Supreme Court Rules That Developer Is Entitled To Prejudgment Interest From Port Authority

The Supreme Court of Ohio recently ruled that a Cincinnati-area port authority is subject to a state law that directs a party who breached a contract to pay an additional sum for delaying payment while the matter is disputed in court. In a 5-2 decision, the Supreme Court of Ohio ruled that the Port of Greater Cincinnati Development Authority may be required to pay nearly $350,000 in “prejudgment interest” to a developer working with the port authority on renovating Cincinnati’s downtown convention center.

In 2021, the Hamilton County Common Pleas Court ruled that the Port breached its contract with the development company Vandercar regarding the purchase and demolition of the Millennium Hotel in Cincinnati. As part of their legal action against the port authority, Vandercar sought prejudgment interest as it awaited payment from the Port. The trial court and the First District Court of Appeals ruled that the Port was immune from those types of penalties.

According to the majority opinion, Justice Patrick F. Fischer stated that the law that created the Port states that “no port authority is immune from liability” derived from the exercise of its duties. The state law that provides a party prejudgment interest for breach of contract provides no exception for a port authority, according to his opinion. The Supreme Court reversed the First District Court of Appeals ruling and remanded the case to the trial court for further proceedings.

Understanding the dispute 

According to the agreement, Vandercar had agreed to purchase the Millennium Hotel for $36 million. The developer then assigned ownership rights to the hotel to the Port. According to the agreement between Vandercar and the Port,, the developer would receive a $5 million development fee if the Port issued bonds to redevelop the hotel site. The Port did issue bonds but claimed the bonds were not for the redevelopment of the hotel, but for a separate phase of developing the convention center.

Vandercar promptly filed a breach of contract lawsuit in 2020 against the Port for failing to pay the redevelopment fee. Both sides requested summary judgment in their favor. In addition to requesting the $5 million fee, Vandercar also asked the trial court to provide prejudgment interest.

A year later, the court ruled that Vandercar was entitled to the redevelopment fee—but not the prejudgment interest. The trial court ruled that the Port was immune to paying prejudgment interest under Ohio’s sovereign immunity laws. Ultimately, Vandercar won the interest when the Supreme Court overturned the judgments of the lower courts.

Talk to a Columbus, OH Breach of Contract Attorney Today 

Kohl & Cook Law Firm, LLC represents the interests of parties in breach of contract disputes in Columbus and Dayton, OH. If another party has breached its contract with you, you may be entitled to damages. Call our Columbus consumer lawyers today to schedule an appointment, and we begin discussing your next moves immediately.