Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Feb 6, 2012

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If you are awarded a monetary amount in a court settlement, there are many situations in which you will be entitled to pre-judgment or post-judgment interest on the total. When this is allowed and how much the interest will be, as well as how it is calculated, will depend on the state in which you live, the type of judgment, and a variety of other factors.

Understanding Interest and Damage Awards

Many courts will offer pre-judgment interest or post-judgment interest, meaning that you may be entitled to collect interest on the amount due to you from the time period before the case was settled (pre-judgment) and/or from the time the case is settled to the time the settlement is actually paid to you (post-judgment). The exact time period at which interest begins to accrue is normally determined based on the type of case:

  • Typically, in a contract action, interest would be payable from the date the debt was due.
  • In an accident case, interest typically begins to run only after the judgment is entered.

In general, per federal law, any money judgment that is awarded in a civil court case and/or recovered in a district court is eligible for interest accrual. This interest will be dictated and can be collected by the state martial, and is typically added onto the total due by the judge at the time the settlement is officially handed down at the close of the case.

The exact amounts of pre-judgment interest and post-judgment interest awarded will vary, but will generally be decided by the court. The typical situation allows for an interest rate that matches that of the average one-year Treasury yield rate, based on the Federal Reserve system at the time of the judgment. 

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To understand all of the rules regarding your right to recover a civil judgment, speak to a lawyer who is familiar with the rules in your state.