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Nelson v. AmSouth Bank, N.A.
Citations: 622 So. 2d 894; 1993 Ala. LEXIS 624; 1993 WL 210780Docket: 1920720
Court: Supreme Court of Alabama; June 18, 1993; Alabama; State Supreme Court
Mary E. Nelson initiated a lawsuit against AmSouth Bank, claiming $35,000 which she alleged was negligently disbursed to Dorothy L. Davis from a joint account she shared with her deceased father, James W. Davis. Nelson asserted that the account included a right of survivorship, entitling her to the full balance upon her father's death. Frederick A. Marshall, the executor of James W. Davis's estate, intervened, disputing the existence of the right of survivorship and claiming half of the account's proceeds for the estate. The trial court ordered AmSouth to hold the funds pending resolution and later ruled in favor of Nelson. However, Marshall appealed, leading the Court to reverse the judgment, citing a lack of evidence for James Davis's intent to create a joint tenancy with survivorship, thus entitling the estate to half the funds. The current issue is whether the trial court erred in denying Nelson prejudgment interest on the $17,500 she was awarded. According to common law, prejudgment interest can be granted in noncontract cases where damages are calculable or established at a certain time. Nelson’s damages were disputed until the appellate decision clarified that the account did not have a survivorship right, thereby fixing her loss at $17,500. The Court found this situation comparable to previous rulings allowing prejudgment interest, emphasizing that once the account's status was determined, the amount owed could be easily calculated, justifying the award of prejudgment interest. Nelson is entitled to recover prejudgment interest at a rate of 6% on her half of the account proceeds, after deducting the interest earned while the proceeds were held by the circuit court clerk. This ruling is supported by Alabama case law, including Rhoden v. Miller, Burgess Mining, and Fletcher v. Tuscaloosa Federal Savings, which establish that in the absence of a controlling written contract, the legal rate for prejudgment interest is 6% per annum. The previous judgment that denied Nelson prejudgment interest is reversed, and the case is remanded for further proceedings consistent with this opinion. Notably, Nelson did not pursue damages from AmSouth for breach of contract, making Ala. Code 1975, § 8-8-8 inapplicable. This statute applies specifically to breach of contract cases, while tort actions, like Nelson's, follow common law rules for prejudgment interest. Although some dicta in Roe v. Brown suggest that § 8-8-8 might apply in tort cases, it should not be interpreted as establishing such applicability. The standards for awarding prejudgment interest in both contract and tort cases are similar, requiring that damages be certain or capable of being made certain.