The Illinois legislature amended the state’s Code of Civil Procedure to permit nine percent prejudgment interest in all personal injury and wrongful death actions
Prejudgment interest begins to accrue on the date the defendant has notice of the injury
Local public entities are excluded from the prejudgment interest requirement
On January 13, 2021, the Illinois legislature amended the Illinois Code of Civil Procedure to permit nine percent prejudgment interest in all actions for the recovery of personal injury and wrongful death. Local public entities are excluded from the prejudgment interest requirement. Prejudgment interest will begin to accrue “on the date the defendant has notice of the injury from the incident itself or a written notice.” As to existing cases and personal injuries or deaths which occurred before the effective date of the statute, prejudgment interest will begin to accrue on the effective date of the statute or the date upon which the tortfeasor received notice of the injury.
The passage of this prejudgment interest amendment—which Illinois Governor J.B. Pritzker is likely to sign—is another significant setback to the fair administration of civil justice in the state. Prior to the delaying effects of the current pandemic, most Illinois venues were already known for substantial delays in getting personal injury lawsuits to trial or judgment. This amendment will only encourage the plaintiffs’ bar to delay filing in the hopes of escalating the amount of the recovery. No doubt Illinois businesses and professionals will be substantially affected by the expense and impact of this statute.
As a practical matter, defendants and insurance companies should resist any immediate efforts by plaintiff’s attorneys to add prejudgment interest as a line item to any settlement demand. Prejudgment interest will only be assessed if the case is taken to verdict and judgment. Unfortunately, in those few cases that do go to trial and judgment, prejudgment interest will add an extra penalty onto judgments for plaintiffs.
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