Bill Text: MN SF530 | 2011-2012 | 87th Legislature | Chaptered

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Bill Title: Civil action verdicts, awards, and judgments interest computation modification

Spectrum: Partisan Bill (Republican 5-0)

Status: (Vetoed) 2012-02-13 - Veto message laid on table [SF530 Detail]

Download: Minnesota-2011-SF530-Chaptered.html

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CHAPTER 121--S.F.No. 530

An act

relating to civil actions; regulating interest on verdicts, awards, and
judgments;amending Minnesota Statutes 2010, section 549.09, subdivisions 1, 2.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

    Section 1. Minnesota Statutes 2010, section 549.09, subdivision 1, is amended to read:
    Subdivision 1. When owed; rate. (a) When a judgment or award is for the recovery
of money, including a judgment for the recovery of taxes, interest from the time of
the verdict, award, or report until judgment is finally entered shall be computed by the
court administrator or arbitrator as provided in paragraph (c) and added to the judgment
or award.
(b) Except as otherwise provided by contract or allowed by law, preverdict,
preaward, or prereport interest on pecuniary damages shall be computed as provided
in paragraph (c) from the time of the commencement of the action or a demand for
arbitration, or the time of a written notice of claim, whichever occurs first, except as
provided herein. The action must be commenced within two years of a written notice of
claim for interest to begin to accrue from the time of the notice of claim. If either party
serves a written offer of settlement, the other party may serve a written acceptance or a
written counteroffer within 30 days. After that time, interest on the judgment or award
shall be calculated by the judge or arbitrator in the following manner. The prevailing
party shall receive interest on any judgment or award from the time of commencement
of the action or a demand for arbitration, or the time of a written notice of claim, or as
to special damages from the time when special damages were incurred, if later, until the
time of verdict, award, or report only if the amount of its offer is closer to the judgment or
award than the amount of the opposing party's offer. If the amount of the losing party's
offer was closer to the judgment or award than the prevailing party's offer, the prevailing
party shall receive interest only on the amount of the settlement offer or the judgment or
award, whichever is less, and only from the time of commencement of the action or a
demand for arbitration, or the time of a written notice of claim, or as to special damages
from when the special damages were incurred, if later, until the time the settlement offer
was made. Subsequent offers and counteroffers supersede the legal effect of earlier offers
and counteroffers. For the purposes of clause (2), the amount of settlement offer must
be allocated between past and future damages in the same proportion as determined by
the trier of fact. Except as otherwise provided by contract or allowed by law, preverdict,
preaward, or prereport interest shall not be awarded on the following:
(1) judgments, awards, or benefits in workers' compensation cases, but not including
third-party actions;
(2) judgments or awards for future damages;
(3) punitive damages, fines, or other damages that are noncompensatory in nature;
(4) judgments or awards not in excess of the amount specified in section 491A.01;
and
(5) that portion of any verdict, award, or report which is founded upon interest, or
costs, disbursements, attorney fees, or other similar items added by the court or arbitrator.
(c)(1) For a judgment or award of $50,000 or less or a judgment or award for or
against the state or a political subdivision of the state, regardless of the amount, The
interest shall be computed as simple interest per annum. The rate of interest shall be based
on the secondary market yield of one year United States Treasury bills, calculated on a
bank discount basis as provided in this section.
On or before the 20th day of December of each year the state court administrator
shall determine the rate from the one-year constant maturity treasury yield for the most
recent calendar month, reported on a monthly basis in the latest statistical release of the
board of governors of the Federal Reserve System. This yield, rounded to the nearest one
percent, or four percent, whichever is greater, shall be the annual interest rate during the
succeeding calendar year. The state court administrator shall communicate the interest
rates to the court administrators and sheriffs for use in computing the interest on verdicts
and shall make the interest rates available to arbitrators.
This clause applies to any section that references section 549.09 by citation for the
purposes of computing an interest rate on any amount owed to or by the state or a political
subdivision of the state, regardless of the amount.
(2) For a judgment or award over $50,000, other than a judgment or award for or
against the state or a political subdivision of the state, the interest rate shall be ten percent
per year until paid.
(3) When a judgment creditor, or the judgment creditor's attorney or agent, has
received a payment after entry of judgment, whether the payment is made voluntarily by
or on behalf of the judgment debtor, or is collected by legal process other than execution
levy where a proper return has been filed with the court administrator, the judgment
creditor, or the judgment creditor's attorney, before applying to the court administrator
for an execution shall file with the court administrator an affidavit of partial satisfaction.
The affidavit must state the dates and amounts of payments made upon the judgment after
the most recent affidavit of partial satisfaction filed, if any; the part of each payment that
is applied to taxable disbursements and to accrued interest and to the unpaid principal
balance of the judgment; and the accrued, but the unpaid interest owing, if any, after
application of each payment.
(d) This section does not apply to arbitrations between employers and employees
under chapter 179 or 179A. An arbitrator is neither required to nor prohibited from
awarding interest under chapter 179 or under section 179A.16 for essential employees.
(e) For purposes of this subdivision:
(1) "state" includes a department, board, agency, commission, court, or other entity
in the executive, legislative, or judicial branch of the state; and
(2) "political subdivision" includes a town, statutory or home rule charter city,
county, school district, or any other political subdivision of the state.
(e) This section does not apply to a judgment or award upon which interest is entitled
to be recovered under section 60A.0811.
EFFECTIVE DATE.This section is effective August 1, 2012, and applies to
judgments and awards entered on or after that date.

    Sec. 2. Minnesota Statutes 2010, section 549.09, subdivision 2, is amended to read:
    Subd. 2. Accrual of interest. (a) During each calendar year, interest shall accrue
on the unpaid balance of the judgment or award from the time that it is entered or made
until it is paid, at the annual rate provided in subdivision 1 or paragraph (b). The court
administrator shall compute and add the accrued interest to the total amount to be collected
when the execution is issued and compute the amount of daily interest accruing during the
calendar year. The person authorized by statute to make the levy shall compute and add
interest from the date that the writ of execution was issued to the date of service of the writ
of execution and shall direct the daily interest to be computed and added from the date of
service until any money is collected as a result of the levy.
(b) For a judgment or award over $50,000, other than a judgment or award for or
against the state or a political subdivision of the state, the interest rate is ten percent per
year. This paragraph does not apply to a section that references section 549.09 by citation
for the purpose of computing an interest rate on any amount owed to or by the state or a
political subdivision of the state, regardless of the amount.
EFFECTIVE DATE.This section is effective August 1, 2012, and applies to
judgments and awards entered on or after that date.