Lawyers in a personal injury or wrongful death lawsuit know that reaching a settlement or verdict in their case requires significant human and financial resources and patience while cases wind their way through the civil justice system. In January, the Illinois General Assembly passed a bill that should limit delays and encourage wrongdoers to seek early resolution of meritorious claims.
In late March, the Governor vetoed the bill, but a revised bill with a 6% interest rate was submitted, has been approved by the state legislature and was sent back to the Governor for his signature. This time there is reason for optimism, as opposition diminished with a lower but still seen as a meaningful rate of interest.
An annual prejudgment interest rate has long been recognized as a fair means of balancing the interests of those entitled to recovery in the justice system and those responsible for paying compensation—typically insurance and corporate defendants. The absence of such a measure encourages delay.
Some 46 other states have a form of prejudgment interest in recognition of the many benefits of these statutes. The benefits include helping reduce congestion of civil litigation dockets, incentivizing timely resolution of meritorious claims, and recognizing the time value of money.
The law entitles a plaintiff to collect prejudgment interest if his or her case goes to trial and a judge or jury finds in his or her favor. Because 97% of all cases settle, the reality is that prejudgment interest will be imposed only in a fraction of cases and not imposed at all on claims against municipalities or on settlements.