Prejudgment interest is a type of compensation payable to the plaintiff from the time the cause of action accrues until the time of the final judgment. Under Florida law, prejudgment interest is merely another element of pecuniary damages that is intended to make the prevailing party whole from the date of loss, once a finder of fact (judge or jury) has determined the amount of damages and defendant’s liability for same.
There are two lines of thought when it comes to prejudgment interest:
Prejudgment interest is a factor of damages often overlooked when negotiating a claim. A construction defect plaintiff’s claim for prejudgment interest can become an expensive element of damages because it can begin accumulating before construction defects are discovered. Thus, it is not uncommon for the prejudgment interest component of damages in complex construction defects cases to be half of the actual damages, especially in cases involving large community associations.
By the time the negotiation of a construction defect claim begins, it is often several years after a certificate of occupancy is issued. Thus, those who are contemplating the filing of a construction defect claim would be wise to seek legal counsel regarding the calculation of prejudgment interest. Parties need to analyze prejudgment interests as a significant element of damages, and this analysis can be useful when it comes to motivating defendants to settle cases before trial. To learn more contact Kristina Puente at kpuente@haber.law.
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