The Illinois Pre-Judgment Interest Act took effect in Illinois on July 1, 2021. (735 ILCS 5/2-1303). This law provides for prejudgment interest on all damages rendered in personal injury and wrongful death claims at the rate of 6 percent per year.
For any case pending at the time the Act went into effect on July 1, 2021, defendants were given one year from the effective date – until June 30, 2022 – to make a written settlement offer that will be used to lower the amount of interest.
- The Act has a provision that provides defendants an opportunity to reduce prejudgment interest through early settlement offers. The value of the settlement offer made within the first 12 months of the filing of a lawsuit is credited against the judgment amount rendered at trial before calculating the prejudgment interest to be paid. If that settlement offer meets or exceeds the judgment, no prejudgment interest would apply.
Therefore, for any cases pending when the Act went into effect on July 1, 2021, you now have 6 months to make a written settlement offer to the plaintiff. Be sure the offer is in writing as that is required by the Act.
- NOTE: If you attend a mediation or have oral settlement discussions that do not result in a settlement – be sure to follow-up those negotiations with a written offer so the offer complies with the Act.
For any case filed after the Act went into effect, the defendant has 1 year to make a written settlement offer.