New Illinois Law Allows Plaintiffs to Collect Pretrial Interest
When an injured victim files a personal injury claim, their hope is that the case will be resolved quickly and they'll get the money they need as soon as possible. But that's not always the case. Sometimes, if the case has to go to trial, it can take several years for a verdict to be reached, and for the plaintiff (the injured party) to receive their money. In situations like this, pretrial interest can be requested. When a client has been injured in an accident and their case has to go to court, it's rare for the timeline of the injury case
to move quickly. Because of this, some states allow the injured victim's attorney to seek additional compensation for the undesirable waiting period that was out of the control of the client. This is known as pre-judgment interest (or pretrial interest), and in most states, it amounts to 6% interest on the money awarded by the court during the waiting period.
Illinois Joins Other States in Allowing Pretrial Interest in Personal Injury Cases
In late May 2021, Illinois Governor J.B. Pritzker signed a law
that allows for plaintiffs (the injured party) to collect pretrial interest on money awarded in personal injury and wrongful death lawsuits. This signing comes after Pritzker vetoed a previous version of the law earlier this year because it allowed for 9% interest instead of the now allowed 6%. The new amendment (Senate Bill 72
) grants plaintiffs 6% pretrial interest on money awarded to them in personal injury and wrongful death lawsuits. Before this new law was passed, Illinois already had a law regarding interest on verdicts. But that law only allowed plaintiffs to receive 9% interest from the time the court awarded the money to the time the payment was received. This new law allows plaintiffs to receive interest on their money from the time the lawsuit is filed to the time the court awards them their verdict. To put it into simpler language, an injured victim can now collect 6% interest on the money they win in court, starting from the time they are injured or find out they are injured until the time they get paid. So if it takes 2 years to get their money because of delay tactics by the opposing attorneys, the injured person will also be awarded interest for those 2 years on any money they were awarded.
A Few Things to Know About Illinois' Pretrial Interest Law
- It should be noted that the pre-judgment interest only applies to cases that go to verdict. So if your case takes a long time but is settled before it goes to trial, you are not entitled to any interest.
- The new law goes into effect on June 21, 2021.
- The prejudgment interest would begin to accrue on the date the lawsuit is filed and would continue to accrue for up to 5 years on all damages including future lost wages, future medical expenses, and pain and suffering. It does not include punitive damages, sanctions, attorney fees, and costs.
- This law does not apply to local public entities, which includes lawsuits against a county, city, village, township, school district, district, authority, municipal corporation, or any other political subdivision.
- For lawsuits filed before the law goes into effect, interest will start to accrue on the bill’s effective date.
What Proponents and Critics Have to Say About the New Law
Proponents of the pretrial interest law say that it will encourage insurance companies, defendants, and their attorneys to settle with plaintiffs out of court or to settle as soon as possible. Every moment that they purposefully drag their feet, it'll be costing the defendant money. One of the bill's supporters—the Illinois Trial Lawyers Association—says the bill will protect the injured and expedite the resolution of cases by encouraging defendants to settle early or litigate fast. This means victims with serious injuries will have to wait less time to get the money they so desperately need to rebuild their lives Critics say that the new law will dramatically increase litigation costs on manufacturers, hospitals, and doctors, who are usually defendants in these types of cases. They also claim that the bill will inflate settlements which will get passed on to consumers. However, if they paid or offered what was fair within a reasonable amount of time, they could avoid the extra costs of going to court and the interest penalties after verdict. For the latest up-to-date legal news, helpful articles, and insights into personal injury topics, visit Abels & Annes' blog.