Illinois Gov. JB Pritzker has vetoed Illinois House Bill 3360,
which sought to amend the state’s judgment interest statute to
add prejudgment interest on all damages rendered in personal injury
and wrongful death claims at the rate of 9 percent per year. (See
Holland & Knight’s previous alert, “Illinois Legislature Passes Bill to Impose
Prejudgment Interest on Personal Injury Claims,” Jan. 28,
2021.) In vetoing the measure on March 25, 2021, the governor
expressed concern about the statute’s potentially adverse
impact on Illinois’ healthcare industry, particularly given the
impact of COVID-19 on that sector of the Illinois economy.

Had the bill become law, it would have provided for the
calculation of prejudgment interest to begin accruing when the
tortfeasor had notice of the injury and would have had an immediate
impact on cases pending in the courts of Illinois.

After the veto, Illinois lawmakers passed a new version of the
bill under Senate Bill 72, which lowers the prejudgment interest
rate to 6 percent, has passed both chambers and now awaits Gov.
Pritzker’s signature.

This Holland & Knight alert summarizes the effect of Senate
Bill 72 if and when the bill becomes law.

Background

To date, Illinois law has not recognized the award of
prejudgment interest in tort actions for personal injury or
wrongful death. Instead, Illinois’ judgment interest statute
currently imposes only post-judgment interest in tort actions that
accrues at the rate of 9 percent per year after a court issues a
judgment. See 735 ILCS 5/2-1303.

Application and Effect

Senate Bill 72 seeks to amend the Illinois judgment interest
statute to provide that in all actions for personal injury or
wrongful death, with certain exceptions as detailed below, a
plaintiff shall recover prejudgment interest on all damages
rendered in a judgment against a tortfeasor at an interest rate of
6 percent per year. Prejudgment interest would apply only in
personal injury and wrongful death cases that reach verdict. It
would not apply to punitive damages, sanctions and attorney fees,
or court costs added to a judgment.

Senate Bill 72 sets the beginning of the accrual of prejudgment
interest on the date that a lawsuit is filed against the
tortfeasor. The proposed amended bill would become effective on
June 21, 2021. For any claims that occurred before the effective
date, prejudgment interest shall begin on the date the action is
filed or the effective date of the bill, whichever is later.

Senate Bill 72 also includes a provision that provides
defendants with an opportunity to reduce prejudgment interest
through early settlement offers. The value of settlement offers
made within the first 12 months of the filing of a lawsuit are to
be credited against the judgment amount rendered at trial before
calculating prejudgment interest, and if that settlement offer
meets or exceeds the judgment, no prejudgment interest will
apply.

Finally, the proposed law would not apply to lawsuits filed
against the state, a local unit of government, a school district,
community college district or any other governmental entity.

Conclusion

If signed into law by Gov. Pritzker, this important change to
the Illinois judgment interest statute would mark the first time
that prejudgment interest will be allowed against tortfeasors for
certain personal injury or wrongful death upon the entry of a
judgment.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

Something Interesting We Didn’t Know

Reed Smith

Sometimes we get an opinion back from a court, and the reasoning leaves us scratching our heads and wondering, “Where did that come from?” In the opinion, the court has decided the case on something that neither party ever argued.