URBAN v. GUEST INC (2007)

Plaintiff commenced this action seeking damages for, inter alia, breach of an agreement pursuant to which he leased property to defendant B.R. Guest, Inc., also known as B.R. Guest, Ltd. Supreme Court conducted a nonjury trial and awarded plaintiff a sum for unpaid school taxes, missing inventory, and damage to the property.  We agree with plaintiff that the court erred in awarding preverdict interest at the rate of 4% per annum, rather than 9% per annum, and we therefore modify the judgment accordingly.  “Interest shall be recovered upon a sum awarded because of a breach of performance of a contract, or because of an act or omission depriving or otherwise interfering with title to, or possession or enjoyment of, property” (CPLR 5001[a] ), and the statutory rate of interest is 9% per annum (see CPLR 5004).  Contrary to defendants' contention, the damages awarded here were not equitable in nature, and the court therefore did not have discretion to impose a different rate of interest (see CPLR 5001[a];  Davenport v. Martin, 4 A.D.3d 873, 771 N.Y.S.2d 460;  Zimmerman v. Tarshis, 300 A.D.2d 477, 751 N.Y.S.2d 418;  see generally Action S.A. v. Marc Rich & Co., 951 F.2d 504, 508–509, cert. denied 503 U.S. 1006, 112 S.Ct. 1763, 118 L.Ed.2d 425).

It is hereby ORDERED that the judgment so appealed from be and the same hereby is unanimously modified on the law by providing that preverdict interest shall be at the rate of 9% per annum and as modified the judgment is affirmed without costs.

MEMORANDUM: