HBA-NIK H.B. 2058 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 2058
By: Uher
Civil Practices
3/22/1999
Introduced



BACKGROUND AND PURPOSE 

In 1985, the Texas Supreme Court adopted a rule allowing recovery of
prejudgement interest on personal injury, wrongful death, or survival
actions.  In 1987, the 70th Texas Legislature amended the Finance Code to
broaden the statute on judgment interest, establishing a floor and ceiling
for interest rates, shortening the period of interest accrual, and changing
the rate from compounded daily interest to simple interest.  In 1994, the
Supreme Court ruled that the law provided for prejudgment interest on
future damages. 

H.B 2058 eliminates minimum and maximum rates for prejudgment interest, and
prohibits a court from awarding prejudgment interest on future damages. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 304.003(c), Finance Code, by deleting
Subdivisions (2) and (3), relating to minimum and maximum rates on judgment
interest. 

SECTION 2.  Amends Subchapter B, Chapter 304, Finance Code, by adding
Section 304.109 as follows: 

Sec. 304.109.  PREJUDGEMENT INTEREST ON FUTURE DAMAGES PROHIBITED.
Prohibits a court from awarding prejudgment interest on future damages. 

SECTION 3.  Makes application of this Act prospective.

SECTION 4.  Provides that, to the extent of any conflict, this Act prevails
over another Act of the 76th Legislature, Regular Session, 1999, relating
to nonsubstantive additions and corrections in enacted codes. 

SECTION 5.  Emergency clause.
  Effective date: upon passage.