Mezu v. Progress Bank of Nigeria PLC et al

Filing 32

MEMORANDUM. Signed by Judge James K. Bredar on 12/11/13. (c/m)(hmls, Deputy Clerk)

IN THE UNITED STATES DISTRICll CClTfi.Jir.I~Or' ~ _['
.~.y,/S~\".
LU JilT
FOR THE DISTRICT OF MARIi'lEA<'N1T, MAfli'L I\ND
OF

*
SEBASTIAN OKECHUKWU

MEZU,

lUll DECI 2 P I£~34
CLERt('S OFFiCE

*

Plaintiff

~',
D 1 ••

*

v.

AT Bi\LTIMOR:

*

PROGRESS
et al.,

. _ ..•..

:.,"?L'lY

CIVIL NO. JKB-12-2865

*

BANK OF NIGERIA, PLC,

*
Defendants

*

*

*

*

*

*

*

*

*

*

*

*

MEMORANDUM
The Court now considers Plaintiffs
Federal Rule of Civil Procedure 59(e).

motion to alter or amend a judgment, pursuant to

(ECF No. 30). Plaintiff seeks an amendment to this

Court's June 17, 2013, judgment (ECF No. 16) to include the prejudgment and postjudgment
interest awarded by the judgment of "the Federal Court Holden at Port Harcourt," Nigeria.

This

Court has considered the motion and will amend its June 17,2013, judgment as follows.
Sitting in diversity, this Court applies the law of the forum state, which in this case is
Maryland. Erie R.R. Co. v. Tompkins, 304 U.S 64, 78 (1938). Maryland has a statute that grants
recognition to a foreign state's money-judgment, i.e., one granting or denying recovery of a sum
of money, "that is final, conclusive, and enforceable where rendered."

Md. Code Ann" Cts. &

Jud, Proc, 99 10-70l(b), 10-702 (LexisNexis 2013) ("Recognition Act"), Nigeria fits within the
definition of "foreign state" in the Recognition

Act.

Md. Code Ann., Cts. & Jud. Proc.

910-701(c).
Plaintiff has supplied an authenticated copy of a default judgment obtained by Emekuku
against two entities, one of which is Progress Bank, (Comp!. Ex. I.) The judgment was entered

"In the Federal Court Holden at Port Harcourt" on October 21, 1999, in the amount of
N2,000,746.28 (two million seven hundred forty-six naira and twenty-eight kobo). According to
the Plaintiff who is the Chairman and majority stockholder of Emekuku and who has been
authorized by Emekuku's Board to file suit on its behalf, this amount of Nigerian money is equal
to $23,860.73 in American money.

(Id Ex. 2, pp. 2-3.)

On June 17, 2013, pursuant to the

Recognition Act, this Court recognized the judgment submitted to the Court by Plaintiff as a
judgment of this Court. (ECF No. 16.) Plaintiff now seeks an amendment to that judgment to
reflect prejudgment and postjudgment interest, at rates of 21%, as awarded by the foreign
judgment.
The foreign judgment awarded prejudgment interest from April, 1996, until the date of
the entry of the judgment, October 21, 1999.1

It is noted that the Nigerian judgment did not

specify a sum certain for prejudgment interest.

Thus, although prejudgment interest can be

lawfully awarded by this Court, the Court is bound in this diversity case to apply applicable
Maryland choice-of-Iaw rules.

See Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496

(1941); DiFederico v. Marriott Int'!, Inc., 714 F.3d 796, 807 (4th Cir. 2013).

The Court,

therefore, must apply Maryland law to determine the rate of prejudgment interest, see Fed Sav.
& Loan Ins. Corp. v. Quality Inns, Inc., 876 F.2d 353, 359 (4th Cir. 1989); I W. Berman
Properties v. Porter Bros., Inc., 344 A.2d 65,79 (Md. 1975), and the amount awarded should not
exceed Maryland's maximum rate of interest.

The Maryland Constitution states that the legal

rate of interest is 6% unless otherwise provided by the Maryland General Assembly. Md. Const.
art. III,

9 57.

Thus, this Court is bound by Maryland's legal rate of prejudgment interest, which

is 6%, and shall apply that rate here. Further, this Court notes that prejudgment interest accrues

I The foreign judgment
noted the principal and interest on the debt was fixed as of March 27, 1996, but then
awarded prejudgment interest "from April 1996 until [October 21, 1999]." The Court interprets this as awarding
prejudgment interest from April 1, 1996, to October 21, 1999.

2

as non-compounding

interest, i.e., simple interest.

Quesinberry v. Life Ins. Co. of North

America, 987 F.2d 1017,1031 n.13 (4th Cir. 1993); I W Berman Properties, 344 A,2d at 79.
Because this Court is bound in this diversity case to apply Maryland's rules for choice of
law, see Klaxon Co., 313 U.S. at 496; DiFederico, 714 F.3d at 807, it will also apply Maryland's
choice-of-Iaw rule for postjudgment interest on a foreign judgment.

On this point, the Maryland

law holds that the rate of postjudgment interest on a foreign judgment is determined by the law
of the forum (lex fori) and not by the law of the jurisdiction rendering the judgment (lex loci).
Mike Smith Pontiac, GMC, Inc. v. Mercedes-Benz of North America, Inc., 741 A.2d 462, 469
(Md. 1999) (citations omitted).

Because the forum is this federal Court, postjudgment interest

shall at be the prevailing statutory rate calculated from the date of the entry of the judgment.
28 U.S.C.

S

1961.

Accordingly, this Court is not beholden to apply the 21% interest rate

awarded by the foreign judgment.

Rather, this Court will calculate postjudgment

interest

according to the prevailing statutory rate as of October 21, 1999, the date of entry of the
judgment.

The prevailing statutory rate, therefore, is the "rate equal to the coupon issue yield

equivalent (as determined by the Secretary of the Treasury) of the average accepted auction price
for the last auction of fifty-two week United States Treasury bills settled immediately prior to the
date of the judgment" -

5.12% compounded annually. 28 U.S.C.

SS

1961(a), (b) (1994). This

Court also notes that postjudgment interest may accrue on the entire amount awarded by the
foreign judgment,

including prejudgment interest.

Quesinberry, 987 F.2d at 1031-32; I W

Berman Properties, 344 A,2d at 79.
Accordingly, this Court's June 17, 2013, judgment (ECF No. 16) shall be amended to
include prejudgment interest, at a rate of 6% non-compounding,
October

21, 1999, and statutorily

prescribed

postjudgment

from April 1, 1996, through
interest, at a rate of 5.12%

compounded annually, from October 21,1999, until liquidation of the debt.
3

A separate order will issue.

DATED this

II

day of December, 2013.

BY THE COURT:

O~'1.{.B~
James K. Bredar
United States District Judge

4