Brown v. Office of the Commissioner of Probation , 87 Mass. App. Ct. 729 ( 2015 )

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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.