Contractual Provisions for Prejugdment Interest Are Enforceable
In Roodenberg v. Pavestone Company, L.P., 171 Cal. App. 4th 185 (2009), the California Court of Appeal held that section 3287(a) of the California Civil Code is inapplicable when prejudgment interest is expressly provided for in a contract. Thus, no showing of certainty regarding the amount of prejudgment interest due is required on the part of the defendant.
The general rule with respect to allowance of interest, when there is no contract to pay interest, is that the law awards interest upon money from the time it becomes due and payable if such time is certain and the sum is certain or can be made certain by calculation. Id. at 191 (citing Schmidt v. Waterford Winery, 177 Cal. App. 2d 28, 34 (1960)) (emphasis in original).
In this case, the contract clearly stated that when the sum became due, the defendant had 30 days to pay it. If unpaid after 30 days, interest accrued at the rate of one and a half percent per month. Therefore, the general rule regarding certainty is inapplicable.
