First Substitute S.B. 69

Senator Stephen H. Urquhart proposes the following substitute bill:


             1     
PREJUDGMENT INTEREST REVISIONS

             2     
2014 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Stephen H. Urquhart

             5     
House Sponsor: ____________

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill requires that in order for a plaintiff to receive prejudgment interest, the
             10      plaintiff shall have tendered an offer of settlement.
             11      Highlighted Provisions:
             12          This bill:
             13          .    requires a plaintiff to have tendered an offer of settlement before claiming
             14      prejudgment interest on a verdict;
             15          .    provides that prejudgment interest is only calculated from the date of a qualifying
             16      offer;
             17          .    sets limits on the award of prejudgment interest based upon the offer of settlement
             18      amount vis-a-vis the verdict amount;
             19          .    sets the percentage rate the court shall use to calculate prejudgment interest at one
             20      percentage point above the prime rate; and
             21          .    sets 5% and 10% as the limits on the rate the court uses.
             22      Money Appropriated in this Bill:
             23          None
             24      Other Special Clauses:
             25          None


             26      Utah Code Sections Affected:
             27      AMENDS:
             28           78B-5-824 , as last amended by Laws of Utah 2009, Chapter 276
             29     
             30      Be it enacted by the Legislature of the state of Utah:
             31          Section 1. Section 78B-5-824 is amended to read:
             32           78B-5-824. Personal injury judgments -- Interest authorized.
             33          (1) In all actions brought to recover damages for personal injuries sustained by any
             34      person, caused by the negligence or willful intent of another person, corporation, association,
             35      or partnership, and whether the injury was fatal or otherwise, the plaintiff in the complaint may
             36      claim interest on special damages [actually] incurred from the date of the occurrence of the act
             37      giving rise to the cause of action.
             38          [(2) It is the duty of the court, in entering judgment for plaintiff in that action, to add to
             39      the amount of special damages actually incurred that are assessed by the verdict of the jury, or
             40      found by the court, prejudgment interest on that amount calculated at 7.5% simple interest per
             41      annum, from the date of the occurrence of the act giving rise to the cause of action to the date
             42      of entering the judgment, and to include it in that judgment.]
             43          (2) A plaintiff seeking to recover damages for personal injury or wrongful death may
             44      claim prejudgment interest if for cases classified as tier 1, pursuant to the Utah Rules of Civil
             45      Procedure, the plaintiff tenders:
             46          (a) a written settlement demand; and
             47          (b) the amount of the demand does not exceed 1-1/3 of the amount of the judgment
             48      eventually awarded at trial.
             49          (3) A defendant may preclude a plaintiff's right to recover any prejudgment interest on
             50      a tier 1 claim, as defined by the Utah rules of Civil Procedure, by tendering a written settlement
             51      offer no later than 90 days after the defendant has received the claimant's written settlement
             52      demand, or no later than 60 days after the claimant has filed initial disclosures, whichever time
             53      frame comes last, and the offer is at least 2/3 of the amount of the judgment award.
             54          (4) Any prejudgment interest shall be computed as simple interest accruing from the
             55      date of the occurrence.
             56          (5) For special damages occurring in successive years, prejudgment interest shall be


             57      calculated from January 1 of each year special damages occurred. The court shall calculate
             58      prejudgment interest using a per annum rate, which is two percentage points above the prime
             59      rate, as published by the Board of Governors of the Federal Reserve System on the first
             60      business day in January of the calendar year in which the judgment is entered, although the
             61      prejudgment interest rate applied may not be lower than 5% or higher than 10%.
             62          (6) Cases classified as tier 2 or tier 3 by the Utah Rules of Civil Procedure may not be
             63      subject to the requirements outlined in Subsections (2) and (3).
             64          (7) For special damages occurring in successive years, prejudgment interest shall be
             65      calculated from January 1 of each year special damages occurred. Upon judgment, the court
             66      shall calculate prejudgment interest on special damages for cases classified as tier 2 or tier 3 by
             67      the Utah Rules of Civil Procedure on a per annum rate which is two percentage points above
             68      the prime rate, as published by the Board of Governors of the Federal Reserve System on the
             69      first business day in January of the calendar year, although the prejudgment interest rate may
             70      not be lower than 5% or higher than 10%.
             71          [(3)] (8) As used in this section, "special damages actually incurred" does not include
             72      damages for future medical expenses, loss of future wages, or loss of future earning capacity.


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