Summary of a Recent
Judicial
Development in
Perishable Agricultural
Commodities Act
Court Denies Claims for Attorneys'
Fees and Interest
Bose EmelleNational AgLaw Center Graduate Assistant
Summary of Decision
In Nobles-Collier, Inc., v. Hunts Point Tomato Co. Inc., No. 02 Civ. 4128, No. 02 Civ. 5287, 2004 WL 102756 (S.D.N.Y. Jan. 22, 2004), the United States District Court for the Southern District of New York ruled that several perishable agricultural commodity suppliers could not recover contractually due interest and attorneys' fees.
Background
Several perishable agricultural commodity suppliers sought to recover attorneys' fees and interest incurred as a result of their effort to enforce their rights in the statute for trust created by the Perishable Agricultural Commodities Act, 7 U.S.C. §§ 499e- 499t. See id. at *1. All but one of the suppliers "'agreed to subordinate payment of any interest and attorneys' fees pending 100% payments of all principal amount of all valid PACA claims'." See id. at *2 (citation omitted). One of the suppliers objected to claims for interest not based on a contract. See id.
Analysis and Holdings
The court explained that ordinarily it "would be disposed to award contractually due interest and attorneys' fees . . ., and then exercise discretion in the case of non-contractual claims for interest." Id. It added the following:
Here, however, there appear to be insufficient trust assets available for the payment of all the valid claims against the PACA trust without any consideration of interest or attorneys' fees. While cognizant of the Ninth's Circuit decision in Middle Mountain Land & Produce Inc. v. Sound Commodities, Inc., 307 F.3d 1220 (9th Cir. 2002), the Court concurs in the reasoning with respect to interest . . . in Fishgold v. Onbank & Trust Co., 43 F.Supp.2d 346 (W.D.N.Y. 1999), and finds that the purposes of PACA and equity should be served by sustaining the objection to both interest and attorneys' fees on that ground, unless there remain distributable funds after all valid PACA claims . . . have been paid in full.
Id.
The case was decided on January 22, 2004; this summary was posted Feb. 16, 2005.