State rate applies to FELA judgment.

Byline: Barbara L. Jones

Substantive law forms the pillars on the road to obtaining a judgment. In other words, the substantive issues in a case are embodied in a judgment.

That was what attorney Mark Bradford told the Minnesota Supreme Court last March when arguing the case of Alby v. BNSF Railway Co., a state court case under federal law. Judging from the Supreme Court's 5-2 decision on Wednesday, October 30, that was an effective metaphor. The court ruled that postjudgment interest is a matter of procedural, not substantive law, and that therefore the rate is determined by state law.

Whether the interest rate is procedural or substantive is a $320,000 question. The federal rate, which was applied by the lower courts, is 0.58 % annually. The state rate is 10%. It means that about $320,000 is added to the $1.5 million judgment against BNSF for an injury claim brought under the Federal Employers Liability Act.

The majority opinion was written by Justice Paul Thissen. Chief Justice Lorie Gildea joined a dissent written by Justice G. Barry Anderson.

Bradford said the decision is significant but not new or novel. "It simply confirms what all other courts to consider the issue have concluded: that a state post-judgment interest statute does not and cannotinterfere with substantive FELA rights because it applies only after those rights have been fully determined and reduced to judgment. Post-judgment interest has nothing to do with regulating a railroad's conduct. It is not additional liability for being a negligent railroad; rather, it is simply a cost of being a judgment debtor. We are pleased that the Court recognized this important distinction."

Attorneys for the railroad could not be reached for comment

Judgment creditor remedy

The federal statute provides a remedy to worker's injured by the railroad's negligence. It provides for concurrent jurisdiction in state and federal courts. When a FELA case is brought in state court, federal law governs the parties' substantive rights but state court practices and procedures apply.

Postjudgment interest is procedural in nature for FELA purposes, said the court, although the distinction between the two types of law is not always clear cut. But the court determined that the postjudgment interest did not so affect the proper measure of FELA damages that it unduly interferes with the substantive FELA right.

"This result makes sense because entry of judgment defines and settles the scope of substantive...