Grunenthal v. Long Island Railroad Company

• Decision Date: 04 December 1969
• Docket Number: No. 253,Docket 33807.,253
• Citation: 418 F.2d 1234
• Parties: Carl F. GRUNENTHAL, Plaintiff-Appellee, v. The LONG ISLAND RAILROAD COMPANY, Defendant and Third-Party Plaintiff-Appellant, v. T. F. CONTRACTING CO., Inc., Third-Party Defendant.
• Court: U.S. Court of Appeals — Second Circuit

418 F.2d 1234 (1969)

Carl F. GRUNENTHAL, Plaintiff-Appellee, v. The LONG ISLAND RAILROAD COMPANY, Defendant and Third-Party Plaintiff-Appellant, v. T. F. CONTRACTING CO., Inc., Third-Party Defendant.

No. 253, Docket 33807.

United States Court of Appeals Second Circuit.

Argued November 11, 1969.

Decided December 4, 1969.

Milford J. Meyer, Philadelphia, Pa. (Meyer, Lasch, Hankin & Poul, Philadelphia, Pa., of counsel), for plaintiff-appellee.

James T. Gallagher, Jamaica, N. Y. (George M. Onken, Jamaica N. Y. of counsel), for defendant and third-party plaintiff-appellant.

Before MOORE, KAUFMAN and HAYS, Circuit Judges.

PER CURIAM:

This controversy involves a single issue, whether interest on a judgment recovered by appellee against appellant should be computed at the rate of six percent per annum as claimed by appellee or four percent per annum as claimed by appellant.

Appellee, an employee of The Long Island Railroad Company, was injured on September 19, 1962 in the course of his employment. He brought an action in the United States District Court for the Southern District of New York to recover damages for his injuries under the Federal Employers' Liability Act. On March 2, 1967 a verdict in his favor was returned for $305,000.

On appeal this court ordered the case remanded for a new trial unless plaintiff would agree to remit all of the verdict in excess of $200,000. Grunenthal v. Long Island R. R., 388 F.2d 480 (2d Cir. 1968). That determination was reversed by the Supreme Court. Grunenthal v. Long Island R. R., 393 U.S. 156, 89 S.Ct. 331, 21 L.Ed.2d 309 (1968).

The district court ordered that interest on the judgment be paid at the rate of six percent per annum and the Long Island appeals. We affirm the order of the district court.

Section 1961 of Title 28 of the United States Code provides that interest on a money judgment recovered in a civil case in a district court "shall be calculated from the date of the entry of the judgment, at the rate allowed by State law."

The applicable law is that of the State of New York. Section 5004 of New York's Civil Practice Law and Rules provides: "Interest on a money judgment shall be at the legal rate, except where otherwise prescribed by statute."

Under the New York General Obligations Law, McKinney's Consol.Laws, c. 24-A, § 5-501, the legal rate of interest is six percent per annum.

This analysis would dispose of the present controversy except that the Long Island claims that a four percent rate is made applicable to it by a special statutory provision. It argues that as a subsidiary corporation of the Metropolitan Transportation Authority it is entitled to the benefits of Section 1266, subdivision 5, of the New York Public Authorities Law, McKinney's Consol.Laws, c. 43-A, which provides in pertinent part:

"Each such subsidiary corporation and any of its property, functions and activities shall have all of the privileges, immunities, tax exemptions and other exemptions of the authority and of the authority\'s property, functions and activities."

One of the "privileges" to which the Long Island claims to be entitled is that provided by Section 1276, subdivision 5 of the Public Authorities Law:

"The rate of interest to be

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