Compensation Awarded For “Loss of the Use of Money” Could Add Up to Millions in a Personal Injury Case
Settling or winning a personal injury lawsuit after an auto accident does not necessarily mean that an injured party gets the money very soon. If justice were swift, injured parties would receive a damages award immediately. But many plaintiffs must wait months or even years to be compensated for accident-related losses.
However, time is money. Particularly when interest is accruing in a personal injury case.
Colorado court reaffirms $3.6 million pre-judgment interest award.
Last month, the Colorado Court of Appeals affirmed a pre-judgment interest award of $3.6 million against Ford Motor Company in a case involving an allegedly defective driver’s seat. The hefty award was made on top of a previously granted verdict for damages of $2.9 million.
In 2009, a 1998 Ford Explorer was rear-ended by another motorist, causing the driver of the Explorer, Forrest Walker, to suffer neck and brain injuries. Walker successfully sued the driver who rear-ended him and then brought a product liability claim against Ford. In 2013, he was awarded $2.9 million in damages. But Ford appealed, seeking a new trial.
Ford was granted that new trial in 2015. But the result was the same, with the plaintiff again being awarded $2.9 million in damages in 2019. The plaintiff also won pre-judgment interest at a rate of nine percent for 10 years (i.e., from 2009, when the accident occurred, to 2019, when the second verdict was issued).
On appeal, Ford agreed that it owed interest on the judgment but argued that what it should owe is post-judgment interest, not pre-judgment interest, with interest accruing only from the date of the first appeal. But the court sided with the plaintiff.
Pre-Judgment and Post-Judgment Interest
Colorado law allows injured persons to collect both pre-judgment and post-judgment interest.
- Post-judgment interest compensates a party who prevails in a lawsuit but suffers a delay in receiving the damages award. Under Colorado’s interest-on-damages statute, post-judgment interest starts to run from the date of the court judgment until the date the money is actually paid to the plaintiff. This span includes the period during which an appeal is pending, and it compensates the plaintiff at the rate of nine percent, compounded annually.
- Pre-judgment interest may be awarded to successful plaintiffs to compensate for “loss of the use of money.” According to Colorado law, pre-judgment interest begins to accrue from the date of the injury at a rate of nine percent, compounded annually. Proponents argue that by penalizing defendants who drag out settlement negotiations, such awards encourage injury cases to be resolved more quickly.
The recent verdict by the Colorado Court of Appeals establishes a new precedent regarding interest on damages in personal injury cases. The verdict makes clear to plaintiffs free to settle a case outside of the courtroom that the risk of going to trial or appealing an unfavorable verdict may be greater than they had previously thought.
Contact an experienced Colorado personal injury attorney.
If you or a loved one has been injured in an accident, contact the Law Offices of Daniel R. Rosen online or call 303-454-8000 or 800-ROSEN-911 to schedule your free initial consultation with an experienced personal injury attorney today.