78B-3-414. Periodic payment of future damages in malpractice actions.
(1) In any malpractice action against a health care provider, as defined in Section
78B-3-403, the court shall, at the request of any party, order that future damages which equal or
exceed $100,000, less amounts payable for attorney fees and other costs which are due at the
time of judgment, shall be paid by periodic payments rather than by a lump sum payment.
(2) In rendering a judgment which orders the payment of future damages by periodic
payments, the court shall order periodic payments to provide a fair correlation between the
sustaining of losses and the payment of damages.
(a) Lost future earnings shall be paid over the judgment creditor's work life expectancy.
(b) The court shall also order, when appropriate, that periodic payments increase at a
fixed rate, equal to the rate of inflation which the finder of fact used to determine the amount of
future damages, or as measured by the most recent Consumer Price Index applicable to Utah for
all goods and services.
(c) The present cash value of all periodic payments shall equal the fact finder's award of
future damages, less any amount paid for attorney fees and costs.
(d) The present cash value of periodic payments shall be determined by discounting the
total amount of periodic payments projected over the judgment creditor's life expectancy, by the
rate of interest which the finder of fact used to reduce the amount of future damages to present
value, or the rate of interest available at the time of trial on one year U.S. Government Treasury
Bills.
(3) Before periodic payments of future damages may be ordered, the court shall require a
judgment debtor to post security which assures full payment of those damages. Security for
payment of a judgment of periodic payments may be in one or more of the following forms:
(a) a bond executed by a qualified insurer;
(b) an annuity contract executed by a qualified insurer;
(c) evidence of applicable and collectable liability insurance with one or more qualified
insurers;
(d) an agreement by one or more qualified insurers to guarantee payment of the
judgment; or
(e) any other form of security approved by the court.
(4) Security which complies with this section may also serve as a supersedeas bond,
where one is required.
(5) A judgment which orders payment of future damages by periodic payments shall
specify the recipient or recipients of the payments, the dollar amount of the payments, the
interval between payments, and the number of payments or the period of time over which
payments shall be made. Those payments may only be modified in the event of the death of the
judgment creditor.
(6) If the court finds that the judgment debtor, or the assignee of his obligation to make
periodic payments, has failed to make periodic payments as ordered by the court, it shall, in
addition to the required periodic payments, order the judgment debtor or his assignee to pay the
judgment creditor all damages caused by the failure to make payments, including court costs and
attorney fees.
(7) The obligation to make periodic payments for all future damages, other than damages
for loss of future earnings, shall cease upon the death of the judgment creditor. Damages
awarded for loss of future earnings may not be reduced or payments terminated by reason of the
death of the judgment creditor, but shall be paid to persons to whom the judgment creditor owed
a duty of support, as provided by law, immediately prior to his death. In that case the court
which rendered the original judgment may, upon petition of any party in interest, modify the
judgment to award and apportion the unpaid future damages in accordance with this section.
(8) If security is posted in accordance with Subsection (3), and approved by a final
judgment entered under this section, the judgment is considered to be satisfied, and the judgment
debtor on whose behalf the security is posted shall be discharged.
Renumbered and Amended by Chapter 3, 2008 General Session
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Last revised: Thursday, May 28, 2009