Prejudgment Interest Rules in Delaware
At a glance
| Governing law | Two different sources, not one dedicated prejudgment-interest statute. 6 Del. C. § 2301(a) is a general legal-interest-rate statute that Delaware courts have read, through case law, as supplying the rate for an ordinary prejudgment-interest award on a law claim (contract or ascertainable-damages tort) once the common-law right attaches. Section 2301(d) is a separate, narrower, purpose-built provision covering only a tort action for compensatory bodily-injury, death, or property-damage claims in Superior Court or the Court of Common Pleas. The Court of Chancery draws on neither: interest there rests on the court's own inherent equitable discretion |
|---|---|
| Interest rate | A floating rate: 5 percentage points over the Federal Reserve discount rate (including any surcharge), fixed as of the date from which interest is due: not the date of judgment or trial. A written contract's own stated rate displaces this default. The Court of Chancery isn't bound by § 2301(a) at all; it has 'broad discretion, subject to principles of fairness,' including the discretion to select a rate higher than the statutory one |
| When interest starts running | For a common-law (contract or ascertainable-damages) claim: the date payment became due, generally the date of breach for a contract claim. For a § 2301(d) tort claim that meets its settlement-demand condition: the date of injury, by the statute's own text, a materially earlier date than the common-law rule would otherwise use |
| Contract vs. tort claims | A contract or other calculable pecuniary loss uses the common-law matter-of-right rule; the precise amount may remain disputed until verdict. Bodily-injury/death tort claims use § 2301(d), requiring a written demand open at least 30 days for less than the eventual award. A blended verdict may retain contract interest even when § 2301(d) bars the tort route |
| Mandatory or discretionary | In Superior Court and the Court of Common Pleas, prejudgment interest is 'awarded ... as a matter of right and not of judicial discretion' once the common-law ascertainability threshold is met, and § 2301(d) itself says interest 'shall be added' once its settlement-demand condition is satisfied: both mandatory, not discretionary. The Court of Chancery is the opposite: whether to award interest at all, and at what rate, is left to the court's own equitable discretion, and interest is less likely to be awarded pre-judgment where the underlying claim is equitable in nature |
| Simple or compound | Simple interest is the default and the near-universal outcome for law claims in Superior Court and the Court of Common Pleas. The Court of Chancery has separate, broader discretion of its own, including 'the lesser authority to award compounding', but Delaware's Chancery Court has said it will typically award simple interest instead when the underlying claim could have been brought in Superior Court, denying compound interest in that situation |
| Claims against the government | Delaware's Tort Claims Act broadly immunizes the State and its officers or employees from any 'judgment, damages, penalties, costs or other money entitlement' for a discretionary official act performed in good faith without gross or wanton negligence; § 4011(a) separately immunizes local governmental entities from tort-damages suits except for enumerated statutory categories, capped at $300,000 per occurrence absent excess insurance. Sovereign immunity is separately waived only 'as to any risk or loss covered by the state insurance coverage program.' This survey found no case addressing whether § 2301's ordinary rules, or § 2301(d)'s settlement-demand mechanism, apply differently once a claim against a Delaware governmental entity clears this immunity threshold: an open question, not a located rule |
| Other exceptions | Common-law interest requires a pecuniary loss whose value is calculable, but not a sum fixed before verdict; bodily harm, emotional distress, and reputation damages fall outside that rule and must fit § 2301(d) when it applies. Punitive damages do not draw prejudgment interest. The claimant must request interest in the pleadings or at trial |
Requirements one by one
Governing law
Delaware splits this across two different kinds of authority rather than one dedicated statute. 6 Del. C. § 2301(a) is a general legal-interest-rate statute, it exists to cap loan interest and set a default lending rate, but Delaware courts have long applied its rate to an ordinary prejudgment-interest award once the common-law right to interest attaches on a law claim (a contract claim, or a tort claim for ascertainable damages like property damage). Section 2301(d) is a separate, much narrower provision that creates its own statutory prejudgment-interest right, but only for a tort action seeking compensatory damages for bodily injury, death, or property damage in Superior Court or the Court of Common Pleas, and only if the plaintiff met a specific pretrial settlement-demand condition. The Court of Chancery sits outside both: interest awarded there rests on the court's own inherent equitable authority, not on § 2301 at all.
Interest rate
The statutory rate under § 2301(a) floats: 5 percentage points over the Federal Reserve discount rate, including any surcharge, fixed as of the date from which interest is due, not the date of trial or judgment, and not today's discount rate. If the parties have a written contract that states its own interest rate, that rate controls instead. Section 2301(d) tort claims use this same § 2301(a) rate. The Court of Chancery isn't bound by any of this: it has "broad discretion, subject to principles of fairness," in fixing the rate it applies, including the discretion to pick a rate higher than the statutory one.
When interest starts running
For a common-law claim (contract, or ascertainable-damages tort), interest starts on the date payment became due, typically the date of breach for a contract claim. For a § 2301(d) tort claim that satisfies its settlement-demand condition, the statute itself sets an earlier trigger: the date of injury, not the date of breach, demand, or filing.
Contract vs. tort claims
This is where Delaware's split runs deepest. A contract claim, or another pecuniary loss whose value can be calculated from evidence, draws prejudgment interest as a matter of right at common law without a settlement-demand gate. Brandywine Smyrna makes clear that the precise amount need not be fixed until the verdict. A bodily-injury or death tort instead uses § 2301(d), which requires a written settlement demand valid for at least 30 days and lower than the eventual award. A blended verdict can retain its contract interest even if the tort portion fails that statutory condition.
Mandatory or discretionary
In Superior Court and the Court of Common Pleas, prejudgment interest on a law claim is squarely mandatory: Delaware's Supreme Court has said it is "awarded ... as a matter of right and not of judicial discretion" once the damages are ascertainable, and § 2301(d) itself uses mandatory language, interest "shall be added", once its settlement-demand condition is met. The Court of Chancery works the opposite way: whether to award interest at all, not just how much, is left to the court's own equitable discretion, and Chancery is generally less likely to award prejudgment interest where the underlying claim is equitable rather than legal in nature.
Simple or compound
Simple interest is the default, and the near-universal practical outcome, for a law claim in Superior Court or the Court of Common Pleas. The Court of Chancery has its own separate and broader discretion, including, as Delaware's courts have put it, "the lesser authority to award compounding", but Chancery has repeatedly said it will typically stick with simple interest, the Superior Court norm, when the underlying claim could have been brought in Superior Court instead of Chancery.
Claims against the government
Delaware's Tort Claims Act gives the State and its officers and employees broad immunity from "any ... judgment, damages, penalties, costs or other money entitlement" for a discretionary official act performed in good faith and without gross or wanton negligence. Under § 4011(a), counties and municipalities are separately immune from tort-damages suits except for a short, specifically enumerated list (use of motor vehicles, operation of public buildings, and sudden accidental pollution releases), and even where immunity is lifted, recovery against a political subdivision is capped at $300,000 per occurrence absent extra insurance coverage. Separately, the State's sovereign immunity is waived only "as to any risk or loss covered by the state insurance coverage program." None of these statutes, and no case this survey located, specifically addresses whether ordinary § 2301 prejudgment interest, or § 2301(d)'s settlement-demand mechanism, applies once a claim against a Delaware governmental entity clears this immunity threshold in the first place.
Other exceptions
The common-law line is pecuniary calculability, not whether the exact award was known before trial. Rollins excludes bodily harm, emotional distress, and reputation damages from that route. Those claims must satisfy § 2301(d) when it applies. Punitive damages do not draw prejudgment interest. The claimant must also request interest in the pleadings or raise it at trial.
What trips people up
The biggest trap is assuming a personal-injury claim automatically draws prejudgment interest the way a contract claim does. It doesn't, the common-law "ascertainable damages" rule that gives contract claims their matter-of-right interest specifically excludes the kind of damages (pain and suffering, emotional distress) that make up most personal-injury verdicts, so a tort plaintiff who never sent a qualifying pretrial settlement demand under § 2301(d) can end up with no prejudgment interest at all, even after winning a large verdict.
The second trap cuts the other way: a plaintiff who sends a settlement demand that turns out to be higher than the eventual jury award loses the § 2301(d) tort interest entirely, there's no partial credit for having tried to settle. Getting the demand amount right, relative to what a case is actually likely to be worth at trial, matters as much as making the demand at all.
Common questions
What's Delaware's prejudgment interest rate? A floating rate: 5 percentage points over the Federal Reserve discount rate (including any surcharge), locked in as of the date interest became due, not the date of judgment.
Do I get prejudgment interest automatically if I win a personal injury case in Delaware? Not automatically. You need to have extended the defendant a written settlement demand before trial, valid for at least 30 days, for an amount less than what the judgment eventually awards you.
Does Delaware prejudgment interest compound? In Superior Court and the Court of Common Pleas, no, simple interest is the norm. The Court of Chancery has its own discretion to award compound interest but usually doesn't when the claim could have been brought in Superior Court instead.
Can I get prejudgment interest if I sue the State of Delaware? It depends first on whether your claim survives Delaware's broad Tort Claims Act immunity at all, that's a merits question the immunity statutes answer before interest ever comes up, and this survey found no case specifically addressing how § 2301's interest rules apply once a claim against the government clears that threshold.
Statutes and sources
- 6 Del. C. § 2301(a), (d), default rate and the tort settlement-demand mechanism. Accessed 2026-08-11: https://delcode.delaware.gov/title6/c023/index.html
- 10 Del. C. §§ 4001 and 4011(a), state and local-government immunity. Accessed 2026-08-11: https://delcode.delaware.gov/title10/c040/sc01/index.html and https://delcode.delaware.gov/title10/c040/sc02/index.html
- 18 Del. C. § 6511, insurance-coverage waiver. Accessed 2026-08-11: https://delcode.delaware.gov/title18/c065/sc01/index.html
- Moskowitz v. Mayor & Council of Wilmington, 391 A.2d 209 (Del. 1978), matter-of-right rule, due-date baseline, and delay reduction. https://www.courtlistener.com/opinion/1956408/ (accessed 2026-08-11).
- Brandywine Smyrna, Inc. v. Millennium Builders, LLC, 34 A.3d 482 (Del. 2011), § 2301(d)'s tort-only gate, blended claims, and calculable pecuniary damages. https://www.courtlistener.com/opinion/5144828/ (accessed 2026-08-11).
- Rollins Environmental Services, Inc. v. WSMW Industries, Inc., 426 A.2d 1363 (Del. Super. Ct. 1980), pecuniary-calculability boundary. https://www.courtlistener.com/opinion/2074884/ (accessed 2026-08-11).
Source links
Every statute quoted above, linked, with the date we checked it.
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