Interest and offers of judgment in Minnesota section 549.09 and Rule 68

Civil lawyers know that interest can be substantial if the judgment is large enough.  This case suggests that interest accrues from the beginning of the case.  Also, it suggests that two offer different sources to cut off interest accrual exists in Minnesota, Rule 68 and Minn. Stat. 549.09.

STATE OF MINNESOTA IN DISTRICT COURT
COUNTY OF DOUGLAS SEVENTH JUDICIAL DISTRICT
Dennis Larson, Court File No.: 21-CV-09-620
Plaintiff,
v.
Le Homme Dieu Cabin Rentals LLC,
Roy Anderson, Nicholas Bormann,
and Steven Bormann,
Defendants.
A jury trial in this matter was held before the Honorable David R. Battey on November
30, 2010. The jury returned its verdict on December 2, 2010. Plaintiff filed a Motion for Entry of Judgment on January 5, 2011. A telephone hearing was held with the Honorable David R. Battey on March 28, 2011. This matter was taken under advisement on March 28, 2011.

FINDINGS OF FACT
On December 2, 2010, the jury returned its Special Verdict form. The Court incorporates
the following Special Verdict questions and answers as Findings of Fact. The Special Verdict
included answers to questions No. 1 through 11, as follows:
1. Was Defendant Steven Bormann negligent?
Yes ___X___ No _______
2. If you answered “Yes” to Question 1, please answer this question: was Steven Bormann’s
negligence a direct cause of the event that led to Dennis Larson’s injury?
Yes ___X___ No _______
2
3. Was Defendant Nicholas Bormann negligent?
Yes __ X__ No _______
4. If you answered “Yes” to Question 3, please answer this question: was Nicholas
Bormann’s negligence a direct cause of the event that led to Dennis Larson’s injury?
Yes ___X__ No _______
5. Was Defendant Le Homme Dieu Cabin Rentals LLC, not including any negligence by
Dennis Larson in his capacity as President/Chief Manager of Le Homme Dieu Cabin
Rentals LLC, negligent?
Yes ___X___ No _______
6. If you answered “Yes” to Question 5, please answer this question: was Le Homme Dieu
Cabin Rental’s negligence a direct cause of the event that led to Dennis Larson’s injury?
Yes _______ No ___X___
7. Was Plaintiff Dennis Larson negligent either personally or in his capacity as
President/Chief Manager of Le Homme Dieu Cabin Rentals?
Yes ___X___ No _______
8. If you answered “Yes” to Question 7, please answer this question: was Dennis Larson’s
negligence a direct cause of the event that led to his injury?
Yes ___X___ No _______
9. Taking all of the negligence that contributed as a direct cause of harm or injury to Dennis
Larson as 100%, what percentage of the negligence do you attribute to:
Steven Bormann ___60__%
Nicholas Bormann ___10__%
Le Homme Dieu Cabin Rentals ___5___%
Dennis Larson ___25__%
TOTAL 100%
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10. What amount of money will fairly and adequately compensate Dennis Larson for past
damages he sustained as a result the July 2, 2006 event, up to the date of this verdict for:
a) Medical expenses of every kind $ 21,312.79
b) Pain, disability, disfigurement,
embarrassment, and emotional distress $ 110,000.00
11. What amount of money will fairly and adequately compensate Dennis Larson for
damages reasonably certain to occur in the future as a result of the July 2, 2006 event for:
a) Pain, disability, disfigurement,
embarrassment, and emotional distress $ 0
12. Plaintiff’s reasonable costs and disbursements include:
Statutory Costs $200.00
Filing Fees $525.00
Service Fees $643.00
Expert Witness Fees $4,616.00
Witness Fees $513.00
Mediation $962.50
Miscellaneous Costs $25.00
Deposition Costs $2,400.20
Medical Records and Exhibits $1,109.84
Total $10,994.54
CONCLUSIONS OF LAW
1. Plaintiff is not entitled to recover against either Nicholas Bormann or Le Homme Dieu
Cabin Rentals LLC. Both are entitled to a Judgment of dismissal.
2. Plaintiff’s total damages are $131,312.79. Plaintiff is entitled to recover 75% of those
damages, which equals $98,484.59. Steven Bormann is jointly and severally liable to Plaintiff
for $98,484.59 before interest and costs and disbursements.
3. Plaintiff is entitled to pre-verdict interest on $98,484.59 at a rate of 10% per year from
the commencement of the action on June 26, 2008. Plaintiff is entitled to $ _________ as preverdict
interest.
4
4. Together with the above damages and interest, Plaintiff’s Judgment against Steven
Bormann shall include Plaintiff’s reasonable costs and disbursements in the amount of
$10,994.54.
5. This Court has not addressed any collateral offset issues. Defendant Steven Bormann
originally filed a motion to reduce Plaintiff’s recovery pursuant to Swanson v. Brewer, however
that motion was withdrawn.
ORDER FOR JUDGMENT
LET JUDGMENT BE ENTERED ACCORDINGLY.
It is so ordered upon this ______ day of ________________, 2011.
______________________________
Hon. David R. Battey
Judge of District Court
JUDGMENT
The Conclusions of Law as set forth herein shall be deemed the Judgment filed herein.
Dated this ______ day of _______________, 2011.
_______________________________________
Douglas County Court Administrator
5
MEMORANDUM
Plaintiff Dennis Larson brings this Motion for Entry of Judgment following a trial in
which a jury awarded him $23,312.791 for medical expenses and $110,000 for past pain,
disability, disfigurement, embarrassment, and emotional distress. Plaintiff argues that because
the jury attributed some fault to each of the three defendants, that Minn. Stat. § 604.02 applies,
and Defendant Steven Bormann is jointly and severally liable for the entire amount less the
percentage attributed to Plaintiff. Alternatively, Plaintiff argues that even if Minn. Stat. § 604.02
does not apply, the result is the same. Steven Bormann argues that Minn. Stat. § 604.02 does not
apply because Plaintiff’s fault exceeds that of all but one defendant, and that Steven Bormann
should be severally liable for the percentage of fault attributed to him.
Second, Plaintiff contends that pre-verdict interest should be applied at a ten-percent
interest rate to the entire judgment. Steven Bormann argues that no pre-verdict interest should be
awarded on the past pain damages because the damages were not ascertainable. Further, Steven
Bormann contends that if interest is awarded, the ten-percent interest rate should not be
retroactive to the date of commencement of the action. Regardless, he argues that Defendants
made an Offer of Judgment of $50,000, and that any interest awarded should be based on that
amount, not the entire judgment.
Third, Plaintiff, as the prevailing party, seeks reasonable costs and disbursements. Steven
Bormann disputes some of Plaintiff’s Bill of Costs as unreasonable, but agrees that Plaintiff is a
prevailing party. Defendants Nicholas Bormann and Le Homme Dieu Cabin Rentals LLC
(“LHD”) also seek costs and disbursements because they were prevailing parties to the action.
1 This amount was stipulated to by the parties.
6
Facts
Plaintiff and Defendants Steven and Nicholas Bormann were members of a limited
liability company (“LLC”) that owned land and cabins on Lake Le Homme Dieu. Plaintiff was
the president of the LLC. Being on the water, the parties had boats and often took those boats on
the lake. The boats were stored on boat lifts attached to the dock. The Bormanns owned one of
these lifts. Their lift was electric, and to power it, they ran an electrical cord from one of the
cabins under the water to the boat lift.
On July 2, 2006, the three parties and their families were at the lake for Fourth of July
weekend. Sometime that evening, Steven Bormann took the families’ children on the lake in
Plaintiff’s boat. As Steven Bormann was navigating the boat back to shore, he ran over the cord
to the boat lift, creating an electric current in the water and electrifying the boat. When he
touched the side of the boat, he was electrocuted. Seeing Steven Bormann laying motionless in
the boat with children still aboard, Plaintiff jumped into the water and grabbed the boat. In doing
so, he was also electrocuted. After his grip released from the boat, Plaintiff ended up under
water for a significant period of time, almost drowning. Plaintiff suffered injuries as a result of
the events.
Plaintiff served Defendants with a Summons and Complaint on June 26, 2008. A jury
trial was held from November 30 to December 2, 2010. Following the trial, the jury attributed
fault in these percentages: Steven Bormann – 60%; Plaintiff – 25%; Nicholas Bormann – 10%;
LLC – 5%. They found that Plaintiff had suffered $110,000 in past pain and suffering damages,
but found no future damages. Past medical expenses were stipulated to by the parties. Plaintiff
now moves to enter judgment.
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Analysis
I. DEFENDANT STEVEN BORMANN IS LIABLE FOR THE ENTIRE AWARD
LESS PLAINTIFF’S CONTRIBUTORY FAULT
Although Minn. Stat. § 604.02 is not applicable, Defendant Steven Bormann is liable
pursuant to Minn. Stat. § 604.01 for the entire award less the twenty-five percent attributed to
Plaintiff by the jury.
A. Minn. Stat. § 604.02 is not Applicable Because Only One Defendant is Liable
to Plaintiff
“When two or more persons are severally liable, contributions to awards shall be in
proportion to the percentage of fault attributable to each, except that the following persons
are jointly and severally liable for the whole award: (1) a person whose fault is greater
than 50 percent; [inapplicable exceptions].” Minn Stat. § 604.02.
At trial, the jury determined the parties’ fault as follows: Defendant Steve Bormann
– 60%; Plaintiff – 25%; Defendant Nicholas Bormann – 10%; LHD – 5%2. Plaintiff
argues that because Nicholas Bormann shares “a portion of the fault in causing the
accident that injured” Plaintiff, he is a severally liable person under Minn. Stat. § 604.02.
Staab v. Archdiocese of St. Cloud, 780 N.W.2d 392, 394 (Minn. Ct. App. 2010). The
Court is not persuaded.
2 An issue exists as to LHD’s attributed fault. The jury indicated on the special verdict form that LHD’s negligence
was not a direct cause of the event that led to Plaintiff’s injury. Despite being told to only take “all of the
negligence that contributed as a direct cause” into account when attributing fault, the jury found LHD five percent
at fault.
Steven Bormann argues that finding him severally liable cures this problem, while finding him jointly liable creates
a problem. The Court disagrees. The Special Verdict form specifically asked about Dennis Larson’s negligence
“either personally or in his capacity as President/Chief Manager of Le Homme Dieu Cabin Rentals.” In doing so,
any of the fault that could have been attributed to Dennis Larson because of his involvement in LHD has already
been decided. The 5% attributed to LHD by the jury must necessarily be the result of actions by other members of
the LLC, and Steven Bormann would remain jointly liable for that amount.
8
For Minn. Stat. § 604.02 to apply in this case, there must be two or more
defendants “severally liable.” A defendant is not subject to liability unless the jury
attributes a higher percentage of fault to him than to the plaintiff. See Minn. Stat. §
604.01; See e.g. Horton by Horton v. Orbeth, Inc., 342 N.W.2d 112 (Minn. 1984). Horton
involved a contribution claim by one defendant against two other defendants. Id. The
initial action resulted in a jury verdict similar to this case, whereby one defendant was
found 74% at fault, the plaintiff was found to be 10% at fault, and the other two
defendants were attributed fault of 8% each. Id. at 113. In affirming the district court’s
denial of the primary defendant’s contribution claim, the Minnesota Supreme Court
reasoned that “even though the jury found [defendants] negligent to some degree, neither
was negligent to a degree sufficient to impose liability to the injured party. We have
consistently refused to require a party to contribute to an award when the quality of his
conduct did not justify imposing liability to the injured party.” Id. at 114. Although this
is not a claim for contribution between defendants, Horton makes clear that a defendant
whose fault is less than that of the plaintiff’s is not liable to the plaintiff.
Nicholas Bormann and LHD were attributed less fault than Plaintiff. Under
Minnesota law, they are not liable to Plaintiff for damages he sustained.
Plaintiff relies primarily on Staab for the proposition Nicholas Bormann and LHD
are severally liable under Minn. Stat. § 604.02. 780 N.W.2d 392. At first glance,
Plaintiff’s argument is convincing; however, upon further examination of Staab, the Court
is not persuaded.
In Staab, the plaintiff, broke her leg after falling out of a wheelchair being pushed
by her husband. Id. at 393. The accident occurred on property owned by the St. Cloud
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Diocese. Id. Staab sued the Diocese, but her husband was never named as a party. Id.
The jury returned a verdict for Staab, finding the Diocese and Staab’s husband each 50%
at fault. Id. The district court determined that Minn. Stat. § 604.02 did not apply, and
ordered the Diocese to pay 100% of the damages. Id. The Diocese appealed, arguing that
Minn. Stat. § 604.02 applied, and should only have been ordered to pay 50% of the
damages pursuant to the statute. Id. The Minnesota Court of Appeals agreed. The Court
analyzed the word “person” in the statute, concluding that a “person” is not simply a party
to the suit, “but any tortfeasor whose fault has been submitted to the jury.” Id.
Staab went on to state that the Diocese and Staab’s husband were “‘severally
liable’ because they were found to share a portion of the fault in causing the accident that
injured Respondent.” Id. This is the language upon which Plaintiff relies for his
contention that both Nicholas Bormann and LHD are severally liable. Staab, however,
was not examining the definition of “severally liable.” Both the Diocese and Staab’s
husband were found 50% at fault for Staab’s accident. Although Plaintiff is correct when
he points out that implicit in Staab is the holding that “severally liable” cannot mean
“legally obligated to pay the judgment,” Plaintiff is incorrect that “severally liable” must
then include everyone who has been attributed a percentage of fault, regardless of actual
or potential liability. Had Staab’s husband been named either a defendant or third-party
defendant, he would have been liable for his portion of the damages. The fundamental
difference in this case is that a jury absolved Nicholas Bormann and LHD of any liability,
both future and present, to the Plaintiff for his injuries. This Court cannot conclude that
Staab attempts, or even has the power, to change the longstanding rule that a defendant is
not liable when his attributed fault is less than the plaintiff’s.
10
Nicholas Bormann and LHD were found by the jury to have a lesser percentage of
fault than Plaintiff. Based on this finding, neither party is liable to Plaintiff. That leaves
only one party, Steven Bormann, liable to Plaintiff. Because Minn. Stat. § 604.02 only
applies when two or more persons are severally liable, the Court finds that this section is
not applicable.
B. Defendant Steven Bormann is Liable for 75% of Plaintiff’s Damages
Based on both common law and Minn. Stat. § 604.01, Steven Bormann is liable to
Plaintiff for the full amount of the damages less the 25% attributed to him by the jury.
A finding of contributory fault does not bar a plaintiff from recovering unless that
fault is greater than the fault of the person against whom recovery is sought. Minn. Stat. §
604.01. If, however, there is a finding of contributory fault, the plaintiff’s damages are
proportionally reduced by such fault. Id. The obvious corollary is that when there is only
one defendant whose fault exceeds the plaintiff’s, the defendant shall be liable for the
amount of damages reduced only by the plaintiff’s percentage of fault. Steven Bormann
argues that this longstanding principle no longer applies based on Minnesota’s shift
towards several liability, and that this Court should Order him liable only for the 60%
attributed to him by the jury.
Joint and several liability is governed by § 604.02. This Court has already
determined that § 604.02 does not apply. In fact, Steven Bormann argued the same.
Despite that, he also argues that the principles of joint and several liability, specifically
the presumption that a tortfeasor is liable only for the portion of fault attributed to him,
apply even when he is the only liable party. This Court disagrees.
11
Although there may have been a shift in the overall landscape of multiple-tortfeasor
liability from a presumption of joint liability to one of several liability, there has been no
change to either the statutory language or underlying rationale of § 604.01. § 604.01,
subd. 1, provides that a plaintiff may not recover from a person whose fault is found to be
less than the plaintiff’s, and that the damages recovered must be reduced by the
percentage of fault attributed to the plaintiff. Despite the significant legislative change in
2003 to § 604.02, the language of § 604.01, subd. 1, has remained substantively
unchanged since its inception. Had the legislature intended that § 604.01 be changed, it
could have easily added to the language of the section, requiring that the plaintiff’s
damages be further reduced by all non-liable parties found to have been at fault. See
Horton, 342 N.W.2d at 115-16 (“It would, perhaps, have been more consistent had the
legislature decreed that the damages be reduced in proportion to the aggregate fault of the
plaintiff and all less-at-fault parties, from whom the plaintiff cannot recover, but that is
not what the legislature did.”).
This case is almost identical to Jack Frost Inc. v. Engineered Bldg. Components
Co. 304 N.W.2d 346 (Minn. 1981). In Jack Frost, a jury found Defendant Hydro-Air
55% at fault, Plaintiff Jack Frost 30% at fault, and Defendant EBCO 15% at fault for Jack
Frost’s damages. Id. at 349. The district court ordered that Jack Frost pay 70% of the
damages3. Id. at 349. Hydro-Air appealed, contending that it should have only been
ordered to pay the 55% attributed to it by the jury. Id. In affirming the district court, the
Minnesota Supreme Court held:
Jack Frost’s causal negligence was not as great as Hydro-Air’s causal negligence.
Therefore, Jack Frost can recover damages from Hydro-Air. The extent of
Hydro-Air’s liability is not affected by the fact that only 55% of the causal
3 Total damages less the 30% attributed to the plaintiff
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negligence was attributed to Hydro-Air. Jack Frost suffered an indivisible injury
as a result of its own negligence and that of EBCO and Hydro-Air. Hydro-Air is
therefore liable for the entire amount of Jack Frost’s damages diminished, as
section 604.01, subd. 1, requires, by 30%, the proportion of the causal negligence
attributed to Jack Frost.
Id. at 352. Jack Frost makes it clear that when there is only one liable party, that party is liable
for the entire amount of the damages less the percentage of fault attributed to the plaintiff.
Steven Bormann is the only liable party, thus he is obligated to pay the entire amount of the
damages less the 25% fault attributed to Plaintiff.
Policy does not dictate that this Court enter judgment against Steven Bormann
for only 60% of the damages.
Even if this Court accepted Steven Bormann’s arguments that several liability is now the
presumption in all cases, not just those with multiple tortfeasors under § 604.02, it still could not
be reasoned that Steven Bormann should be liable for only 60% of the damages. Steven
Bormann’s argument relies almost entirely on the 2003 legislative amendment to § 604.02,
arguing that changing presumptive liability between multiple tortfeasors from joint to several
evidences legislative intent to essentially eliminate all joint liability beyond the exceptions
enumerated in § 604.02. Even looking past the above-stated problems with that argument, the
legislature made clear when amending § 604.02 that it still intended for persons whose fault is
found to be greater than 50% to remain jointly and severally liable for all damages. See Minn.
Stat. § 604.02 (“except that the following persons are jointly and severally liable for the whole
award: (1) a person whose fault is greater than 50 percent.”). Steven Bormann was attributed
60% of the fault for Plaintiff’s injuries. There is simply no policy argument for limiting his
liability to that amount under either statutory provision.
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II. PLAINTIFF IS ENTITLED TO PRE-VERDICT INTEREST AT A RATE OF TEN
PERCENT PER YEAR ON THE ENTIRE AWARD FROM THE
COMMENCEMENT OF THE ACTION
Minn. Stat. § 549.09 governs prejudgment and pre-verdict interest. Pursuant to Minn.
Stat. § 549.09, subd. 1(b), pre-verdict interest shall be awarded on pecuniary damages. As a
threshold issue, Plaintiff and Steven Bormann disagree as to whether “pecuniary damages”
include damages that are not ascertainable (e.g. pain and suffering damages).
Steven Bormann next argues that the 10% interest rate on judgments greater than $50,000
in subdivision (c)(2) should not apply before that provision was enacted. Finally, he argues that
even if the Court determines that interest is appropriate on unascertainable damages, that he
served a written offer of settlement pursuant to § 549.09, tolling interest accumulation. The
Court is not persuaded by Steven Bormann’s arguments.
A. Minn. Stat. § 549.09 Interest is Not Limited to Ascertainable Damages
The Minnesota legislature amended Minn. Stat. § 549.09 in 1984 (“the amendment”),
requiring pre-verdict interest on judgments and awards in certain circumstances. Prior to the
amendment, pre-verdict interest was awarded only on ascertainable damages. See Moosbrugger
v. McGraw-Edison Co., 170 N.W.2d 72, 82 (Minn. 1969) (“The general rule in this state is to
require interest in the case of a liquidated claim or a sum certain and not to allow interest in a
case of an unliquidated claim because a defendant does not know how much he owes until the
verdict is reached.”). Since the amendment, a Minnesota Supreme Court decision has directly
addressed the issue, holding that pre-verdict interest is awardable for all general damages, not
just those that are ascertainable. Lienhard v. State, 431 N.W.2d 861, 865 (Minn. 1988).
Confusing the issue, however, two diametrically opposing lines of cases from the Minnesota
14
Court of Appeals have arisen as to whether damages must still be ascertainable. Duxbury v. Spex
Feeds, Inc., 681 N.W.2d 380, 391 n.5 (Minn. Ct. App. 2004).
Because this Court finds that Lienhard’s language is not dicta, the Court relies on that
precedent to award pre-verdict interest on unascertainable damages.
Lienhard holds that damages no longer must be ascertainable
The Court first must first determine whether the on-point language in Lienhard is dicta,
as Steven Bormann argues. The Court finds that it is not.
Dicta are the court’s expressions which go beyond the particular facts of the case before
it. K.R. v. Sanford, 588 N.W.2d 545, 548 (Minn. Ct. App. 1996). The determination hinges on
whether the language was necessary to the court’s decision. Id. at 548-49. In Lienhard, the
court’s determination that pre-verdict interest is allowed “irrespective of a defendant’s ability to
ascertain the amount of damages for which he might be liable or to stop the running of interest,”
is necessary to the outcome. 431 N.W.2d at 865. As such, it is not dicta.
At issue in Lienhard was the State of Minnesota’s civil-liability tort cap. Id. at 863. A
jury found the State 50% at fault for Plaintiff’s $200,000 damages. Id. The State argued that the
tort cap limited costs, disbursements, and pre-verdict interest. Id. In analyzing the interest
portion, the Court stated that “section 549.09 was amended to allow pre-verdict interest
irrespective of a defendant’s ability to ascertain the amount of damages for which he might be
held liable or to stop the running of interest.” Id. at 865. The Court went on to hold that because
interest on unascertainable damages is not conventional interest on a sum of money, but rather an
attempt to provide full compensation by converting time-of-demand money into time-of verdict
money, it is simply an element of damages to be limited by the tort cap. Id.
15
Steven Bormann argues that the “irrespective of a defendant’s ability to ascertain”
language is dicta because it does not address the ultimate issue, the tort cap. This argument
misses the necessity of the determination that pre-verdict interest is awarded on unascertainable
damages. Without the initial determination that pre-verdict interest on unascertainable damages
is awardable, there would be no need to make a final determination as to whether pre-verdict
interest is limited by the tort cap. Because the Court’s determination that the ascertainability rule
no longer applies when awarding pre-verdict interest was essential to its holding, that language
was not dicta.
Further, both the Eighth Circuit and Minnesota Court of Appeals have adopted Lienhard
as precedent, holding that the language is indeed not dicta. Children’s Broadcasting Corp. v.
Walt Disney Corp., 357 F.3d 860, 869-70 (8th Cir. 2004); Myers v. Hearth Techs., Inc., 621
N.W.2d 787, 794 (Minn. Ct. App. 2001).
Lienhard’s language is not dicta, and this Court will follow its precedent. The
ascertainability rule no longer applies to pecuniary damages in § 549.09.
B. Interest Accrued at Ten Percent from Commencement of the Action4
This case presents an issue of statutory interpretation and a determination of whether
Minn. Stat. § 549.09’s amended interest rate applies to periods before the amendment’s effective
date.
§ 549.09’s clear and unambiguous language requires that Steven Bormann pay at a tenpercent
interest rate from commencement of the action.
4 The Court rejects any argument that the § 549.09’s amendment to set the interest on awards over $50,000 at
10% is unconstitutional. Steven Bormann failed to comply with Minn. R. Civ. P. 5A, requiring that any
constitutional challenge to a state statute specifically state the constitutional question and that notice be given to
the Minnesota Attorney General. See Barrett v. Barrett, 2009 WL 4251133 at *6 (Minn. Ct. App. 2009)
(procedurally barring constitutional challenge for lack of notice to the Minnesota Attorney General).
16
§ 549.09 requires ten-percent interest on all judgments and awards greater than
$50,000 entered on or after August, 1, 2009
The plain language of Minn. Stat. § 549.09 requires that Steven Bormann pay interest at a
rate of ten percent on the judgment from the commencement of the action.
If the words of a statute are clear and unambiguous, then those words shall not be
disregarded in pursuit of something more. Minn.Stat. § 645.16. On May 15, 2009, § 549.09
subdiv. 1(c)(2) was amended to read: “[f]or a judgment or award over $50,000, the interest rate
shall be ten percent per year until paid.” The effective date provision for this amendment states:
“[t]his section is effective August 1, 2009, and applies to judgments and awards finally entered
on or after that date.” 2009 Minn. Laws, ch. 83, art. 2, § 35. This language is clear and
unambiguous. For judgments or awards over $50,000, finally entered on or after August 1, 2009,
the applicable interest rate is ten percent per year until paid.
The Clear And Unambiguous Language Of § 549.09 Overcomes The General
Presumption Against Retroactivity
Steven Bormann argues that interpreting § 549.09 to apply to interest accruing prior to
August 1, 2009, would be a retroactive application of the statute. The clear language within the
effective date provision is sufficient to overcome the general presumption against statutory
retroactivity.
“No law shall be construed to be retroactive unless clearly and manifestly so intended by
the legislature.” Minn. Stat. § 645.21. Despite this statutory presumption against retroactivity,
statutes may be applied retroactively if the legislature clearly desires to apply a law to pending
cases. Chatman v. Speedway Superamerica LLC, 2008 WL 4705089 at 3 (Minn. Ct. App. 2008)
(citing Marose v. Maislin Transp., 413 N.W.2d 507, 511-12 (Minn. Ct. App. 1988). Multiple
legislative language combinations have been held to overcome the anti-retroactivity
17
presumption. See e.g Gomon, 645 N.W.2d at 416-19 (the language, “[the statute of limitations
extension] is effective August 1, 1999, and applies to actions commenced on or after that date,”
is sufficient to overcome the presumption against retroactivity and applies to claims arising prior
to the amendment) (emphasis added); Lessard v. Milwaukee Ins. Co., 496 N.W.2d 852, 855
(Minn. Ct. App. 1993) (section 549.09, the section at issue in this case, applied retroactively
when the legislature wrote “[section 549.09 is] effective July 1, 1991, and appl[ies] to
proceedings pending on or commenced on or after that date.”).
The language in section 549.09 is similar to the statutory language examined in Gomon
and Lessard. Both cases examined statutory language that had an effective date followed by
language that applied the amended statute to a situation that would not have otherwise been
included within the statute’s reach. The legislature did the same thing here; listing the effective
date, and then applying the amended statute to “judgments and awards finally entered on or after
[the effective date].” This language would serve no purpose if the legislature was not clearly
conveying its intent to apply the amended statute to actions arising prior to the effective date
with judgments or awards entered after. See Vlahos v. R&I Const. of Bloomington, Inc., 676
N.W.2d 679 (Minn. 2004) (citation omitted) (A court must presume that no statutory language is
superfluous.). If this was not the legislature’s intent, it simply could have refused to add
modifying language, and the amendment would not have applied to pre-verdict interest accruing
prior to the effective date.
The amended statute applies to judgments and awards entered on or after August 1, 2009.
The judgment in this case will be entered after August 1, 2009. The new interest rate applies to
judgments and awards in excess of $50,000. The judgment in this case exceeds $50,000. Thus,
the ten-percent interest rate applies in this case.
18
C. Defendants’ Offer of Judgment was Insufficient to Stop the Accrual of
Interest Under § 549.09
Pursuant to § 549.09, interest shall be awarded from the commencement of the action
until judgment is entered. If, however, the non-prevailing party served a written offer of
settlement that was closer to the judgment than any counteroffer, interest shall cease accruing on
the date of the offer. Id. at subd. 1(b). The offer must remain open for thirty days. Id.
Defendants served Plaintiff with a written Offer of Judgment referencing only Minnesota
Rule of Civil Procedure 68.01. A Rule 68 Offer of Judgment is served for the purpose of shifting
responsibility for costs and disbursements. See Minn. Stat. § 68.03. It is irrevocable for ten
days. Minn. Stat. § 68.02(a).
The Minnesota Court of Appeals has held that an Offer of Judgment made “expressly and
solely under Rule 68” is not a valid settlement offer under § 549.09. See A & L Potato Co., Inc.
v. Aggregate Industries, 759 N.W.2d 57, 59-60 (Minn. Ct. App. 2009). Steven Bormann
attempts to distinguish this case by claiming that the offer was communicated to Plaintiff both
before and after the written offer. Despite that, however, Defendants’ written Offer of Judgment
was only legally irrevocable for ten days. See Minn. Stat. § 68.02(a). Steven Bormann cannot
now claim that the Offer was irrevocable for some longer period of time. A settlement offer
under § 549.09 must remain open for thirty days and any Offer of Judgment that references only
Rule 68 with no other indication of firm irrevocability for thirty days is insufficient to stop
preverdict interest from accruing. See A & L Potato, 759 N.W.2d at 59-60 (“We conclude that
the limited duration of an offer made solely under Rule 68 precludes it from being a valid offer
under § 549.09, subd. 1(b).”).
Defendants’ Rule 68 Offer of Judgment was insufficient to stop preverdict interest from
accruing under § 549.09, and interest must be calculated on the entire judgment.
19
III. PLAINTIFF IS THE ONLY PARTY ENTITLED TO REASONABLE COSTS AND
DISBURSEMENTS
A. Plaintiff is Entitled to Reasonable Costs and Disbursements
The prevailing party in district court is entitled to reasonable and necessary costs and
disbursements. Minn. Stat. § 549.04; See Stinson v. Clark Equipment Co., 473 N.W.2d 333, 338
(Minn. Ct. App. 1991) (“In the final analysis, costs and disbursements allowed must be both
reasonable and necessary.”).
Attached to his Motion for Entry of Judgment, Plaintiff submitted a Bill of Costs and
Disbursements totaling $14,422.44. The disputed items on this list include Plaintiff’s costs for:
(1) legal research; (2) travel and lodging; (3) miscellaneous costs such as photocopying, longdistance
calls, etc.; and (4) witness fees for three police officers.
Legal Research
Plaintiff seeks online legal research fees of $1,096.22, and fees from the University of
Minnesota for $190.00. Steven Bormann argues that the fees are unnecessary, and that any
research could have been done without incurring these fees.
Attached to his Bill of Costs, Plaintiff submitted a list of fees incurred using Westlaw and
Lexis, totaling $1096.22. This case did not involve significant legal issues, and no information
was given other than the date, amount, and source of the fee. Without more information, the
Court cannot determine the reasonableness or necessity of the fee, and it will not be allowed.
The University of Minnesota charges include four articles on the effects following
electrical injuries. While potentially helpful, these charges are not reasonable and necessary.
General information on electrical injuries could have been obtained through free sources, and
specific information about this case could have been, and in fact was, learned while deposing the
doctors. This cost will not be allowed.
20
Travel and Lodging
Listed on his Bill of Costs, Plaintiff seeks his attorneys’ mileage for a pre-trial hearing
and trial and lodging for the trial. The Court finds this amount unreasonable and unnecessary.
In support of these costs, Plaintiff cites Cargill, Inc. v. Lone Star Technologies, Inc., 2005
WL 1514631 (Minn. Ct. App. 2005). Cargill simply holds that the costs associated with
traveling for out-of-state depositions may be taxed. This case is distinguishable. Unlike being
forced to travel out of state for depositions, Plaintiff’s attorneys agreed to take this case knowing
it would be filed in Douglas County. Minnesota does not recognize mileage for attorneys as a
reasonable disbursement. Olean v. Pomeroy, 2009 WL 511757 at *9 (Minn. Ct. App. 2009).
The same can be said for lodging. Plaintiff’s counsel knew trying this case would require travel
to Douglas County. Out of convenience, they stayed in a hotel. These costs are unreasonable in
the context of recovery from a defendant.
Miscellaneous Costs
This Court has the discretion to award miscellaneous costs such as photocopying, longdistance
phone calls, and FAX charges. See Stinson, 473 N.W.2d at 338. To do so, the Court
must be convinced of the reasonableness and necessity of those charges. Id.
Plaintiff attached a four-page list of charges, providing the type of charge (e.g.
“photocopy charges”), the amount, and the date of occurrence. Given that neither the facts nor
law of this case were particularly contested, the Court cannot find that these charges are
reasonable or necessary without information as to what exactly is being billed. See Olean, 2005
WL 511757 at *10 (holding that awarding FAX charges rests on whether there is sufficient
information to determine the reasonableness of the charges). Without more information, this
Court cannot determine the reasonableness of Plaintiff’s photocopying, telephone, FAX, and
21
Federal Express charges, and will not award these costs. The Court will award $25 for the Court
Administrator FAX fee.
Witness Fees
Plaintiff has requested taxation of witness fees for three police officers, totaling $597.00.
Steven Bormann objects, claiming that Deputies Brad Lake and Jeff Beck’s testimony was
irrelevant and meaningless, and that Deputy Kevin Wiseman’s witness fees should be disallowed
because he did not testify.
To tax costs for an unsworn witness, it is the party seeking the costs who must present
facts showing the necessity and materiality of the witness’s testimony. Merchants’ State Bank v.
St. Anthony & Dakota Elevator Co., 104 N.W. 713 (Minn. 1905). Because Deputy Wiseman did
not testify, and no facts were given regarding his potential testimony, the Court cannot determine
the necessity of this cost, and it shall not be taxed.
As to Deputies Lake and Beck, both testified, and both added some minimal value to the
jury in understanding the sequence of events and Plaintiff’s general condition. As such, witness
fees for Deputies Lake and Beck are allowed.
B. Although Nicholas Bormann and LHD are Prevailing Parties, They are not
Entitled to Costs
As an initial matter, Plaintiff argues that Nicholas Bormann and LHD are not prevailing
parties. The Court finds that they are indeed prevailing parties.
In determining who is a prevailing party, “‘the general result should be considered, and
inquiry made as to who has, in the view of the law, succeeded in the action.’” Borchert v.
Maloney, 581 N.W.2d 838, 840 (Minn. 1998). By finding Nicholas Bormann and LHD’s fault
less than Plaintiff’s, the jury determined that they are not liable to Plaintiff. Having no liability,
they are clearly prevailing parties.
22
Despite being prevailing parties, Nicholas Bormann and LHD are not entitled to costs.
The Court acknowledges the longstanding rule that a trial court shall not deny costs to a
prevailing party. See Minn. Stat. § 594.04 (“In every action in a district court, the prevailing
party…shall be allowed reasonable disbursements paid or incurred.”). However when a
prevailing party’s costs are indivisible from that of a non-prevailing party, and were expended
for the benefit of both, this Court finds that it would be inappropriate to award costs.
All three defendants were represented by the same attorney. All costs were expended on
behalf of all three defendants. There were no costs expended on behalf of Nicholas Bormann or
LHD that were not also expended on behalf of Steven Bormann. All costs sought by Nicholas
Bormann and LHD would have been incurred by Steven Bormann regardless if there were any
other defendants. Although a district court does not have the right to deny costs to a prevailing
party, the practical effect of awarding Nicholas Bormann and LHD costs would be that Steven
Bormann, the lone non-prevailing party, would receive his costs for being held liable to Plaintiff.
Such an absurd result cannot have been intended by the legislature when enacting § 594.04. As
such, the Court cannot award Nicholas Bormann or LHD costs.

STATE OF MINNESOTA IN DISTRICT COURT
COUNTY OF DOUGLAS SEVENTH JUDICIAL DISTRICT
Dennis Larson, Court File No.: 21-CV-09-620
Plaintiff,
v.
Le Homme Dieu Cabin Rentals LLC, FINDINGS OF FACT, CONCLUSIONS
Roy Anderson, Nicholas Bormann, OF LAW, ORDER FOR JUDGMENT,
and Steven Bormann, AND JUDGMENT
Defendants.
A jury trial in this matter was held before the Honorable David R. Battey on November
30, 2010. The jury returned its verdict on December 2, 2010. Plaintiff filed a Motion for Entry
of Judgment on January 5, 2011. A telephone hearing was held with the Honorable David R.
Battey on March 28, 2011. This matter was taken under advisement on March 28, 2011.
PARTIES AND COUNSEL
Plaintiff, Dennis Larson, was represented by attorney Robert J. Shainess and Richard
Snyder of Fredrickson & Byron, P.A.
Defendants were represented by attorney Frank Rajkowski of Rajkowski Hansmeier, Ltd.
FINDINGS OF FACT
On December 2, 2010, the jury returned its Special Verdict form. The Court incorporates
the following Special Verdict questions and answers as Findings of Fact. The Special Verdict
included answers to questions No. 1 through 11, as follows:
1. Was Defendant Steven Bormann negligent?
Yes ___X___ No _______
2. If you answered “Yes” to Question 1, please answer this question: was Steven Bormann’s
negligence a direct cause of the event that led to Dennis Larson’s injury?
Yes ___X___ No _______
2
3. Was Defendant Nicholas Bormann negligent?
Yes __ X__ No _______
4. If you answered “Yes” to Question 3, please answer this question: was Nicholas
Bormann’s negligence a direct cause of the event that led to Dennis Larson’s injury?
Yes ___X__ No _______
5. Was Defendant Le Homme Dieu Cabin Rentals LLC, not including any negligence by
Dennis Larson in his capacity as President/Chief Manager of Le Homme Dieu Cabin
Rentals LLC, negligent?
Yes ___X___ No _______
6. If you answered “Yes” to Question 5, please answer this question: was Le Homme Dieu
Cabin Rental’s negligence a direct cause of the event that led to Dennis Larson’s injury?
Yes _______ No ___X___
7. Was Plaintiff Dennis Larson negligent either personally or in his capacity as
President/Chief Manager of Le Homme Dieu Cabin Rentals?
Yes ___X___ No _______
8. If you answered “Yes” to Question 7, please answer this question: was Dennis Larson’s
negligence a direct cause of the event that led to his injury?
Yes ___X___ No _______
9. Taking all of the negligence that contributed as a direct cause of harm or injury to Dennis
Larson as 100%, what percentage of the negligence do you attribute to:
Steven Bormann ___60__%
Nicholas Bormann ___10__%
Le Homme Dieu Cabin Rentals ___5___%
Dennis Larson ___25__%
TOTAL 100%
3
10. What amount of money will fairly and adequately compensate Dennis Larson for past
damages he sustained as a result the July 2, 2006 event, up to the date of this verdict for:
a) Medical expenses of every kind $ 21,312.79
b) Pain, disability, disfigurement,
embarrassment, and emotional distress $ 110,000.00
11. What amount of money will fairly and adequately compensate Dennis Larson for
damages reasonably certain to occur in the future as a result of the July 2, 2006 event for:
a) Pain, disability, disfigurement,
embarrassment, and emotional distress $ 0
12. Plaintiff’s reasonable costs and disbursements include:
Statutory Costs $200.00
Filing Fees $525.00
Service Fees $643.00
Expert Witness Fees $4,616.00
Witness Fees $513.00
Mediation $962.50
Miscellaneous Costs $25.00
Deposition Costs $2,400.20
Medical Records and Exhibits $1,109.84
Total $10,994.54
CONCLUSIONS OF LAW
1. Plaintiff is not entitled to recover against either Nicholas Bormann or Le Homme Dieu
Cabin Rentals LLC. Both are entitled to a Judgment of dismissal.
2. Plaintiff’s total damages are $131,312.79. Plaintiff is entitled to recover 75% of those
damages, which equals $98,484.59. Steven Bormann is jointly and severally liable to Plaintiff
for $98,484.59 before interest and costs and disbursements.
3. Plaintiff is entitled to pre-verdict interest on $98,484.59 at a rate of 10% per year from
the commencement of the action on June 26, 2008. Plaintiff is entitled to $ _________ as preverdict
interest.
4
4. Together with the above damages and interest, Plaintiff’s Judgment against Steven
Bormann shall include Plaintiff’s reasonable costs and disbursements in the amount of
$10,994.54.
5. This Court has not addressed any collateral offset issues. Defendant Steven Bormann
originally filed a motion to reduce Plaintiff’s recovery pursuant to Swanson v. Brewer, however
that motion was withdrawn.
ORDER FOR JUDGMENT
LET JUDGMENT BE ENTERED ACCORDINGLY.
It is so ordered upon this ______ day of ________________, 2011.
______________________________
Hon. David R. Battey
Judge of District Court
JUDGMENT
The Conclusions of Law as set forth herein shall be deemed the Judgment filed herein.
Dated this ______ day of _______________, 2011.
_______________________________________
Douglas County Court Administrator
5
MEMORANDUM
Plaintiff Dennis Larson brings this Motion for Entry of Judgment following a trial in
which a jury awarded him $23,312.791 for medical expenses and $110,000 for past pain,
disability, disfigurement, embarrassment, and emotional distress. Plaintiff argues that because
the jury attributed some fault to each of the three defendants, that Minn. Stat. § 604.02 applies,
and Defendant Steven Bormann is jointly and severally liable for the entire amount less the
percentage attributed to Plaintiff. Alternatively, Plaintiff argues that even if Minn. Stat. § 604.02
does not apply, the result is the same. Steven Bormann argues that Minn. Stat. § 604.02 does not
apply because Plaintiff’s fault exceeds that of all but one defendant, and that Steven Bormann
should be severally liable for the percentage of fault attributed to him.
Second, Plaintiff contends that pre-verdict interest should be applied at a ten-percent
interest rate to the entire judgment. Steven Bormann argues that no pre-verdict interest should be
awarded on the past pain damages because the damages were not ascertainable. Further, Steven
Bormann contends that if interest is awarded, the ten-percent interest rate should not be
retroactive to the date of commencement of the action. Regardless, he argues that Defendants
made an Offer of Judgment of $50,000, and that any interest awarded should be based on that
amount, not the entire judgment.
Third, Plaintiff, as the prevailing party, seeks reasonable costs and disbursements. Steven
Bormann disputes some of Plaintiff’s Bill of Costs as unreasonable, but agrees that Plaintiff is a
prevailing party. Defendants Nicholas Bormann and Le Homme Dieu Cabin Rentals LLC
(“LHD”) also seek costs and disbursements because they were prevailing parties to the action.
1 This amount was stipulated to by the parties.
6
Facts
Plaintiff and Defendants Steven and Nicholas Bormann were members of a limited
liability company (“LLC”) that owned land and cabins on Lake Le Homme Dieu. Plaintiff was
the president of the LLC. Being on the water, the parties had boats and often took those boats on
the lake. The boats were stored on boat lifts attached to the dock. The Bormanns owned one of
these lifts. Their lift was electric, and to power it, they ran an electrical cord from one of the
cabins under the water to the boat lift.
On July 2, 2006, the three parties and their families were at the lake for Fourth of July
weekend. Sometime that evening, Steven Bormann took the families’ children on the lake in
Plaintiff’s boat. As Steven Bormann was navigating the boat back to shore, he ran over the cord
to the boat lift, creating an electric current in the water and electrifying the boat. When he
touched the side of the boat, he was electrocuted. Seeing Steven Bormann laying motionless in
the boat with children still aboard, Plaintiff jumped into the water and grabbed the boat. In doing
so, he was also electrocuted. After his grip released from the boat, Plaintiff ended up under
water for a significant period of time, almost drowning. Plaintiff suffered injuries as a result of
the events.
Plaintiff served Defendants with a Summons and Complaint on June 26, 2008. A jury
trial was held from November 30 to December 2, 2010. Following the trial, the jury attributed
fault in these percentages: Steven Bormann – 60%; Plaintiff – 25%; Nicholas Bormann – 10%;
LLC – 5%. They found that Plaintiff had suffered $110,000 in past pain and suffering damages,
but found no future damages. Past medical expenses were stipulated to by the parties. Plaintiff
now moves to enter judgment.
7
Analysis
I. DEFENDANT STEVEN BORMANN IS LIABLE FOR THE ENTIRE AWARD
LESS PLAINTIFF’S CONTRIBUTORY FAULT
Although Minn. Stat. § 604.02 is not applicable, Defendant Steven Bormann is liable
pursuant to Minn. Stat. § 604.01 for the entire award less the twenty-five percent attributed to
Plaintiff by the jury.
A. Minn. Stat. § 604.02 is not Applicable Because Only One Defendant is Liable
to Plaintiff
“When two or more persons are severally liable, contributions to awards shall be in
proportion to the percentage of fault attributable to each, except that the following persons
are jointly and severally liable for the whole award: (1) a person whose fault is greater
than 50 percent; [inapplicable exceptions].” Minn Stat. § 604.02.
At trial, the jury determined the parties’ fault as follows: Defendant Steve Bormann
– 60%; Plaintiff – 25%; Defendant Nicholas Bormann – 10%; LHD – 5%2. Plaintiff
argues that because Nicholas Bormann shares “a portion of the fault in causing the
accident that injured” Plaintiff, he is a severally liable person under Minn. Stat. § 604.02.
Staab v. Archdiocese of St. Cloud, 780 N.W.2d 392, 394 (Minn. Ct. App. 2010). The
Court is not persuaded.
2 An issue exists as to LHD’s attributed fault. The jury indicated on the special verdict form that LHD’s negligence
was not a direct cause of the event that led to Plaintiff’s injury. Despite being told to only take “all of the
negligence that contributed as a direct cause” into account when attributing fault, the jury found LHD five percent
at fault.
Steven Bormann argues that finding him severally liable cures this problem, while finding him jointly liable creates
a problem. The Court disagrees. The Special Verdict form specifically asked about Dennis Larson’s negligence
“either personally or in his capacity as President/Chief Manager of Le Homme Dieu Cabin Rentals.” In doing so,
any of the fault that could have been attributed to Dennis Larson because of his involvement in LHD has already
been decided. The 5% attributed to LHD by the jury must necessarily be the result of actions by other members of
the LLC, and Steven Bormann would remain jointly liable for that amount.
8
For Minn. Stat. § 604.02 to apply in this case, there must be two or more
defendants “severally liable.” A defendant is not subject to liability unless the jury
attributes a higher percentage of fault to him than to the plaintiff. See Minn. Stat. §
604.01; See e.g. Horton by Horton v. Orbeth, Inc., 342 N.W.2d 112 (Minn. 1984). Horton
involved a contribution claim by one defendant against two other defendants. Id. The
initial action resulted in a jury verdict similar to this case, whereby one defendant was
found 74% at fault, the plaintiff was found to be 10% at fault, and the other two
defendants were attributed fault of 8% each. Id. at 113. In affirming the district court’s
denial of the primary defendant’s contribution claim, the Minnesota Supreme Court
reasoned that “even though the jury found [defendants] negligent to some degree, neither
was negligent to a degree sufficient to impose liability to the injured party. We have
consistently refused to require a party to contribute to an award when the quality of his
conduct did not justify imposing liability to the injured party.” Id. at 114. Although this
is not a claim for contribution between defendants, Horton makes clear that a defendant
whose fault is less than that of the plaintiff’s is not liable to the plaintiff.
Nicholas Bormann and LHD were attributed less fault than Plaintiff. Under
Minnesota law, they are not liable to Plaintiff for damages he sustained.
Plaintiff relies primarily on Staab for the proposition Nicholas Bormann and LHD
are severally liable under Minn. Stat. § 604.02. 780 N.W.2d 392. At first glance,
Plaintiff’s argument is convincing; however, upon further examination of Staab, the Court
is not persuaded.
In Staab, the plaintiff, broke her leg after falling out of a wheelchair being pushed
by her husband. Id. at 393. The accident occurred on property owned by the St. Cloud
9
Diocese. Id. Staab sued the Diocese, but her husband was never named as a party. Id.
The jury returned a verdict for Staab, finding the Diocese and Staab’s husband each 50%
at fault. Id. The district court determined that Minn. Stat. § 604.02 did not apply, and
ordered the Diocese to pay 100% of the damages. Id. The Diocese appealed, arguing that
Minn. Stat. § 604.02 applied, and should only have been ordered to pay 50% of the
damages pursuant to the statute. Id. The Minnesota Court of Appeals agreed. The Court
analyzed the word “person” in the statute, concluding that a “person” is not simply a party
to the suit, “but any tortfeasor whose fault has been submitted to the jury.” Id.
Staab went on to state that the Diocese and Staab’s husband were “‘severally
liable’ because they were found to share a portion of the fault in causing the accident that
injured Respondent.” Id. This is the language upon which Plaintiff relies for his
contention that both Nicholas Bormann and LHD are severally liable. Staab, however,
was not examining the definition of “severally liable.” Both the Diocese and Staab’s
husband were found 50% at fault for Staab’s accident. Although Plaintiff is correct when
he points out that implicit in Staab is the holding that “severally liable” cannot mean
“legally obligated to pay the judgment,” Plaintiff is incorrect that “severally liable” must
then include everyone who has been attributed a percentage of fault, regardless of actual
or potential liability. Had Staab’s husband been named either a defendant or third-party
defendant, he would have been liable for his portion of the damages. The fundamental
difference in this case is that a jury absolved Nicholas Bormann and LHD of any liability,
both future and present, to the Plaintiff for his injuries. This Court cannot conclude that
Staab attempts, or even has the power, to change the longstanding rule that a defendant is
not liable when his attributed fault is less than the plaintiff’s.
10
Nicholas Bormann and LHD were found by the jury to have a lesser percentage of
fault than Plaintiff. Based on this finding, neither party is liable to Plaintiff. That leaves
only one party, Steven Bormann, liable to Plaintiff. Because Minn. Stat. § 604.02 only
applies when two or more persons are severally liable, the Court finds that this section is
not applicable.
B. Defendant Steven Bormann is Liable for 75% of Plaintiff’s Damages
Based on both common law and Minn. Stat. § 604.01, Steven Bormann is liable to
Plaintiff for the full amount of the damages less the 25% attributed to him by the jury.
A finding of contributory fault does not bar a plaintiff from recovering unless that
fault is greater than the fault of the person against whom recovery is sought. Minn. Stat. §
604.01. If, however, there is a finding of contributory fault, the plaintiff’s damages are
proportionally reduced by such fault. Id. The obvious corollary is that when there is only
one defendant whose fault exceeds the plaintiff’s, the defendant shall be liable for the
amount of damages reduced only by the plaintiff’s percentage of fault. Steven Bormann
argues that this longstanding principle no longer applies based on Minnesota’s shift
towards several liability, and that this Court should Order him liable only for the 60%
attributed to him by the jury.
Joint and several liability is governed by § 604.02. This Court has already
determined that § 604.02 does not apply. In fact, Steven Bormann argued the same.
Despite that, he also argues that the principles of joint and several liability, specifically
the presumption that a tortfeasor is liable only for the portion of fault attributed to him,
apply even when he is the only liable party. This Court disagrees.
11
Although there may have been a shift in the overall landscape of multiple-tortfeasor
liability from a presumption of joint liability to one of several liability, there has been no
change to either the statutory language or underlying rationale of § 604.01. § 604.01,
subd. 1, provides that a plaintiff may not recover from a person whose fault is found to be
less than the plaintiff’s, and that the damages recovered must be reduced by the
percentage of fault attributed to the plaintiff. Despite the significant legislative change in
2003 to § 604.02, the language of § 604.01, subd. 1, has remained substantively
unchanged since its inception. Had the legislature intended that § 604.01 be changed, it
could have easily added to the language of the section, requiring that the plaintiff’s
damages be further reduced by all non-liable parties found to have been at fault. See
Horton, 342 N.W.2d at 115-16 (“It would, perhaps, have been more consistent had the
legislature decreed that the damages be reduced in proportion to the aggregate fault of the
plaintiff and all less-at-fault parties, from whom the plaintiff cannot recover, but that is
not what the legislature did.”).
This case is almost identical to Jack Frost Inc. v. Engineered Bldg. Components
Co. 304 N.W.2d 346 (Minn. 1981). In Jack Frost, a jury found Defendant Hydro-Air
55% at fault, Plaintiff Jack Frost 30% at fault, and Defendant EBCO 15% at fault for Jack
Frost’s damages. Id. at 349. The district court ordered that Jack Frost pay 70% of the
damages3. Id. at 349. Hydro-Air appealed, contending that it should have only been
ordered to pay the 55% attributed to it by the jury. Id. In affirming the district court, the
Minnesota Supreme Court held:
Jack Frost’s causal negligence was not as great as Hydro-Air’s causal negligence.
Therefore, Jack Frost can recover damages from Hydro-Air. The extent of
Hydro-Air’s liability is not affected by the fact that only 55% of the causal
3 Total damages less the 30% attributed to the plaintiff
12
negligence was attributed to Hydro-Air. Jack Frost suffered an indivisible injury
as a result of its own negligence and that of EBCO and Hydro-Air. Hydro-Air is
therefore liable for the entire amount of Jack Frost’s damages diminished, as
section 604.01, subd. 1, requires, by 30%, the proportion of the causal negligence
attributed to Jack Frost.
Id. at 352. Jack Frost makes it clear that when there is only one liable party, that party is liable
for the entire amount of the damages less the percentage of fault attributed to the plaintiff.
Steven Bormann is the only liable party, thus he is obligated to pay the entire amount of the
damages less the 25% fault attributed to Plaintiff.
Policy does not dictate that this Court enter judgment against Steven Bormann
for only 60% of the damages.
Even if this Court accepted Steven Bormann’s arguments that several liability is now the
presumption in all cases, not just those with multiple tortfeasors under § 604.02, it still could not
be reasoned that Steven Bormann should be liable for only 60% of the damages. Steven
Bormann’s argument relies almost entirely on the 2003 legislative amendment to § 604.02,
arguing that changing presumptive liability between multiple tortfeasors from joint to several
evidences legislative intent to essentially eliminate all joint liability beyond the exceptions
enumerated in § 604.02. Even looking past the above-stated problems with that argument, the
legislature made clear when amending § 604.02 that it still intended for persons whose fault is
found to be greater than 50% to remain jointly and severally liable for all damages. See Minn.
Stat. § 604.02 (“except that the following persons are jointly and severally liable for the whole
award: (1) a person whose fault is greater than 50 percent.”). Steven Bormann was attributed
60% of the fault for Plaintiff’s injuries. There is simply no policy argument for limiting his
liability to that amount under either statutory provision.
13
II. PLAINTIFF IS ENTITLED TO PRE-VERDICT INTEREST AT A RATE OF TEN
PERCENT PER YEAR ON THE ENTIRE AWARD FROM THE
COMMENCEMENT OF THE ACTION
Minn. Stat. § 549.09 governs prejudgment and pre-verdict interest. Pursuant to Minn.
Stat. § 549.09, subd. 1(b), pre-verdict interest shall be awarded on pecuniary damages. As a
threshold issue, Plaintiff and Steven Bormann disagree as to whether “pecuniary damages”
include damages that are not ascertainable (e.g. pain and suffering damages).
Steven Bormann next argues that the 10% interest rate on judgments greater than $50,000
in subdivision (c)(2) should not apply before that provision was enacted. Finally, he argues that
even if the Court determines that interest is appropriate on unascertainable damages, that he
served a written offer of settlement pursuant to § 549.09, tolling interest accumulation. The
Court is not persuaded by Steven Bormann’s arguments.
A. Minn. Stat. § 549.09 Interest is Not Limited to Ascertainable Damages
The Minnesota legislature amended Minn. Stat. § 549.09 in 1984 (“the amendment”),
requiring pre-verdict interest on judgments and awards in certain circumstances. Prior to the
amendment, pre-verdict interest was awarded only on ascertainable damages. See Moosbrugger
v. McGraw-Edison Co., 170 N.W.2d 72, 82 (Minn. 1969) (“The general rule in this state is to
require interest in the case of a liquidated claim or a sum certain and not to allow interest in a
case of an unliquidated claim because a defendant does not know how much he owes until the
verdict is reached.”). Since the amendment, a Minnesota Supreme Court decision has directly
addressed the issue, holding that pre-verdict interest is awardable for all general damages, not
just those that are ascertainable. Lienhard v. State, 431 N.W.2d 861, 865 (Minn. 1988).
Confusing the issue, however, two diametrically opposing lines of cases from the Minnesota
14
Court of Appeals have arisen as to whether damages must still be ascertainable. Duxbury v. Spex
Feeds, Inc., 681 N.W.2d 380, 391 n.5 (Minn. Ct. App. 2004).
Because this Court finds that Lienhard’s language is not dicta, the Court relies on that
precedent to award pre-verdict interest on unascertainable damages.
Lienhard holds that damages no longer must be ascertainable
The Court first must first determine whether the on-point language in Lienhard is dicta,
as Steven Bormann argues. The Court finds that it is not.
Dicta are the court’s expressions which go beyond the particular facts of the case before
it. K.R. v. Sanford, 588 N.W.2d 545, 548 (Minn. Ct. App. 1996). The determination hinges on
whether the language was necessary to the court’s decision. Id. at 548-49. In Lienhard, the
court’s determination that pre-verdict interest is allowed “irrespective of a defendant’s ability to
ascertain the amount of damages for which he might be liable or to stop the running of interest,”
is necessary to the outcome. 431 N.W.2d at 865. As such, it is not dicta.
At issue in Lienhard was the State of Minnesota’s civil-liability tort cap. Id. at 863. A
jury found the State 50% at fault for Plaintiff’s $200,000 damages. Id. The State argued that the
tort cap limited costs, disbursements, and pre-verdict interest. Id. In analyzing the interest
portion, the Court stated that “section 549.09 was amended to allow pre-verdict interest
irrespective of a defendant’s ability to ascertain the amount of damages for which he might be
held liable or to stop the running of interest.” Id. at 865. The Court went on to hold that because
interest on unascertainable damages is not conventional interest on a sum of money, but rather an
attempt to provide full compensation by converting time-of-demand money into time-of verdict
money, it is simply an element of damages to be limited by the tort cap. Id.
15
Steven Bormann argues that the “irrespective of a defendant’s ability to ascertain”
language is dicta because it does not address the ultimate issue, the tort cap. This argument
misses the necessity of the determination that pre-verdict interest is awarded on unascertainable
damages. Without the initial determination that pre-verdict interest on unascertainable damages
is awardable, there would be no need to make a final determination as to whether pre-verdict
interest is limited by the tort cap. Because the Court’s determination that the ascertainability rule
no longer applies when awarding pre-verdict interest was essential to its holding, that language
was not dicta.
Further, both the Eighth Circuit and Minnesota Court of Appeals have adopted Lienhard
as precedent, holding that the language is indeed not dicta. Children’s Broadcasting Corp. v.
Walt Disney Corp., 357 F.3d 860, 869-70 (8th Cir. 2004); Myers v. Hearth Techs., Inc., 621
N.W.2d 787, 794 (Minn. Ct. App. 2001).
Lienhard’s language is not dicta, and this Court will follow its precedent. The
ascertainability rule no longer applies to pecuniary damages in § 549.09.
B. Interest Accrued at Ten Percent from Commencement of the Action4
This case presents an issue of statutory interpretation and a determination of whether
Minn. Stat. § 549.09’s amended interest rate applies to periods before the amendment’s effective
date.
§ 549.09’s clear and unambiguous language requires that Steven Bormann pay at a tenpercent
interest rate from commencement of the action.
4 The Court rejects any argument that the § 549.09’s amendment to set the interest on awards over $50,000 at
10% is unconstitutional. Steven Bormann failed to comply with Minn. R. Civ. P. 5A, requiring that any
constitutional challenge to a state statute specifically state the constitutional question and that notice be given to
the Minnesota Attorney General. See Barrett v. Barrett, 2009 WL 4251133 at *6 (Minn. Ct. App. 2009)
(procedurally barring constitutional challenge for lack of notice to the Minnesota Attorney General).
16
§ 549.09 requires ten-percent interest on all judgments and awards greater than
$50,000 entered on or after August, 1, 2009
The plain language of Minn. Stat. § 549.09 requires that Steven Bormann pay interest at a
rate of ten percent on the judgment from the commencement of the action.
If the words of a statute are clear and unambiguous, then those words shall not be
disregarded in pursuit of something more. Minn.Stat. § 645.16. On May 15, 2009, § 549.09
subdiv. 1(c)(2) was amended to read: “[f]or a judgment or award over $50,000, the interest rate
shall be ten percent per year until paid.” The effective date provision for this amendment states:
“[t]his section is effective August 1, 2009, and applies to judgments and awards finally entered
on or after that date.” 2009 Minn. Laws, ch. 83, art. 2, § 35. This language is clear and
unambiguous. For judgments or awards over $50,000, finally entered on or after August 1, 2009,
the applicable interest rate is ten percent per year until paid.
The Clear And Unambiguous Language Of § 549.09 Overcomes The General
Presumption Against Retroactivity
Steven Bormann argues that interpreting § 549.09 to apply to interest accruing prior to
August 1, 2009, would be a retroactive application of the statute. The clear language within the
effective date provision is sufficient to overcome the general presumption against statutory
retroactivity.
“No law shall be construed to be retroactive unless clearly and manifestly so intended by
the legislature.” Minn. Stat. § 645.21. Despite this statutory presumption against retroactivity,
statutes may be applied retroactively if the legislature clearly desires to apply a law to pending
cases. Chatman v. Speedway Superamerica LLC, 2008 WL 4705089 at 3 (Minn. Ct. App. 2008)
(citing Marose v. Maislin Transp., 413 N.W.2d 507, 511-12 (Minn. Ct. App. 1988). Multiple
legislative language combinations have been held to overcome the anti-retroactivity
17
presumption. See e.g Gomon, 645 N.W.2d at 416-19 (the language, “[the statute of limitations
extension] is effective August 1, 1999, and applies to actions commenced on or after that date,”
is sufficient to overcome the presumption against retroactivity and applies to claims arising prior
to the amendment) (emphasis added); Lessard v. Milwaukee Ins. Co., 496 N.W.2d 852, 855
(Minn. Ct. App. 1993) (section 549.09, the section at issue in this case, applied retroactively
when the legislature wrote “[section 549.09 is] effective July 1, 1991, and appl[ies] to
proceedings pending on or commenced on or after that date.”).
The language in section 549.09 is similar to the statutory language examined in Gomon
and Lessard. Both cases examined statutory language that had an effective date followed by
language that applied the amended statute to a situation that would not have otherwise been
included within the statute’s reach. The legislature did the same thing here; listing the effective
date, and then applying the amended statute to “judgments and awards finally entered on or after
[the effective date].” This language would serve no purpose if the legislature was not clearly
conveying its intent to apply the amended statute to actions arising prior to the effective date
with judgments or awards entered after. See Vlahos v. R&I Const. of Bloomington, Inc., 676
N.W.2d 679 (Minn. 2004) (citation omitted) (A court must presume that no statutory language is
superfluous.). If this was not the legislature’s intent, it simply could have refused to add
modifying language, and the amendment would not have applied to pre-verdict interest accruing
prior to the effective date.
The amended statute applies to judgments and awards entered on or after August 1, 2009.
The judgment in this case will be entered after August 1, 2009. The new interest rate applies to
judgments and awards in excess of $50,000. The judgment in this case exceeds $50,000. Thus,
the ten-percent interest rate applies in this case.
18
C. Defendants’ Offer of Judgment was Insufficient to Stop the Accrual of
Interest Under § 549.09
Pursuant to § 549.09, interest shall be awarded from the commencement of the action
until judgment is entered. If, however, the non-prevailing party served a written offer of
settlement that was closer to the judgment than any counteroffer, interest shall cease accruing on
the date of the offer. Id. at subd. 1(b). The offer must remain open for thirty days. Id.
Defendants served Plaintiff with a written Offer of Judgment referencing only Minnesota
Rule of Civil Procedure 68.01. A Rule 68 Offer of Judgment is served for the purpose of shifting
responsibility for costs and disbursements. See Minn. Stat. § 68.03. It is irrevocable for ten
days. Minn. Stat. § 68.02(a).
The Minnesota Court of Appeals has held that an Offer of Judgment made “expressly and
solely under Rule 68” is not a valid settlement offer under § 549.09. See A & L Potato Co., Inc.
v. Aggregate Industries, 759 N.W.2d 57, 59-60 (Minn. Ct. App. 2009). Steven Bormann
attempts to distinguish this case by claiming that the offer was communicated to Plaintiff both
before and after the written offer. Despite that, however, Defendants’ written Offer of Judgment
was only legally irrevocable for ten days. See Minn. Stat. § 68.02(a). Steven Bormann cannot
now claim that the Offer was irrevocable for some longer period of time. A settlement offer
under § 549.09 must remain open for thirty days and any Offer of Judgment that references only
Rule 68 with no other indication of firm irrevocability for thirty days is insufficient to stop
preverdict interest from accruing. See A & L Potato, 759 N.W.2d at 59-60 (“We conclude that
the limited duration of an offer made solely under Rule 68 precludes it from being a valid offer
under § 549.09, subd. 1(b).”).
Defendants’ Rule 68 Offer of Judgment was insufficient to stop preverdict interest from
accruing under § 549.09, and interest must be calculated on the entire judgment.
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III. PLAINTIFF IS THE ONLY PARTY ENTITLED TO REASONABLE COSTS AND
DISBURSEMENTS
A. Plaintiff is Entitled to Reasonable Costs and Disbursements
The prevailing party in district court is entitled to reasonable and necessary costs and
disbursements. Minn. Stat. § 549.04; See Stinson v. Clark Equipment Co., 473 N.W.2d 333, 338
(Minn. Ct. App. 1991) (“In the final analysis, costs and disbursements allowed must be both
reasonable and necessary.”).
Attached to his Motion for Entry of Judgment, Plaintiff submitted a Bill of Costs and
Disbursements totaling $14,422.44. The disputed items on this list include Plaintiff’s costs for:
(1) legal research; (2) travel and lodging; (3) miscellaneous costs such as photocopying, longdistance
calls, etc.; and (4) witness fees for three police officers.
Legal Research
Plaintiff seeks online legal research fees of $1,096.22, and fees from the University of
Minnesota for $190.00. Steven Bormann argues that the fees are unnecessary, and that any
research could have been done without incurring these fees.
Attached to his Bill of Costs, Plaintiff submitted a list of fees incurred using Westlaw and
Lexis, totaling $1096.22. This case did not involve significant legal issues, and no information
was given other than the date, amount, and source of the fee. Without more information, the
Court cannot determine the reasonableness or necessity of the fee, and it will not be allowed.
The University of Minnesota charges include four articles on the effects following
electrical injuries. While potentially helpful, these charges are not reasonable and necessary.
General information on electrical injuries could have been obtained through free sources, and
specific information about this case could have been, and in fact was, learned while deposing the
doctors. This cost will not be allowed.
20
Travel and Lodging
Listed on his Bill of Costs, Plaintiff seeks his attorneys’ mileage for a pre-trial hearing
and trial and lodging for the trial. The Court finds this amount unreasonable and unnecessary.
In support of these costs, Plaintiff cites Cargill, Inc. v. Lone Star Technologies, Inc., 2005
WL 1514631 (Minn. Ct. App. 2005). Cargill simply holds that the costs associated with
traveling for out-of-state depositions may be taxed. This case is distinguishable. Unlike being
forced to travel out of state for depositions, Plaintiff’s attorneys agreed to take this case knowing
it would be filed in Douglas County. Minnesota does not recognize mileage for attorneys as a
reasonable disbursement. Olean v. Pomeroy, 2009 WL 511757 at *9 (Minn. Ct. App. 2009).
The same can be said for lodging. Plaintiff’s counsel knew trying this case would require travel
to Douglas County. Out of convenience, they stayed in a hotel. These costs are unreasonable in
the context of recovery from a defendant.
Miscellaneous Costs
This Court has the discretion to award miscellaneous costs such as photocopying, longdistance
phone calls, and FAX charges. See Stinson, 473 N.W.2d at 338. To do so, the Court
must be convinced of the reasonableness and necessity of those charges. Id.
Plaintiff attached a four-page list of charges, providing the type of charge (e.g.
“photocopy charges”), the amount, and the date of occurrence. Given that neither the facts nor
law of this case were particularly contested, the Court cannot find that these charges are
reasonable or necessary without information as to what exactly is being billed. See Olean, 2005
WL 511757 at *10 (holding that awarding FAX charges rests on whether there is sufficient
information to determine the reasonableness of the charges). Without more information, this
Court cannot determine the reasonableness of Plaintiff’s photocopying, telephone, FAX, and
21
Federal Express charges, and will not award these costs. The Court will award $25 for the Court
Administrator FAX fee.
Witness Fees
Plaintiff has requested taxation of witness fees for three police officers, totaling $597.00.
Steven Bormann objects, claiming that Deputies Brad Lake and Jeff Beck’s testimony was
irrelevant and meaningless, and that Deputy Kevin Wiseman’s witness fees should be disallowed
because he did not testify.
To tax costs for an unsworn witness, it is the party seeking the costs who must present
facts showing the necessity and materiality of the witness’s testimony. Merchants’ State Bank v.
St. Anthony & Dakota Elevator Co., 104 N.W. 713 (Minn. 1905). Because Deputy Wiseman did
not testify, and no facts were given regarding his potential testimony, the Court cannot determine
the necessity of this cost, and it shall not be taxed.
As to Deputies Lake and Beck, both testified, and both added some minimal value to the
jury in understanding the sequence of events and Plaintiff’s general condition. As such, witness
fees for Deputies Lake and Beck are allowed.
B. Although Nicholas Bormann and LHD are Prevailing Parties, They are not
Entitled to Costs
As an initial matter, Plaintiff argues that Nicholas Bormann and LHD are not prevailing
parties. The Court finds that they are indeed prevailing parties.
In determining who is a prevailing party, “‘the general result should be considered, and
inquiry made as to who has, in the view of the law, succeeded in the action.’” Borchert v.
Maloney, 581 N.W.2d 838, 840 (Minn. 1998). By finding Nicholas Bormann and LHD’s fault
less than Plaintiff’s, the jury determined that they are not liable to Plaintiff. Having no liability,
they are clearly prevailing parties.
22
Despite being prevailing parties, Nicholas Bormann and LHD are not entitled to costs.
The Court acknowledges the longstanding rule that a trial court shall not deny costs to a
prevailing party. See Minn. Stat. § 594.04 (“In every action in a district court, the prevailing
party…shall be allowed reasonable disbursements paid or incurred.”). However when a
prevailing party’s costs are indivisible from that of a non-prevailing party, and were expended
for the benefit of both, this Court finds that it would be inappropriate to award costs.
All three defendants were represented by the same attorney. All costs were expended on
behalf of all three defendants. There were no costs expended on behalf of Nicholas Bormann or
LHD that were not also expended on behalf of Steven Bormann. All costs sought by Nicholas
Bormann and LHD would have been incurred by Steven Bormann regardless if there were any
other defendants. Although a district court does not have the right to deny costs to a prevailing
party, the practical effect of awarding Nicholas Bormann and LHD costs would be that Steven
Bormann, the lone non-prevailing party, would receive his costs for being held liable to Plaintiff.
Such an absurd result cannot have been intended by the legislature when enacting § 594.04. As
such, the Court cannot award Nicholas Bormann or LHD costs.