Pre-Judgment Interest Proposal

By Matthew J. Maddox

The Illinois State Bar Association, in a move stridently opposed by the defense bar, is including in its 2009/2010 Legislative Proposal a request that the Illinois Code of Civil Procedure be amended to allow for the award of pre-judgment interest in tort cases under certain circumstances.

The proposal provides:

A defendant may make a written offer of settlement to the plaintiff at any time after that defendant has entered an answer or other responsive pleading but no later than 120 days from that date. If the plaintiff does not accept that offer of settlement in writing within 30 days of his or her receipt of it, and the plaintiff’s award or judgment against that defendant is less than or equal to that offer of settlement, no prejudgment interest may be awarded against that defendant.

We believe this proposal is manifestly unfair to defendants and their insurers. The flaws (as argued by the Illinois Association of Defense Trial Counsel) include:

• Assesses pre-judgment interest if no “reasonable offer” made within 120 days of complaint. But this does not take into consideration that, in many if not most lawsuits, there is insufficient information within 120 days to fully assess the claim. This is often due to lack of diligence on the part of the plaintiff’s attorney and/or the plaintiff. Yet this proposal casts the penalty upon the defendant.
• Imposes prejudgment interest not only on past economic damages such as medical expenses or loss of income but also on future economic damages and on non-economic damages such as pain and suffering.
• Fails to impose any sort of penalty on a plaintiff who refuses a reasonable offer, only to have a jury award an amount equal to or less than the offer.

It is anticipated that a formal bill will be introduced before the Illinois General Assembly sometime this year. If that occurs, we will address this issue in a later issue of Quinn Quarterly and encourage organized opposition to passage of the bill.

Originally published in the Spring 2009 edition of Quinn Quarterly.