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By: Jonathan Schwartz and Patrick Eckler
Judge Marcia Maras of the Circuit Court of Cook County struck down as violative of the Illinois state constitution, PA 102-0006, which permits prejudgment interest in personal injury and wrongful death cases. This ruling is of great significance for those with cases that predate the statute’s effective date, July 1, 2021. So, if your case was filed more than one year ago, be sure to confer with your claim representative, defense counsel, and/or coverage counsel and discuss whether you should make a qualified settlement offer if you have not already done so.
Recall that the statute:
1. Sets the rate of prejudgment interest at 6% per annum (although prejudgment interest does not apply to punitive damages, sanctions, statutory attorneys’ fees, statutory costs and any amount less than the highest timely written oﬀer).
2. Cuts oﬀ interest at ﬁve years in all events.
3. Tolls the running of interest in the event of a voluntary dismissal.
4. Includes a mechanism for settlement oﬀers that if a defendant does better at trial than an oﬀer made within a certain time prior to trial, prejudgment interest is unavailable altogether.
5. Provides that interest would only run from the date of the ﬁling of the complaint (and then only against that portion of the award above the amount of the highest timely written oﬀer).
6. Carves out public entities from being subject to prejudgment interest.
The case at issue is Hyland v. Advocate Health and Hospitals Corp. et al., No. 2017-L-3541. After finding the dispute ripe because interest was accruing against the defendants prior to judgment, Judge Maras held that the statute violated the Illinois State Constitution’s guarantee of a trial by jury. In the court’s view, damages are to be decided by juries – not legislators. Notably, the court also held that the statute was special legislation in violation of the Constitution, and the legislation failed to pass muster under both a strict scrutiny and rational basis analysis. Also notably, the court did not reach three additional arguments advanced by the defendants: 1) the statute violated constitutional separation of powers, 2) the constitutional requirement that the bill must be read three times by each chamber of the General Assembly, and 3) the constitutional requirement that the bill concern a single issue.
Pursuant to Illinois Supreme Court Rule 302(a)(1), appeal of this judgment will be directly to the Illinois Supreme Court, but only after a final judgment is entered. Since Judge Maras’ ruling was not a final judgment, Hyland must proceed to trial before there may be an appeal. It thus is currently unknown when the Supreme Court will have an opportunity to decide the appeal of Judge Maras’ order.
In the meantime, for cases filed before July 1, 2021, defendants had (or perhaps still have) until July 1, 2022 to make qualified settlement offers. And for cases filed after July 1, 2021, the defendants have one year from the date of filing to make such offers. Given the current state of limbo over and uncertainty about the applicability of the ruling by a circuit court judge to cases other than that before that court, defendants should tread carefully.
Should you have questions about the current litigation climate in Illinois, in general, and in Cook County and the “Collar Counties” in the Chicagoland area, in particular, please do not hesitate to contact us. Our lawyers in Illinois stand ready to offer counsel on these issues and more.
Please contact Donald Patrick Eckler, Jonathan L. Schwartz, Evan C. Jones, and Colleen L. Foster for more information.