C & H NATIONWIDE, INC. v. Thompson

HECHT, Justice,

joined by GONZALEZ, CORNYN and ENOCH, Justices, concurring and dissenting.

My prior opinion is withdrawn and the following substituted.

I join in the Court’s analysis of the Comparative Responsibility Law, but I do not agree that prejudgment interest should be awarded on future damages. Accordingly, I concur in Parts I, II, III and Y of the Court’s opinion, but dissent from Part IV.

At trial plaintiffs claimed damages which they had suffered in the past as well as those which they were reasonably likely to suffer in the future. There was evidence of both past and future damages, and the jury was asked to consider both in its findings. The jury was not asked to, and did not, segregate past from future damages. Four of the jury’s findings — plaintiffs’ pecuniary loss, loss of companionship and society, mental, anguish, and loss of inheritance — may therefore have included both past and future damages together. The only damages incurred entirely in the past were Thompson’s own pain and suffering prior to his death on the day of the accident, and his funeral expenses.

The trial court awarded prejudgment interest on all damages, not just past damages. Plaintiffs contend that prejudgment interest on future damages is authorized by TexRev. Civ.Stat.Ann. art. 5069-1.05, § 6(a) (Vernon Supp.1994), which calls for prejudgment interest to accrue “on the amount of the judgment”. Because judgments include all damages awarded, whether past or future, and the statute does not differentiate between the two, plaintiffs argue, and the court of appeals held, that the statute authorizes interest on both. The court of appeals adhered to this view in a later case, Hughes v. Thrash, 832 S.W.2d 779, 787 (Tex.App.—Houston [1st Dist.] 1992, no writ). Four other courts of appeals have adopted the same construction of section 6(a). Wal-Mart Stores, Inc. v. Berry, 833 S.W.2d 587, 596-97 (Tex.App.—Texarkana 1992, writ denied); Sisters of Charity v. Dunsmoor, 832 S.W.2d 112, 115-16 (Tex.App.—Austin 1992, writ denied); Ellis County State Bank v. Keever, 870 S.W.2d 63 (Tex.App.—Dallas 1992), aff'd in part and rev’d in part, 888 S.W.2d 790 (Tex.1994); C.T.W. v. B.C.G., 809 S.W.2d 788, 795 (Tex.App.—Beaumont 1991, no writ). See also John T. Montford & Will G. Barber, 1987 Texas Tort Reform: The Quest for a Fairer and More Predictable Texas Civil Justice System (pt. 1), 25 Hous.L.Rev. 59, 102-03 (1988); 3 State Bar of Texas, Texas Pattern Jury Charges PJC 81.02 Cmt. (1990).

Two principal arguments are offered in support of this construction of the statute. One is that this construction has been endorsed by the Senate sponsor of the statute in a law review article published since the statute was enacted. Montford & Barber, supra. While the perspectives of individual legislators on the meaning of statutes may be instructive, they do not govern the construction of the statute. We are obliged to effectuate the intent of the Legislature and not merely that of some of its members. It is not unusual for intentions concerning particular legislation to vary among its supporters. We must assume that the Legislature has done its very best to express its intent in the words of the statute itself. Even when those words leave us in such doubt as to the Legislature’s purpose that we must look beyond the provision for assistance, it is ordinarily inappropriate to consider the views of individual legislators. See, e.g., Commissioners’ *329 Court of El Paso County v. El Paso County Sheriff's Deputies Ass’n, 620 S.W.2d 900, 902 (Tex.Civ.App.—El Paso 1981, writ ref'd n.r.e.). Moreover, courts construing statutory language should give little weight to post-enactment statements by legislators. See, e.g., Regional Rail Reorganization Act Cases, 419 U.S. 102, 132 , 95 S.Ct. 335, 352-53 , 42 L.Ed.2d 320 (1974); National Woodwork Mfrs. Ass’n v. NLRB, 386 U.S. 612 , 639 n. 34, 87 S.Ct. 1250 , 1265 n. 34, 18 L.Ed.2d 357 (1967); American Fed’n of Gov’t Employees Locals 225, 1504 & 3723 v. Federal Labor Relations Auth., 712 F.2d 640 , 647 n. 29 (D.C.Cir.1983). Explanations produced, after the fact, by individual legislators are not statutory history, and can provide little guidance as to what the legislature collectively intended. See Rogers v. Frito-Lay, Inc., 611 F.2d 1074, 1080 (5th Cir.) (what happened after a statute was enacted may be history and it may come from members of the Congress, but it is not part of the legislative history of the original enactment), cert, denied, 449 U.S. 889 , 101 S.Ct. 246 , 66 L.Ed.2d 115 (1980).

My sense is that the Court relies heavily upon Senator Montford’s view of the statute, although it never squarely says so. Had Senator Montford espoused the opposite view, I doubt very seriously whether the Court would take the same position it does today. As the Court concedes, awarding interest on money not yet owed is not logical, linguistically or legally. All things being equal, I would hope that the Court would presume legislators to be more logical rather than less. But all things are not equal here, and that is principally because Senator Mont-ford has indicated that participants in the drafting of the statute intended for interest to be paid on future damages. Senator Montford certainly occupied a singular role in the drafting and passage of the legislation before us. Yet it is not his intent which controls construction of the statute, but the intent of the entire Legislature. The purposes of a few Members cannot be imputed to the Legislature. That Body binds by what it says, in the English language. If the Court were as willing in every case as it is in this one to construe a statute to mean what some of its sponsors hoped it would, rather than what a person of common sense would think from reading it, it would have adopted a bad rule indeed. As it is, I suspect that the Court’s attitude today will not be applied in other eases consistently.

The other argument made in support of plaintiffs’ construction of section 6(a) is that it is dictated by a literal reading of the statutory language. In actuality, however, this construction of the statute reads only the phrase “on the judgment” literally; it does not read the word “interest” literally. Interest is not merely a right to some unspecified type of compensation. While “interest” may sometimes be considered “damages” and sometimes as purely “interest”, in both contexts, “interest” serves to compensate for the loss of use of money. The Legislature has defined interest as “the compensation allowed by law for the use or forbearance or detention of money”. Tex Rev. Civ.Stat. Ann. art. 5069-1.01(a) (Vernon 1987). In Cavnar v. Quality Control Parking, Inc., 696 S.W.2d 549, 552 (Tex.1985), this Court wrote:

Interest as interest is compensation allowed by law or fixed by the parties for the use or detention of money. Interest as damages is compensation allowed by law as additional damages for lost use of the money due as damages during the lapse of time between the accrual of the claim and the date of the judgment.

Id. (citations omitted).

Even if the Legislature were to decide that there should be some compensation awarded for not paying an amount which is not yet due — a fairly strange supposition in itself— that compensation could not be called “interest”, if we are to be true to the literal meaning of the word, any more than it could be called “alimony”. One might as well call such a surcharge on future damages prejudgment alimony as prejudgment interest; both would be non sequiturs. To read “on the judgment” as literally as plaintiffs do, one cannot read “interest” literally at all.

In a model of understatement, the Court concedes that “permitting the award of ‘interest’ on future damages does sacrifice a certain purity of meaning”. Ante at 324. “Crucifies language” might not be too over *330 stated. The sole justification the Court offers for its “sacrifice” is that the statute suspends accrual of prejudgment interest while a settlement offer is outstanding, thus indicating that it is concerned not only with fair compensation but with settlement incentives. Here the Court’s analysis falters. This argument, even if valid, does not suggest, let alone prove, that the Legislature’s concerns with settlement in one part of the statute carried over to other parts. In essence, the Court argues that since the Legislature was sometimes concerned with settlement incentives, it always was, regardless of the language used. The fallacy of this argument is obvious.

It is true that the Legislature could have both misused the word “interest” and even had a reason for doing so. Absent some rather plain indication of such strange behavior, however, the Court’s reading of the statute is not very plausible. I should think there would be very few lawyers, and even fewer non-lawyers, who would not be startled by the idea that interest can accrue on money that has never been advanced and is not yet due.

Plaintiffs’ and the Court’s construction of section 6(a) also carries unique consequences. Besides past and future damages, judgments may include costs and attorney fees, including attorney fees in the event appeals are taken. In plaintiffs’ view, section 6(a) would impose prejudgment interest on attorney fees that might never even be incurred. Judgments also include prejudgment interest. If “on the judgment” requires awarding prejudgment interest on every amount included in a judgment, prejudgment interest must be awarded on the prejudgment interest included in the judgment. It is implausible the Legislature intended section 6(a) to operate in this fashion. 1

To award “interest” — if that is what we were required to call a surcharge on all damages awarded in a judgment — on future damages would overcompensate plaintiffs. In this case, the jury was asked a standard damages question: “What sum of money, if paid now in cash, would fairly and reasonably compensate [plaintiff] for her damages, if any ... ?” In determining an amount for future damages, the jury was asked for the present value of those damages, that is, the amount which, if paid immediately in cash, would equal the amounts of damages as incurred in the future. Plaintiffs’ evidence attempted to establish the present value of the future damages they claimed. To add prejudgment “interest” to the figure awards more than the damages actually suffered. As we explained in Cavnar :

A problem of overcompensation arises if the plaintiff can collect prejudgment interest on future damages discounted to present value as of the date of trial. If the trier of fact discounts future damages to the date of the incident, then an interest factor should be used to convert the damages from a date-of-incident value to a date-of-trial value. A more direct way to achieve the same result is to discount future damages only to the date of trial. No interest factor is then necessary for the future damages since the present value calculation expresses those damages in date-of-trial dollars. It thus becomes apparent that prejudgment interest on future damages evaluated as of the trial date would result in overcompensation to the plaintiff.

696 S.W.2d at 555 n. 5. See also Yowell v. Piper Aircraft Corp., 703 S.W.2d 630, 636 (Tex.1986) (“Prejudgment interest is not recoverable for unaccrued damages such as loss of inheritance.”). It is possible, of course, that the Legislature simply rejected Cavnar’s conclusions and decided to overcompensate plaintiffs. Assuming that the Legislature could provide for such overcompensation as a means of accomplishing some legitimate legislative goal, we do not think that it would have taken so extraordinary a step without making its intent very clear.

*331 A similar overcompensation problem exists with statutory and punitive damages, which may also be included in a judgment. In Cavnar we explained the reasons for not charging prejudgment interest on such damages:

Commentators are virtually unanimous in advocating that prejudgment interest not be awarded on future damages and punitive damages.

Punitive damages are intended to punish the defendant and to set an example to others. They are assessed over and above the amount of damages necessary to indemnify the plaintiff. The plaintiff can thus be made whole even if prejudgment interest is not awarded on punitive damages. The plaintiff is likewise unharmed by the defendant’s retention of future damages prior to trial since these damages are, by their very nature, unaccrued.

696 S.W.2d at 555-656 (citations omitted). The Court rejects the thought that prejudgment interest could be awarded on punitive damages, based upon a separate statute, Tex. Civ.PRAc. & Rem.Code § 41.006. Ellis County State Bank v. Keever, 888 S.W.2d 790 (Tex.1994). I agree that section 41.006 and section 1.05 should be read consistently, but to do so supports the construction of section 1.05 that does not award prejudgment interest on future damages. The difficulty in the Court’s position is that it must concede that even though prejudgment interest is expressly prohibited on punitive damages, it may be allowed on statutory damages which have the same purpose.

It is possible to avoid all these problems and give effect to both the phrase “on the judgment” and the word “interest” by construing section 6(a) to authorize prejudgment interest on judgment amounts whenever interest — as that word has been defined by the Legislature and by this Court, and as it has always been understood — can be applied. “Interest” would apply only to past damages and not to future, statutory or punitive damages; it would apply to attorney fees only to the extent they were incurred prior to judgment. The statute entitles plaintiffs in wrongful death, personal injury and property damage cases to prejudgment interest on any sum in the judgment which can bear interest during the period over which it accrues, that is, on any loss which existed prior to judgment. This construction compensates plaintiffs fully for their losses, without overcompensating them and without penalizing defendants for nothing more than awaiting trial.

Consequently, I would hold that plaintiffs are not entitled to prejudgment interest on future damages. Plaintiffs, having failed to request that the jury be instructed to segregate their findings on past and future losses, should not be entitled to recover prejudgment interest on amounts which may have included future damages. Cavnar, 696 S.W.2d at 556 . Prejudgment interest should be awarded only on the $1 million awarded for Thompson’s pain and suffering, and the funeral expenses, after the settlement credit is applied pro tanto to those amounts. Since these damages are 14.69% of the total plaintiffs incurred, they should be reduced by that same percentage of the $6 million credit before prejudgment interest is calculated.

C & H and Ecotech contend that prejudgment interest on future damages is also prohibited by the Fifth and Fourteenth Amendments to the United States Constitution and by article I, sections 15, 19 and 29 of the Texas Constitution. In view of my construction of section 6(a), I need not reach these arguments.

I would reverse the lower courts’ award of prejudgment interest on unsegregated past and future damages. Accordingly, I dissent.

. Montford and Barber in fact reject a "literal” approach in addressing whether the “judgment” includes prejudgment interest, and so prejudgment interest on prejudgment interest. They reason that construing "judgment” as including prejudgment interest would result in "compounding” of interest, which in turn would conflict with the statutory provision for simple interest and its "legislative intent”. Montford & Barber, 25 Houston L.Rev. at 106-07 n. 24.