111F, court stated that "considering the time value of the

dollar, the only way in which a[n] . . . award will retain its

stated worth is by adding interest in order to compensate for

delay in payment from that point forward") (quotation omitted),

with Onofrio v. Department of Mental Health, 411 Mass. 657, 659-

660 (1992) (noting that "the fact that the Legislature provided

for the recovery of damages from the Commonwealth in G. L.

c. 258 does not lead necessarily to the conclusion that the

statute allows for the recovery of costs as well, because costs

are an ancillary matter to the underlying concern of liability

for damages. Postjudgment interest, similarly, is not an

element of damages. Rather, postjudgment interest serves to

compensate the plaintiff for loss of the use of money when

damages are not paid on time") (quotation and citation omitted).

In our view, the considerations that apply to the loss of use of

money awarded to compensate for lost earnings are significantly

different from those involving a delay in receiving a punitive

10

damage award which is not designed to compensate but rather to

punish.

Indeed, the court in DeRoche reiterated that it had drawn a

line and denied interest for awards of front pay:

"We also have spoken clearly on the issue of the interest

on front pay awards in discrimination cases. In Conway v.

Electro Switch Corp., [402 Mass. 385, 390 (1988)], we

stated that there was 'no justification for adding interest

to damages which, by definition, are for losses to be

incurred in the future.' We decline to revisit this

issue. While the plaintiff is entitled to prejudgment

interest on the back pay damage award, he is not entitled

to prejudgment interest on the front pay award."

DeRoche, 447 Mass. at 15. Similarly, we conclude that such

intent can be discerned with respect to punitive damages, since

their purpose is not to compensate for lost pay, but rather to

penalize for wrongdoing.

While not on all fours, we find support in Gurley

v. Commonwealth, 363 Mass. 595, 599-600 (1973), in which the

court failed to discern by necessary implication a waiver of

sovereign immunity for interest on awards for victims of violent

crimes under the provisions of G. L. c. 258A in effect at the

time. 6 See Todino, 448 Mass. at 241 (noting that court in Gurley

held that "because . . . the payment [under the statute is]

essentially a gift, no award of interest would be necessary or

reasonable").

6

General Laws c. 258A was repealed and replaced by G. L.

c. 258C in 1993. See St. 1993, c. 478, §§ 3, 6; Todino, 448

Mass. at 241 n.9.

11

Consequently, for the foregoing reasons, we fail to be

persuaded by the plaintiff that sovereign immunity has been

waived, by necessary implication, for postjudgment interest on

awards of punitive damages, attorney's fees, and costs.

Judgment after rescript

affirmed.

GREEN, J. (dissenting). In my view, the present case

warrants a straightforward application of the rationale and

conclusion of the Supreme Judicial Court in DeRoche

v. Massachusetts Commn. Against Discrimination, 447 Mass. 1, 14

(2006). In that case, as the majority acknowledges, the Supreme

Judicial Court concluded that the waiver of sovereign immunity

effected by the inclusion of political subdivisions of the

Commonwealth within the statutory definitions of persons and

employers set forth in G. L. c. 151B, § 1(1) and (5), means that

public employers are subject to prejudgment interest on any

award of compensatory damages. By resting its conclusion on the

statutory definitions of persons and employers, the court's

rationale essentially placed the Commonwealth (and its political

subdivisions) on the same footing as a private employer. Ibid.

The purpose of postjudgment interest is to preserve the

value of a damage award until the time it is paid. It is

settled that postjudgment interest will be imposed on awards of

punitive damages against a private employer. 1 See Nardone

v. Patrick Motor Sales, Inc., 46 Mass. App. Ct. 452, 454 (1999).

It is also settled that public employers are subject to punitive

damages. See Bain v. Springfield, 424 Mass. 758, 762-764

1

For that reason, the majority's attempt to distinguish

actual and punitive damages based on a contrast between the

compensatory nature of the former and the punitive nature of the

latter is inapt.

2

(1997). Under the rationale adopted by the court in DeRoche,

then, the inclusion of public employers within the statutory

definitions of persons and employers for purposes of G. L.

c. 151B subjects public employers to postjudgment interest on

both compensatory and punitive damages, just as it does private

employers. 2

Because I believe DeRoche and Bain, considered together,

entitle the plaintiff to postjudgment interest on the punitive

damages awarded to her, I respectfully dissent.

2

As the majority also acknowledges, the court in DeRoche,

supra at 19 n.19, also affirmed the assessment of postjudgment

interest on the damage award in that case. Though the question

of postjudgment interest (as distinct from prejudgment interest)

appears not to have been contested in DeRoche, the distinction

is without a difference in terms of the rationale on which the

court rested its conclusion. Accordingly, even if the court's

affirmance of the judgment concerning postjudgment interest in

DeRoche is considered dictum, the principles on which the

court's holding was based dictate that postjudgment interest be

treated the same.