## Facts

- Hussey Range Division of Copper Range Co. (Hussey) bought a large electromagnetic channel-type copper furnace from Lectromelt Furnace Division, McGraw Edison Co. (Lectromelt) for \$387,000, including \$15,000 for engineering services.
- The parties’ arrangement involved written agreements for the furnace equipment and related engineering and installation work; the contract also barred consequential damages for breach.
- From the start of operations, the furnace experienced repeated shutdowns and mechanical problems, requiring repairs and modifications over time.
- The causes of the shutdowns were disputed: some were tied to furnace problems, while others were attributed to Hussey’s operating and maintenance practices or to outside events such as strikes and a flood.
- Hussey sued Lectromelt in federal court on diversity jurisdiction for breach of contract. Lectromelt counterclaimed, asserting Hussey’s poor operation and maintenance caused problems and damages.
- After a six-week jury trial with extensive evidence about breakdowns, repairs, and shutdown causes, the jury awarded Hussey \$316,000 and awarded Lectromelt \$45,000 on the counterclaim. The jury also found Hussey “accepted” the furnace under U.C.C. § 2-607 on May 12, 1969.
- The judgment was entered with “interest as provided by law.” With Lectromelt’s appeal pending, Hussey (by leave of the Third Circuit) moved under Rule 59(e) to alter or amend the judgment to add \$168,270 in prejudgment interest (claimed from May 1, 1967 to March 15, 1976).
- The reported decision addresses only Hussey’s post-trial request for prejudgment interest.

## Issues

1. Did the parties waive submission of prejudgment interest to the jury, permitting the court to decide the issue after the verdict?
2. Under Pennsylvania law governing prejudgment interest in contract actions, was Hussey entitled to interest as of right because the damages were a “definite sum,” or, if not, should interest be awarded in the court’s discretion because justice required it?

## Decision

- The court held the parties waived a jury determination on prejudgment interest because, during trial, the court stated it would handle interest separately to avoid confusing an already difficult damages presentation, and no party requested an interest instruction or objected under Rule 51.
- Applying Pennsylvania law, the court denied prejudgment interest as of right because the verdict did not represent a definite sum due at a fixed time or a value readily calculable from contract standards or market prices.
- The court also declined to award prejudgment interest as a discretionary matter, concluding that the damages were heavily contested and dependent on disputed causation and allocation of responsibility over years of operational events, so justice did not call for an added award for delay.
- Hussey’s Rule 59(e) motion to add \$168,270 in prejudgment interest was denied.

## Legal Principles

- In a diversity case, state law controls the availability of prejudgment interest on state-law claims.
- Pennsylvania contract law follows Restatement (First) of Contracts § 337 (as adopted in Penneys v. Pennsylvania R.R. Co.):
  - § 337(a): Simple interest at the legal rate is recoverable as damages as of right when the breach is of an obligation to pay a definite sum, or to render performance with a stated value, or a value ascertainable by mathematical calculation from a contract standard or established market prices.
  - § 337(b): In other contract cases, interest may be allowed in the court’s discretion if justice requires it, based on the amount that would have been just compensation if paid when due.

- A jury’s award after a long, disputed trial does not automatically make damages “definite” for § 337(a) purposes when the amount depends on contested factual findings about causation, responsibility, and valuation.
- Parties may waive jury determination of interest by accepting a procedure that reserves the matter for the judge and by failing to request a jury instruction or object to the omission as required by Rule 51.

## Conclusion

The court ruled that prejudgment interest would not be added to Hussey’s \$316,000 contract verdict because the parties waived jury consideration of interest, the damages were not a definite or mechanically computable sum under Pennsylvania’s Restatement § 337(a) standard, and the court declined to award discretionary interest under § 337(b) given the sharply disputed, fact-driven nature of the losses.


Hussey Range Div. of Copper Range Co. v. Lectromelt Furnace Div., McGraw Edison Co., 417 F. Supp. 964 (1976)