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HARBOR INS. CO. v. SCHNABEL FOUND. CO.

July 27, 1997

HARBOR INSURANCE COMPANY, Plaintiff,
v.
SCHNABEL FOUNDATION COMPANY, et al., Defendants.



The opinion of the court was delivered by: GREENE

 This action between plaintiff Harbor Insurance Company ("Harbor") and defendant Schnabel Foundation Company ("Schnabel"), was retried to the Court following remand by the Court of Appeals.

 Harbor, subrogee of OMNI Construction, Inc. ("OMNI"), brought this action against Schnabel for professional negligence. In an Opinion dated April 4, 1997, this Court found that defendant Schnabel, OMNI's subcontractor, had been negligent in its installation of the sheeting and shoring system at an office building at 601 Pennsylvania Avenue, N.W. The Court adjudged Schnabel liable for the damages its negligence caused to the Sears Building, located at 633 Pennsylvania Avenue, N.W., but required further briefing from the parties on the issue of damages.

 OMNI, the general contractor at the 601 Pennsylvania Avenue site, incurred substantial costs in repairing the damage to the Sears Building. OMNI submitted these claims to Harbor, its umbrella liability insurance carrier, as these costs were incurred. In the coverage dispute between Harbor and OMNI, this Court ordered that Harbor pay OMNI $ 844,199.60, plus post-judgment interest in the amount of $ 65,826.91, attorneys' fees in the amount of $ 54,876.88, and prejudgment interest in the amount of $ 65,904.31. The total amount paid by Harbor to OMNI was $ 1,030,727.17.

 The parties have entered into a settlement agreement with respect to the damages for repair costs to the Sears Building. *fn1" Still in dispute, however, is Harbor's entitlement to attorneys' fees and prejudgment interest accruing upon its claims for the reasonable cost of repair of the Sears Building.

 I

 Prejudgment Interest

 District of Columbia law provides that "in an action . . . to recover a liquidated debt on which interest is payable by contract or by law or usage the judgment for the plaintiff shall include interest on the principal debt from the time when it was due and payable, at the rate fixed by the contract, if any, until paid." D.C. Code § 15-108. The award of prejudgment interest on liquidated debts is mandatory as a matter of law. Giant Food, Inc. v. Jack I. Bender & Sons, 399 A.2d 1293, 1305 (D.C. 1979). *fn2" A debt is liquidated if "at the time it arose, it was an easily ascertainable sum certain." Kiser v. Huge, 170 U.S. App. D.C. 407, 517 F.2d 1237, 1251 (D.C. Cir 1974), rev'd on other grounds, 171 U.S. App. D.C. 1, 517 F.2d 1275 (1975)(en banc).

 Harbor is entitled to prejudgment interest on the reasonable cost of repairs to the Sears Building, as well as the amounts paid for profit and overhead, because these sums are "liquidated debt[s] on which interest is payable by contract . . . ." From the onset of litigation, the parties stipulated that $ 978,208.60 was the reasonable amount for repair of the Sears Building. These amounts were easily determinable at the time they arose, when OMNI submitted the claims to Harbor. They did not fluctuate during the course of the litigation. See Hartford Accident & Indemnity Co. v. District of Columbia, 441 A.2d 969, 974 (D.C. 1982). The amount paid to OMNI for overhead and profit was precisely determinable as well. This sum was calculated as a portion of the reasonable cost of repair according to specified percentages. The only contested issue throughout the two trials was Schnabel's liability for the damage to the Sears Building. The fact that Schnabel disputed the validity of these claims does not affect whether prejudgment interest is to be awarded. Giant Food, Inc., 399 A.2d at 1302.

 Prejudgment interest is calculated from the date the liquidated debts became due and payable. D.C. Code § 15-108. Article 6.e. of the Subcontract Agreement between OMNI and Schnabel provided that "all liability provisions of this Subcontract shall be paid upon demand." OMNI demanded this payment from Schnabel by letter dated August 31, 1984 and by the filing of this action on August 25, 1987. Thus for the claims submitted on August 28, 1986, November 19, 1986, May 21, 1987, and July 14, 1987 prejudgment interest commences on August 25, 1987. For the claims submitted at a later time which were in dispute, prejudgment interest will commence from the date of the agreement by which these disputed claims were resolved. Thus for claims agreed to on August 25, 1987, interest commences on September 24, 1987 and for claims agreed to on January 11, 1988 prejudgment interest commences on February 10, 1988 (the dates on which these sums became due and payable).

 II

 Attorneys' Fees

 Harbor also seeks attorneys' fees. First, Harbor argues that Schnabel must reimburse Harbor for the $ 54,876.88 Harbor paid to OMNI for investigating and settling Sears' claim. Second, Harbor claims that is entitled to recover $ 653,747 in ...


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