Arley v. Liberty Mut. Fire Ins. Co.

• Decision Date: 23 September 1969
• Docket Number: No. 5782,5782
• Citation: 458 P.2d 742,85 Nev. 541
• Parties: Charlotte Hunter ARLEY, Appellant, v. LIBERTY MUTUAL FIRE INSURANCE COMPANY, a Massachusetts corporation, Respondent.
• Court: Nevada Supreme Court

Page 742

458 P.2d 742

85 Nev. 541

Charlotte Hunter ARLEY, Appellant, v. LIBERTY MUTUAL FIRE INSURANCE COMPANY, a Massachusetts corporation, Respondent.

No. 5782.

Supreme Court of Nevada.

Sept. 23, 1969.

Charlotte Hunter Arley, Seattle, Wash., Fry & Fry, Reno, for appellant.

[85 Nev. 542] Woodburn, Forman, Wedge, Blakey, Folsom & Hug an Roger W. Jeppson, Reno, for respondent.

OPINION

MOWBRAY, Justice:

This is the third time this case has come to us on appeal. Appellant Arley sued respondent Liberty Mutual Fire Insurance Company for property losses covered by a fire insurance policy which Arley had with Liberty. The district court awarded Arley $35,000, the full amount of the policy, but denied her claim for prejudgment interest on the award. Arley appealed and we affirmed the lower court's decision. Arley v. Liberty Mut. Fire Ins. Co., 80 Nev. 5, 388 P.2d 576 (1964). The remittitur was filed on April 13, 1964, and interest on the judgment commenced to run from that date. Liberty sought to satisfy the judgment, but Arley refused to accept payment, claiming, this time, interest from the date of the original judgment--December 13, 1962. Upon Liberty's application the district court entered an order that, upon payment of the $35,000 award plus interest from the date of the filing of the remittitur, a satisfaction of judgment would be entered on the record. Again Arley appealed, and again we sustained the ruling of the district judge in allowing interest only from the date the remittitur was filed. Arley v. Liberty Mut. Fire Ins. Co., 81 Nev. 411, 404 P.2d 426 (1965).

In February 1968 this court reviewed in depth the question of the alloance of prejudgment interest, in Paradise Homes, Inc. v. Central Sur. & Ins. Corp., 84 Nev. 109, 437 P.2d 78 (1968). In Paradise, we abandoned the 'liquidated claim' versus 'nonliquidated claim' test in determining whether prejudgment interest should be allowed, and suggested at 116, 437 P.2d at 83, that a two-fold standard be used in making such a determination:

'Three items must be determined to enable the trial court to make an appropriate award of interest: (1) the rate of interest; (2) the time when it commences to run; and (3) the amount of money to which the rate of interest must be applied. The rate of interest is set by our statute at seven percent per annum. N.R.S. 99.040. The statute also states that interest runs from the time 'money becomes due.' We construe that to be the time when performance was due as resolved by the court upon trial of the cause. The amount of money to which the interest rate will be applied must be determined by the following factors: (1) if the contract breached provides for a definite sum of money, that sum; (2) if the performance called for in the contract, the value of which is stated in money or is ascertainable by mathematical calculation from a standard fixed in the contract or from established market prices of the subject matter, that sum. Pre-judgment interest shall be allowed on the amount of the debt or money value so determined, after making all the deductions to which the defendant may be entitled. 1 Restatement of the Law, Contracts, § 337(a); O'Meara v. Commercial Insurance Company, 71 N.M. 145, 376 P.2d 486 (1962). See also Dollar Investment Corp. v. Modern Market, Inc., supra, (77 Nev. 393, 365 P.2d 311 (1961)); Sierra Pacific Power Co. v. Nye, supra, (80 Nev. 88, 389 P.2d 387 (1964)). A seemingly different conclusion in any other Nevada case cited above is specifically overruled.' (Footnote omitted; emphasis added.)

On August 1, 1968, Arley commenced an independent action for post-judgment relief pursuant to Rule 60 NRCP, in which she asked that the court set aside the satisfaction of her judgment and that the judgment be 'corrected' to include interest from the date the $35,000 was 'first due'--October 17, 1960. This third attempt by Arley to recover prejudgment interest was predicated entirely upon our decision in Paradise. Upon Liberty's application, the district court dismissed Arley's motion; thus the present appeal.

Rule 60(b) provides in part that the court may relieve a party or his legal...