Dictionary 872 (1986). But this definition leaves the question of what is a year?
There are a wide variety of definitions of year. One definition is most precise, "a division in time equal to about 365 days, 5 hours, 48 minutes, and 46 seconds, representing the interval between one vernal equinox and the next." Webster's Encyclopedia Unabridged Dictionary of the English Language 1654 (1989). This is commonly known as a calendar year but more accurately termed a solar year. Id. This common definition appears to be what the Seventh Circuit intended although this definition is not exclusive.
This court, on the other hand, adopted the 360 day bank year for interest calculation. The Seventh Circuit did not comment on the propriety of this conclusion or how it should be applied. An argument could be made that by specifying "per annum," the appellate court intended a calendar year to apply, as the foregoing discussion reveals. However, as neither party objected to this court's use of the 360 day bank year for interest calculations in this round of briefing based on the Seventh Circuit's opinion, any objections to its use are waived.
II. Interest Calculation
No cases discuss the use or conflict between the calendar and bank years. P.I.L., in its reply brief, cited Thorndike Encyclopedia of Banking and Financial Tables (3d ed. 1989) ("Thorndike"). The following excerpt shows that Thorndike has grappled with the problem faced by this court: "A Year. The basis year for calculating interest may be 360 days, 365 days, or, in the case of leap year, 366 days . . . The most commonly used basis year, however, is 360 days." Thorndike at 10-1.1. Thorndike sets forth a formula which the court believes provides the best solution to the prejudgment interest calculation problem.
Stated mathematically, the formula is:
Interest = Principal x Rate x Time
The principal is $ 21,748,577. The rate set by the Seventh Circuit was 12.31% or .1231.
Time is somewhat problematic. Exactly 4514 days pass between March 16, 1978 and July 24, 1990 (counting the day the ship went down and the day of the judgment as a whole day). Four thousand three hundred eighty-four days pass between the first and the twelfth anniversaries of the sinking. One hundred and thirty days pass between the twelfth anniversary and the date of the judgment. Thorndike explains, however, that,
the time factor is the fraction of a year during which money earns interest. In the computation of daily interest, the time factor is expressed as a fraction in which the number of days between dates is the numerator and the basis year is the denominator. The time factor for 1 year may be any one of the following: 360/360, 365/360, 366/360, 365/365, 366/365, or 366/366.
Thorndike, at 11-1.1. Using a 360 day year as the court previously determined it must, the end result is prejudgment interest in the amount of $ 33,569,738.
This is what P.I.L. wants.
P.I.L.'s formulation of the equation is one of the alternatives specified by Thorndike. However, the math nets them a rate above 12.31%. P.I.L.'s annual factorial in a non-leap year would be 365/360. But the per annum rate of return of 12.31% in such a case would pay interest on five more days than the annum of 360 days as defined by the court. Therefore, the rate of return on their involuntary investment would be more than 12.31% because interest is paid on five more days. The real rate of return, then, is actually higher than 12. 31%.
Any such result would not comport with the mandate of the Seventh Circuit which clearly said that the rate was to be 12.31%. Cadiz, 954 F.2d at 1335, 1337.
The court must strive to apply a real rate of return of 12.31%. The only way to achieve a real rate is to use the same definition for annum as used in formulating the percentage return itself. Thus the number of days in a year must be the same for both. In this case, a year has been judicially determined to be 360 days, not more or less. Therefore, a real rate of return of 12.31% can be accomplished only be using the 360 day year and assuming that no days exist after December 26. No other method works and complies with all orders of both courts.
Thus, the amount of interest is calculated as follows:
Year Principal Rate Time Interest
1 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
2 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
3 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
4 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
5 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
6 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
7 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
8 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
9 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
10 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
11 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
12 $ 21,748,577 .1231 (360/360) $ 2,677,249.83
13 $ 21,748,577 .1231 (130/360) $ 966,784.66
TOTAL PREJUDGMENT INTEREST $ 33,093,782.62
If the court were to use the actual number of days as the numerator and denominator of the time fraction (365/365 or 366/366), the result would be the same for the first twelve annums. And, the last 130 days would earn $ 13,243.63 less interest than under the court's calculation (Principal x Rate x (130/365)). The method employed by this court best comports with the mandate of the Seventh Circuit. By applying the 360 day year to the judgment, the court applies a real rate of return of equal to that specified by the Seventh Circuit during the first twelve years.
The remaining 130 days in the term are calculated on that same basis, using 360 days as the denominator in the Time fraction. This nets a return of exactly 12.31% in the first twelve years. In the last 130 days P.I.L. gets a little extra. But when balancing the equities, the court must favor the involuntary creditor and the injured party, P.I.L.. Cadiz, 954 F.2d at 1332.
Prejudgment interest is awarded to P.I.L. in the amount of $ 33,093,782.62.
In its response, Amoco argues that P.I.L. has failed to meet its burden on a motion for reconsideration to "clearly establish either a manifest error of law or fact or . . . present newly discovered evidence." FDIC V. Meyer, 781 F.2d 1260, 1268 (7th Cir. 1986) (motion to alter or amend judgment). Likewise, P.I.L. has made no effort to show that the court abused its discretion in the computation of prejudgment interest. Cf. Amsted Industries Inc. v. National Castings, Inc., 1990 U.S. Dist. LEXIS 16657, 1990 WL 205878 at 3 (N.D. Ill. Dec. 7, 1990) (calculation of prejudgment interest left to discretion of district court). Thus, P.I.L.'s motion for reconsideration should be denied.
The court has again reviewed the arguments of P.I.L. Motions for reconsideration serve a limited function. Keene Corp. v. Int'l Fidelity Ins. Co., 561 F. Supp. 656, 665 (N.D. Ill. 1983). They are ordinarily granted only to correct clear errors of law or fact or to present newly discovered evidence which could not have been adduced during the pendency of the motion. Publishers Resource v. Walker-Davis Publications, 762 F.2d 557, 561 (7th Cir. 1985); Refrigeration Sales Co. v. Mitchell-Jackson, Inc., 605 F. Supp. 6 (N.D. Ill. 1983).
Motions for reconsideration cannot be used to introduce new legal theories for the first time, to raise legal argumentation which could have been heard during the pendency of the Previous motion, Publishers Resource, 762 F.2d at 561; In re Sisson, 668 F. Supp. 1196 (N.D. Ill. 1987), or to present evidence that could have been adduced during the pendency of the original motion. Keene Corp., 561 Supp. at 665. Finally, motions to reconsider are not at the disposal of parties who want to "rehash" old arguments. Refrigeration Sales, 605 F. Supp. at 7.
There is no reasonable basis in fact or law for the court to reconsider, amend, or modify its order of April 14, 1992.
The motion of P.I.L. is denied. Prejudgment interest is awarded to P.I.L. in the amount of $ 33,093,782.62.
IT IS SO ORDERED.
CHARLES RONALD NORGLE, SR., Judge
United States District Court