October 30, 2024

DSB saved a Long Island Town over $100,000 in connection with payments owed to a contractor. The Town had terminated the contract amid, among other things, claims that it was underpaying its workers. The contractor sued and a court determined how much was owed up to the termination date, but the Town then received a restraining notice from the Department of Labor related to the contractors’ workers’ unpaid wage claims. The contractor litigated extensively with the Department of Labor over those claims and various others and, eventually, worked out a settlement with the Department of Labor. Then, they sought to collect money was owed by the Town, plus fifteen years of interest. The Town challenged the obligation to pay interest, and the trial-level court agreed that, under the unique circumstances, the vast majority of the interest should be waived. The contractor appealed, but the Appellate Division agreed, explaining that ordinarily interest automatically accrues on a judgment by statute, but in this case it was appropriate for the Court to exercise its equitable discretion to cancel or toll the accrual of interest because the delay in in payment had been due to the contractors’ own wrongful conduct.