The Indiana Court of Appeals upheld the trial court's award of prejudgment interest in a medical malpractice case earlier this month in Hupfer v. Miller, 2008 WL 2600021 (Ind. Ct. App. 2008). In Hupfer, a jury returned a verdict in favor of the Plaintiff for $75,000 against a podiatrist who was found liable for committing malpractice. Following the verdict, the Plaintiff filed a motion for prejudgment interest. The trial court granted the motion and awarded the plaintiff $24,000 after applying an interest rate of 8%.
The Indiana Court of Appeals affirmed the trial court's decision on appeal. In doing so, it stated that the initial award of prejudgment interest was made pursuant to the Tort Prejudgment Interest Statute ("TPIS") (or IC 34-51-4-1 et. seq.), which was enacted to "encourage settlement and to compensate the Plaintiff for the lost time value of money." Moreover, TPIS preempts comomon law prejudgment interest in tort cases.
On appeal, the Defendant argued that Plaintiff's written settlement offer did not comply with TPIS because it failed to specify the exact Plaintiff and Defendant to whom the offer applied. The Court disagreed stating the it was clear who the offer was directed at when the letter was sent from the individuals who filed the claim to the person whom the claim was filed against.
The Defendant also argued that the prejudgment award violated TPIS as it was more than one and one-third (1 1/3) the amount of the total judgment. The Court again disagreed explaining that the TPIS states the prejudgment interest award must not exceed one and one-thid the total amount of the judgment and in the case at hand the prejudgment interest award was exactly one and one-third.
Lastly, the Defendant unsuccessfully argued that the trial court erred in awarding prejudgment interest when it applied a prejudgment interest rate of 8%. The Court, however, noted that the TPIS allows a trial court to award a prejudgment interest rate of not less than 6% and no more than 10% per year. Consequently, the trial court was within its discretion to award 8%.