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July 18, 2006

An old client comes in to you with a fender bender and, against your better judgment, you take it in.  Sure enough, you find that the other driver's insurance company is particularly nasty -- no names, but let's say theirs rhymes with "balls weight" -- and you're forced to try a case with a whopping $1700 in medical specials.  Sure, the jury gives you $6200, which is $3800 more than you were offered, but you're not satisfied:  in the spirit of "it's the principle of the thing," you file a motion for prejudgment interest.

And that perseverance puts an extra 600 bucks in your pocket -- well, $200 in yours, $400 in your client's -- because not only does the judge award you prejudgment interest, the court of appeals affirmed it a few weeks back in Sandifer v. Tighe.  The result isn't that surprising; the defendant kinda forgot to file the transcript of the hearing the trial court conducted on the issue.  For those of you unversed in appellate practice, your chances of showing that the lower court erred decline dramatically when you don't let the court of appeals in on what happened in the lower court.

The temptation to write off the result in Sandifer on that basis should be resisted, however, because the Court came to pretty much the exact same result five months ago in Szitas v. Hill  (the decision's now been reported at 165 OApp3d 439), holding that plaintiff was entitled to prejudgment interest where the specials had been $2200, the insurance company offered $3400, and the jury came back with $7500.

What's particularly noteworthy about Szitas is that the trial court had declined to award interest.  The appellate court's decision, then, was based on "abuse of discretion," which, loosely translated, means "we'll uphold the decision unless there was substantial evidence that the judge was foaming at the mouth when he rendered it."  For that reason, the trial court's decision is almost invariably affirmed.  But not here.

It's tempting to think that Szitas and Sandifer represent a trend, and in truth, there seems to be more of a tendency in the past couple of years for our court to affirm awards of prejudgment interest, as they did here, here, and here.  And there's some good arguments raised in them.  Last year in Meehan v. Johnsfor example, the court held prejudgment interest was appropriate where the defendant didn't concede the plaintiff's injury, but failed to obtain or present expert testimony refuting it.  This could put you in the driver's seat -- no pun intended -- if the insurance company doesn't get an "independent" medical examination but still contests the nature of the injury, which it almost invariably does.

Still, don't get carried away.  There are plenty of decisions which uphold denials of prejudgment interest, such as Ready v. Barfield, decided only a month before Sandifer.  The court in Ready decided that the plaintiff wasn't even entitled to a hearing on prejudgment interest, despite an offer of $3600 and a jury award of almost $10,000.  Then again, the plaintiffs had made a demand of $32,000, based largely on $15,000 in lost wages (as compared to an ER bill, $760 for physical therapy, and another $143 for prescriptions), so maybe the real conclusion in Ready was that if anybody wasn't evaluating the case realistically, it was the plaintiff.

The bottom line?  It depends on the judge, and it depends on the panel in the court of appeals.  Not that that's unusual, but probably more so here than in other situations.

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