CHAPTER 304. JUDGMENT INTEREST
FINANCE CODE
TITLE 4. REGULATION OF INTEREST, LOANS, AND FINANCED TRANSACTIONS
SUBTITLE A. INTEREST
CHAPTER 304. JUDGMENT INTEREST
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 304.001. INTEREST RATE REQUIRED IN JUDGMENT. A money
judgment of a court in this state must specify the postjudgment
interest rate applicable to that judgment.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.002. JUDGMENT INTEREST RATE: INTEREST RATE OR TIME
PRICE DIFFERENTIAL IN CONTRACT. A money judgment of a court of
this state on a contract that provides for interest or time price
differential earns postjudgment interest at a rate equal to the
lesser of:
(1) the rate specified in the contract, which may be a variable
rate; or
(2) 18 percent a year.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.003. JUDGMENT INTEREST RATE: INTEREST RATE OR TIME
PRICE DIFFERENTIAL NOT IN CONTRACT. (a) A money judgment of a
court of this state to which Section 304.002 does not apply,
including court costs awarded in the judgment and prejudgment
interest, if any, earns postjudgment interest at the rate
determined under this section.
(b) On the 15th day of each month, the consumer credit
commissioner shall determine the postjudgment interest rate to be
applied to a money judgment rendered during the succeeding
calendar month.
(c) The postjudgment interest rate is:
(1) the prime rate as published by the Board of Governors of the
Federal Reserve System on the date of computation;
(2) five percent a year if the prime rate as published by the
Board of Governors of the Federal Reserve System described by
Subdivision (1) is less than five percent; or
(3) 15 percent a year if the prime rate as published by the
Board of Governors of the Federal Reserve System described by
Subdivision (1) is more than 15 percent.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999; Acts 2003, 78th Leg., ch. 204, Sec. 6.01, eff. Sept. 1,
2003; Acts 2003, 78th Leg., ch. 676, Sec. 1, eff. June 20, 2003.
Amended by:
Acts 2005, 79th Leg., Ch.
387, Sec. 1, eff. September 1, 2005.
Acts 2005, 79th Leg., Ch.
1018, Sec. 7.01, eff. September 1, 2005.
Sec. 304.004. PUBLICATION OF JUDGMENT INTEREST RATE. The
consumer credit commissioner shall send to the secretary of state
the postjudgment interest rate for publication, and the secretary
shall publish the rate in the Texas Register.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.005. ACCRUAL OF JUDGMENT INTEREST. (a) Except as
provided by Subsection (b), postjudgment interest on a money
judgment of a court in this state accrues during the period
beginning on the date the judgment is rendered and ending on the
date the judgment is satisfied.
(b) If a case is appealed and a motion for extension of time to
file a brief is granted for a party who was a claimant at trial,
interest does not accrue for the period of extension.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.006. COMPOUNDING OF JUDGMENT INTEREST. Postjudgment
interest on a judgment of a court in this state compounds
annually.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.007. JUDICIAL NOTICE OF JUDGMENT INTEREST RATE. A
court of this state shall take judicial notice of a published
postjudgment interest rate.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
SUBCHAPTER B. PREJUDGMENT INTEREST IN WRONGFUL DEATH, PERSONAL
INJURY, OR PROPERTY DAMAGE CASE
Sec. 304.101. APPLICABILITY OF SUBCHAPTER. This subchapter
applies only to a wrongful death, personal injury, or property
damage case of a court of this state.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.102. PREJUDGMENT INTEREST REQUIRED IN CERTAIN CASES. A
judgment in a wrongful death, personal injury, or property damage
case earns prejudgment interest.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.103. PREJUDGMENT INTEREST RATE FOR WRONGFUL DEATH,
PERSONAL INJURY, OR PROPERTY DAMAGE CASE. The prejudgment
interest rate is equal to the postjudgment interest rate
applicable at the time of judgment.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.104. ACCRUAL OF PREJUDGMENT INTEREST. Except as
provided by Section 304.105 or 304.108, prejudgment interest
accrues on the amount of a judgment during the period beginning
on the earlier of the 180th day after the date the defendant
receives written notice of a claim or the date the suit is filed
and ending on the day preceding the date judgment is rendered.
Prejudgment interest is computed as simple interest and does not
compound.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.1045. FUTURE DAMAGES. Prejudgment interest may not be
assessed or recovered on an award of future damages.
Added by Acts 2003, 78th Leg., ch. 204, Sec. 6.02, eff. Sept. 1,
2003.
Sec. 304.105. EFFECT OF SETTLEMENT OFFER ON ACCRUAL OF
PREJUDGMENT INTEREST. (a) If judgment for a claimant is equal
to or less than the amount of a settlement offer of the
defendant, prejudgment interest does not accrue on the amount of
the judgment during the period that the offer may be accepted.
(b) If judgment for a claimant is more than the amount of a
settlement offer of the defendant, prejudgment interest does not
accrue on the amount of the settlement offer during the period
that the offer may be accepted.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.106. SETTLEMENT OFFER REQUIREMENTS TO PREVENT
PREJUDGMENT INTEREST ACCRUAL. To prevent the accrual of
prejudgment interest under this subchapter, a settlement offer
must be in writing and delivered to the claimant or the
claimant's attorney or representative.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.107. VALUE OF SETTLEMENT OFFER FOR COMPUTING
PREJUDGMENT INTEREST. If a settlement offer does not provide for
cash payment at the time of settlement, the amount of the
settlement offer for the purpose of computing prejudgment
interest is the cost or fair market value of the settlement offer
at the time it is made.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
SUBCHAPTER C. OTHER PREJUDGMENT INTEREST PROVISIONS
Sec. 304.201. PREJUDGMENT INTEREST RATE FOR CONDEMNATION CASE.
The prejudgment interest rate in a condemnation case is equal to
the postjudgment interest rate at the time of judgment and is
computed as simple interest.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
SUBCHAPTER D. EXCEPTIONS TO APPLICATION OF CHAPTER
Sec. 304.301. EXCEPTION FOR DELINQUENT TAXES. This chapter does
not apply to a judgment:
(1) in favor of a taxing unit in a delinquent tax suit under
Subchapter C, Chapter 33, Tax Code; or
(2) that earns interest at a rate set by Title 2, Tax Code.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.
Sec. 304.302. EXCEPTION FOR DELINQUENT CHILD SUPPORT. This
chapter does not apply to interest that accrues on an amount of
unpaid child support under Section 157.265, Family Code.
Amended by Acts 1999, 76th Leg., ch. 62, Sec. 7.18(a), eff. Sept.
1, 1999.