Prejudgment Interest Rules in Utah
At a glance
| Governing law | Utah Code § 15-1-1 governs contract rates; § 78B-5-824 governs injury and death claims; Utah case law governs other fixed, measurable losses |
|---|---|
| Interest rate | Contracts: agreed rate or 10% under § 15-1-1. Injury/death: January prime plus 2 points, minimum 5%, maximum 10% (§ 78B-5-824). Other eligible losses: § 15-1-4 rate under Fuller |
| When interest starts running | Injury-year special damages: first date incurred; later-year damages: January 1 of each year incurred (§ 78B-5-824(5)). Other fixed losses: date measurable (Bjork); contract timing depends on when the loss became fixed |
| Contract vs. tort claims | Contracts use § 15-1-1; injury/death claims use § 78B-5-824 only for incurred special damages; other measurable tort losses follow the common-law rule and § 15-1-4 rate |
| Mandatory or discretionary | Fixed, measurable damages qualify under Bjork; § 78B-5-824 says a qualifying plaintiff may claim interest and directs the court to calculate it at the statutory rate |
| Simple or compound | Simple interest expressly required for injury/death claims (§ 78B-5-824(5)(a)); §§ 15-1-1 and 15-1-4 give no express compounding instruction |
| Claims against the government | Qualifying government judgments face adjusted liability limits. For incidents from July 1, 2026: $963,800 per person, $3,879,500 aggregate, $387,700 property damage (Utah Code § 63G-7-604; R37-4-3) |
| Other exceptions | § 78B-5-824 excludes future medical and wage losses. Tier 1 requires a written demand no more than 1⅓ of the eventual judgment, with the controlling offer at least 60 days before trial; tier 2/3 and named arbitration are exempt |
Requirements one by one
Interest rate
Under Utah Code § 15-1-1(2), the legal contract rate is 10% annually unless the parties agree on another rate. Utah Code § 78B-5-824(5) uses a different rate for injury and death claims: two percentage points above the prime rate on the first business day of January in the judgment year, bounded by 5% and 10%. In Fuller v. Bohne, a measurable tort loss used § 15-1-4(3)(a)'s federal postjudgment rate plus two percentage points because the contract statute did not apply.
When interest starts running
For special damages first incurred in the year of the injury, § 78B-5-824(5)(a) starts simple interest on the first date such damages were actually incurred. For damages incurred in later years, subsection (5)(b) starts interest on January 1 of each year in which they were incurred. The rate is keyed to the January prime rate in the year judgment is entered; the statute does not call for a new prime rate for every accrual year. Under Bjork v. April Industries, other interest-eligible losses run from the date the amount became fixed and measurable by facts and figures.
Claims against the government
Utah Code § 63G-7-604(1)(a), (c), (d) limits qualifying government judgments and directs adjustment of the printed base figures. The 2026 amendment to § 63G-7-605(4) makes a new limit apply prospectively to injuries or losses after the rule's effective date. Utah Admin. Code R37-4-3 sets the limits for incidents on or after July 1, 2026, at $963,800 per injured person, $3,879,500 in aggregate for two or more persons, and $387,700 for property damage. Earlier incidents require the limit in force on their date.
Other exceptions
Utah Code § 78B-5-824(6) excludes future medical expenses, future wages, and future earning capacity from interest-bearing special damages. In a tier 1 case, subsections (2)–(3) require a written settlement demand no more than one and one-third times the eventual judgment; the controlling written offer or counteroffer must have been tendered at least 60 days before trial. Subsection (4) exempts tier 2 and tier 3 cases and the named binding-arbitration claims from that demand requirement.
What trips people up
An older case describing § 15-1-1 as limited to loans and forbearances construed its earlier wording. The current statute expressly includes a claim for breach of contract. Fuller still explains why a tort judgment does not receive the contract rate.
The prior government cap figures printed in § 63G-7-604 are base amounts, not the adjusted limits for a 2026 incident. The official risk-management rule gives the later figures and ties them to the incident date.
Common questions
Does every Utah personal-injury award earn prejudgment interest? Section 78B-5-824 reaches special damages actually incurred. Tier 1 claimants must also satisfy its settlement-demand conditions.
Is the injury rate compounded or reset each January? No. Section 78B-5-824(5) requires simple interest and uses the January prime rate in the year judgment is entered. Its January 1 rule concerns when later-year damages begin accruing.
Can a property-damage tort claim receive interest? It may when the loss was fixed and measurable at a particular time under Bjork. Fuller applied § 15-1-4's rate to a qualifying tort judgment.
Statutes and sources
- Utah Code §§ 15-1-1 and 15-1-4, accessed 2026-10-06: https://le.utah.gov/xcode/Title15/Chapter1/C15-1_1800010118000101.pdf
- Utah Code § 78B-5-824, accessed 2026-10-06: https://le.utah.gov/xcode/Title78B/Chapter5/C78B-5-S824_2014040320140513.pdf
- Utah Code § 63G-7-604, accessed 2026-10-06: https://le.utah.gov/xcode/Title63G/Chapter7/C63G-7_1800010118000101.pdf
- Utah Code § 63G-7-605(4), 2026 H.B. 507, accessed 2026-10-06: https://le.utah.gov/Session/2026/bills/enrolled/HB0507.pdf
- Utah Admin. Code R37-4-3, accessed 2026-10-06: https://risk.utah.gov/tools-resources/rules/
- Fuller v. Bohne, 2017 UT App 28, accessed 2026-10-06: https://law.justia.com/cases/utah/court-of-appeals-published/2017/20150146-ca.html
- Kraatz v. Heritage Imports, 2003 UT App 201, quoting Bjork v. April Industries, accessed 2026-10-06: https://law.justia.com/cases/utah/court-of-appeals-published/2003/kraatz061203.html
Source links
Every statute quoted above, linked, with the date we checked it.
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