45-103 Interest; judgments; decrees; rate; exceptions. - Nebraska Statutes

45-103. Interest; judgments; decrees; rate; exceptions.For decrees and judgments rendered before July 20, 2002, interest on decrees and judgments for the payment of money shall be fixed at a rate equal to one percentage point above the bond equivalent yield, as published by the Secretary of the Treasury of the United States, of the average accepted auction price for the last auction of fifty-two-week United States Treasury bills in effect on the date of entry of the judgment. For decrees and judgments rendered on and after July 20, 2002, interest on decrees and judgments for the payment of money shall be fixed at a rate equal to two percentage points above the bond investment yield, as published by the Secretary of the Treasury of the United States, of the average accepted auction price for the first auction of each annual quarter of the twenty-six-week United States Treasury bills in effect on the date of entry of the judgment. The State Court Administrator shall distribute notice of such rate and any changes to it to all Nebraska judges to be in effect two weeks after the date the auction price is published by the Secretary of the Treasury of the United States. This interest rate shall not apply to:(1) An action in which the interest rate is specifically provided by law; or(2) An action founded upon an oral or written contract in which the parties have agreed to a rate of interest other than that specified in this section. SourceLaws 1879, § 3, p. 113; R.S.1913, § 3348; C.S.1922, § 2836; C.S.1929, § 45-103; Laws 1933, c. 85, § 1, p. 336; C.S.Supp.,1941, § 45-103; R.S.1943, § 45-103; Laws 1972, LB 1330, § 1; Laws 1980, LB 279, § 6; Laws 1981, LB 42, § 24; Laws 1981, LB 167, § 32; Laws 1986, LB 298, § 1; Laws 1994, LB 1183, § 1; Laws 2000, LB 921, § 35; Laws 2002, LB 876, § 78. Cross ReferencesFor provisions for interest on judgments against the state, see section 25-21,211. Annotations1. Contract rate2. Judgments and decrees generally3. Installment judgment4. Verdict5. Miscellaneous1. Contract rateThis section allows parties to contractually agree to a rate of prejudgment interest that will apply to an unliquidated claim. Folgers Architects v. Kerns, 262 Neb. 530, 633 N.W.2d 114 (2001).Under security agreements providing for interest at highest legal rate, secured party was entitled to nine percent a year on amounts due from date of default and nine percent on part of judgment covering amounts due for repossession, repair, and cleaning of trucks from date judgment was entered. Cornett v. White Motor Corp., 190 Neb. 496, 209 N.W.2d 341 (1973).Lawful interest, where rate is not fixed by statute, is subject of contract as limited by law, and is not allowable at a different rate by court of equity. Johnson v. Kindig, 127 Neb. 360, 255 N.W. 236 (1934).Judgment on note held to draw same rate of interest as note from its date, if the rate is equal to or exceeds the legal rate and does not exceed the maximum lawful rate. Calloway v. Doty, 108 Neb. 319, 188 N.W. 104 (1922).Judgments should draw interest at seven percent from date of rendition when founded upon contract providing for less rate. Portsmouth Savings Bank v. Yeiser, 81 Neb. 343, 116 N.W. 38 (1908).Where contract provides for payment at legal rate until maturity and hiqher rate thereafter, judgment will draw higher rate. Conn. Mut. Life Ins. Co. v. Westerhoff, 58 Neb. 379, 78 N.W. 724, 79 N.W. 731 (1899).Contract to pay ten percent instead of seven, as provided in contract, to gain extension of time, is valid, and interest is not payable till principal is due. Greenwood v. Fenton, 54 Neb. 573, 74 N.W. 843 (1898).Where contract bears interest at six percent before maturity and ten thereafter, decree will draw ten. Havemeyer v. Paul, 45 Neb. 373, 63 N.W. 932 (1895).2. Judgments and decrees generallyIt is not mandatory that interest be charged on a marital deferred property distribution. It is, however, within the discretionary power of a district court to award interest on deferred installments payable as part of a marital property distribution. When utilizing this discretionary power, a factor the district court or the Court of Appeals should take into consideration is the burden of the payor spouse. Priest v. Priest, 251 Neb. 76, 554 N.W.2d 792 (1996).When a judgment is to be paid in installments, interest begins to accrue on each individual installment only from the date it becomes due and payable. Thiltges v. Thiltges, 247 Neb. 371, 527 N.W.2d 853 (1995).Plaintiff was entitled to six percent interest on claim allowed against receiver until amendment increased it to eight percent from July 6, 1972. Colburn v. Ley, 191 Neb. 427, 215 N.W.2d 869 (1974).Provision for interest on decrees and judgments relates to money immediately due and collectible where its nonpayment is a breach of duty. Patterson v. Spelts Lumber Co., 166 Neb. 692, 90 N.W.2d 283 (1958).Order of court establishing trust fund in sum certain, entitled to priority of payment from assets of failed bank before claims of depositors and creditors are paid, bears interest at legal rate from date of decree until paid, and accrued interest is preferred claim over claims of depositors and creditors. State ex rel. Spillman v. First State Bank, 124 Neb. 786, 248 N.W. 383 (1933).Where court in receivership proceeding allows depositor of insolvent bank preferred claim payable from guaranty fund, the order is a judgment and such judgment draws interest at legal rate until paid. Bliss v. Bryan, 123 Neb. 461, 243 N.W. 625 (1932).In liquidation of insolvent bank, allowance of trust fund is decree in the nature of judgment for payment of money, and hereunder, bears interest at legal rate from date of judgment until paid. Hall v. Citizens State Bank, 122 Neb. 636, 241 N.W. 123 (1932).Insolvent state bank is liable for interest at seven percent on deposit after allowance of claim. State ex rel. Spillman v. Nebraska State Bank of Harvard, 118 Neb. 660, 225 N.W. 778 (1929).Judgments, when revived, draw interest at legal rate from date of rendition. McDonald v. Thomas Co., 89 Neb. 494, 131 N.W. 1021 (1911).Decree in favor of heirs, against trustee of estate, draws interest at seven percent. Smullin v. Wharton, 86 Neb. 553, 125 N.W. 1112 (1910).Interest on judgment should be computed from date of rendition. Tobler v. Union Stock Yards Co., 85 Neb. 413, 123 N.W. 461 (1909).Decree in suit on creditor's bill, ordering defendant to pay money into court forthwith, draws interest, though not provided in decree. Stuart v. Burcham, 62 Neb. 84, 86 N.W. 898 (1901).Decree foreclosing mortgage draws interest from date of rendition until paid. Stenger v. Carrig, 61 Neb. 753, 86 N.W. 475 (1901).Judgments draw interest until paid. Trompen v. Hammond, 61 Neb. 446, 85 N.W. 436 (1901).Deposit of money into court on decree of distribution; when to draw interest. Whitall v. Cressman, 18 Neb. 508, 26 N.W. 245 (1886).3. Installment judgmentWhere a judgment is required to be paid in installments, interest begins to accrue on each individual installment from the date it becomes due and payable. Dryden v. Dryden, 205 Neb. 666, 289 N.W.2d 525 (1980).Delinquent installments of child support bear interest at the legal rate from the date of delinquency. Ferry v. Ferry, 201 Neb. 595, 271 N.W.2d 450 (1978).The trial court has the inherent power in adjusting the rights of the parties to provide that a money allowance to be paid in installments shall not draw interest until a certain date. Nickel v. Nickel, 201 Neb. 267, 267 N.W.2d 190 (1978).Where judgment was rendered for specific amount against each of several defendants jointly and severally liable, and case continued for further decree in event any should fail to pay, interest on remaining amount begins from date of demand and refusal, not from original judgment. First Nat. Bank of Omaha v. Cooper, 91 Neb. 624, 136 N.W. 1023 (1912).Section refers to judgments collectible at once. Installment judgments should draw interest from date of maturity of installment until paid. Dike v. Andrews, 80 Neb. 455, 114 N.W. 582 (1908).4. VerdictInterest is allowable on amount of verdict from date of rendition to entry of judgment thereon. Hilton v. State, 60 Neb. 421, 83 N.W. 354 (1900).Interest on verdict in tort should be allowed up to rendition of judgment and become part thereof. Fremont, E. & M. V. R.R. Co. v. Root, 49 Neb. 900, 69 N.W. 397 (1896).5. MiscellaneousBased on the mandatory language contained herein, a court of equity does not have discretion to withhold interest on decrees or judgments for the payment of money. Welch v. Welch, 246 Neb. 435, 519 N.W.2d 262 (1994).A court of equity has a reasonable discretion to allow or withhold interest as is reasonable and just, except in cases where it is recoverable as a matter of right. Kullbom v. Kullbom, 215 Neb. 148, 337 N.W.2d 731 (1983).The provisions for interest in this section apply to sales conducted pursuant to statutory procedures relating to foreclosure sales. They do not apply as a matter of right to sales conducted under terms negotiated by the parties. In such situations, the court may exercise reasonable discretion in allocating interest between the parties. Bankers Union Life Ins. Co. v. Nebraska Corp., 211 Neb. 350, 318 N.W.2d 730 (1982).Where usury is established, plaintiff is not entitled to interest on the judgment. Central Constr. Co. v. Blanchard, 180 Neb. 62, 141 N.W.2d 416 (1966).Interest is not allowed on attorney's fee until claim is reduced to judgment. Metcalf v. Hartford Acc. & Ind. Co., 176 Neb. 468, 126 N.W.2d 471 (1964).Representatives of estates should be surcharged with interest at legal rate when they have abused their trust. In re Estate of Wiley, 150 Neb. 898, 36 N.W.2d 483 (1949).In action to rescind a contract, where certain money in hands of defendant is found to be an equitable trust fund in favor of plaintiff, plaintiff is entitled to interest thereon. Ericson v. Nebraska-Iowa Farm Investment Co., 134 Neb. 391, 278 N.W. 841 (1938).Where payment is made upon judgment in excess of interest then due thereon, entire balance due on judgment bears interest as provided by law from date of such payment. Rawlings v. Anheuser-Busch Brewing Co., 69 Neb. 34, 94 N.W. 1001 (1903).In all actions interest is recoverable for use or destruction of property when amount due plaintiff may be ascertained by reference to market values. Missouri, K. & T. Trust Co. v. Clark, 60 Neb. 406, 83 N.W. 202 (1900).Note, providing for legal rate until maturity and higher legal rate thereafter, is not a penalty and not usurious. Crapo v. Hefner, 53 Neb. 251, 73 N.W. 702 (1898).Where interest on note plus commission on loan taken together do not exceed legal rate for period, it is not usurious. Upton v. O'Donahue, 32 Neb. 565, 49 N.W. 267 (1891).In Frazier-Lemke proceedings, failure to file claim at time of application for extension does not prejudice holder of mortgage lien, and holder of lien is not required to offer proof of freedom from usury. Rafert v. Federal Farm Mortgage Corporation, 152 F.2d 193 (8th Cir. 1945).In awarding damages for breach of contract, court could not allow interest on unliquidated claim at a rate exceeding six percent after statute reducing legal rate from seven to six percent became effective. Otoe County Nat. Bank v. Delany, 88 F.2d 238 (8th Cir. 1937).Alleged error in calculating interest on allowance of attorney's fees is not reviewable in absence of motion, objection or exception, or assignment of error at trial. Metropolitan Life Ins. Co. v. Armstrong, 85 F.2d 187 (8th Cir. 1936).