winter 2003 vol.9 no. 3                                                                                                                        Return to Contents
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HB4: The Nuts and Bolts of Tort Reform

Professor Melissa Essary

n 2003, the Texas legislature passed the most sweeping tort reform ever enacted by any state. The push for tort reform was a Republican-backed initiative, and heated debate surrounded the passage of the bill, most of which benefits defendants. The end result is House Bill 4, which makes monumental changes to Texas tort law, changes that will reverberate in litigation for many years to come. The bill impacts not only personal injury litigation, but all civil litigation. Importantly, House Bill 4 is very complicated, and courts will be left to interpret countless portions of the bill.
The most significant changes involve settlement offers, damages, proportionate responsibility, product liability, medical negligence, auto accidents, pre and post judgment interest and wrongful death. This paper will address the major changes in these areas.1

Settlement Offer Rules

All litigators in Texas, including commercial litigators, must become familiar with the new settlement offer rules in Chapter 42 of the Civil Practice and Remedies Code. Chapter 42 shifts “litigation costs” to the prevailing party under specified circumstances. This provision significantly raises the financial stakes for a party who rejects a settlement offer. By injecting financial risk into the settlement process, the intent of the chapter is to encourage settlement. Without question, it complicates the settlement process. The offer of settlement rules apply to cases filed after January 1, 2004. The Texas Supreme Court must promulgate rules implementing this chapter by December 31, 2003. Ultimately, the settlement offer rules will be codified in Rule 167 of the Texas Rules of Civil Procedure. The Court’s proposed rules can be viewed at the Texas Supreme Court’s website at

1. Application of the Settlement Offer Rule
The settlement procedures apply only to claims for monetary damages. The procedures exclude claims involving class actions, shareholder derivative actions, an action by or against a governmental unit, an action under the family code, an action to collect worker’s compensation benefits or an action in J.P. court. The offer of settlement provisions can be initiated only by a defendant who files a declaration under this chapter. Once a defendant files a declaration, then this chapter becomes available to the plaintiff against the defendant making the declaration.

2. Making the Settlement Offer
The settlement offer must

a. be in writing;
b. state that it is made under Rule 167 and this chapter;
c. state the terms by which the claims may be settled;
d. state a deadline by which the settlement offer must be accepted; and
e. be served on all parties to whom the settlement offer is made.

3. Awarding Litigation Costs
The heart of the settlement offer rule is the fee-shifting mechanism. Chapter 42 provides that, if a settlement offer is made under this chapter and is rejected, the rejecting party may be responsible for litigation costs incurred after the date of rejection. Litigation costs will be recovered if the plaintiff rejects a settlement offer and recovers less than 80% of the rejected offer, or, if the defendant rejects a settlement offer and the award is more than 120% of the rejected offer.
The definition of “litigation costs” is expansive. It includes not only court costs, but reasonable attorney’s fees incurred after the date of rejection, and reasonable fees for not more than two testifying expert witnesses. Obviously, the earlier the rejected settlement offer is made, the higher the costs that potentially will be shifted. If the defendant is entitled to litigation costs from the plaintiff, the amount cannot exceed

a. 50% of the economic damages;
b. 100% of the non-economic damages; and
c. 100% of the exemplary damages.

Litigation costs to a defendant are awarded as an offset to the plaintiff’s judgment. Presumably, litigation costs to the plaintiff are added to the judgment.

As a practical matter, plaintiffs’ attorneys will need to maintain time records on any case after this chapter has been invoked, and a defendant then refuses a plaintiff’s settlement offer. In such a situation, the plaintiff may be able to recover his/her reasonable attorneys fees if the award is more than 120% of the offer rejected by the defendant. Thus, in such a situation, the plaintiff’s attorney must be able to prove up reasonably necessary attorney’s fees.
Because plaintiffs can also take advantage of the fee-shifting mechanism, a defendant should seriously investigate and evaluate a case before putting fee shifting in play by invoking the settlement offer rules. Once invoked, as noted above, the plaintiff may counteroffer, and the defendant may end up being tagged with fee shifting, depending upon the ultimate judgment entered in the case.

Chapter 41: Damages

Chapter 41 of the Civil Practices and Remedies Code has been renamed, from “Exemplary Damages” to “Damages.” The new name aptly reflects the expanded scope of the chapter, which also makes several important changes to damages law in Texas.

1. Unanimous Jury Findings on Punitive Damages
In all actions filed after September 1, 2003, punitive damages may be awarded only if the liability finding of fraud, malice or gross negligence is unanimous. Further, the jury must unanimously agree on the amount of punitive damages to be awarded. Juries will be instructed that both of these answers require a unanimous finding.

2. Limitation on “Cap-Busting” Provision
Chapter 41 contains certain penal code violations that allow plaintiffs to “bust” the ceiling on punitive damages. By proving the elements of these crimes, plaintiffs avoid the punitive damages cap. The legislature has cut off an important avenue of cap-busting
in nursing home litigation. Section 41.008 originally allowed cap-busting by proving a reckless injury to a child, elderly individual, or disabled individual. This provision was used primarily in nursing home litigation to avoid the punitive damages cap.
Under the amended version, plaintiffs cannot utilize this provision to avoid the caps if the conduct resulting in injury occurred while providing health care. As a nursing home is a “health care provider” under the Medical Liability Act in Chapter 42, the punitive damage cap cannot be “busted” in nursing home litigation under this penal code section. Ironically, while the conduct at issue may constitute a crime against the nursing home patient, the legislature has given special protection to nursing homes who recklessly injure those patients. This cap on punitive damages in nursing home litigation dramatically impacts the economic viability of filing such a lawsuit. The viability of bringing such a claim also is impacted by the new cap on non-economic damages in health care liability claims, discussed later in this article.

3. Potential Limitation on Recoverable Medical Expenses
New § 41.0105 is a curious provision that may allow the defendant to reduce medical expenses it would otherwise owe the plaintiff by the amount the plaintiff receives pursuant to her own medical insurance coverage. The new provision is far from clear in its effect, however. It states that “In addition to any other limitation under law, recovery of medical or health care expenses incurred is limited to the amount actually paid or incurred by or on behalf of the claimant.”
This language seems to erode the “collateral source” rule, which holds that a wrongdoer is not entitled to have the damages for which he is liable reduced by proving the plaintiff received compensation from a collateral source. The wording of the statute may make admissible the plaintiff’s recovery of medical expenses under her own health care policy so as to reduce what the wrongdoer owes. Undoubtedly, the courts will be called upon to interpret and apply this provision. Interpreting this provision becomes particularly complicated when one considers that medical insurance providers often include a contractual provision requiring reimbursement from the plaintiff in the event of settlement or a judgment.

4. New Definitions of Various Types of Damages
Also, Chapter 41 now contains definitions of “compensatory damages,” “future damages,” “future loss of earnings,” “gross negligence,” “non-economic damages,” and “periodic payments.” These definitions may pave the way for other caps in future legislative sessions.

5. Return of Gross Negligence as Predicate for Punitive Damages
The legislature amended §41.003 and returned “gross negligence” as a proper standard for imposing punitive damages. In 1995, the legislature utilized “malice” as a standard for imposing punitive damages, but strangely, the definition of “malice” was that of gross negligence. The legislature has corrected its mistake, and now “gross negligence” means just that, gross negligence. Malice is also remains a standard for imposing punitive damages, but it is now properly defined according to its common meaning as a “specific intent by the defendant to cause substantial injury or harm to the claimant.”

6. Jury Instruction on Plaintiff’s Tax Liability
Another new damages provision is worthy of mention. Section §18.091 of the TPRC provides that

(a) Notwithstanding any other law, if any claimant seeks recovery for loss of earnings, loss of earning capacity, loss of contributions of a pecuniary value, or loss of inheritance, evidence to prove the loss must be presented in the form of a net loss after reduction for income tax payments or unpaid tax liability pursuant to any federal income tax law.

(b) If any claimant seeks recovery for loss of earnings, loss of earning capacity, loss of contributions of a pecuniary value, or loss of inheritance, the court shall instruct the jury as to whether any recovery for compensatory damages sought by the claimant is subject to federal or state income taxes.

Since any personal injury recovery considered by the IRS as “income” is already taxable, i.e, lost wages, these sections pose the possibility of “double taxation” on the plaintiff’s lost income. In construing this statute, courts should seek to avoid this possible punitive effect on a plaintiff’s recovery.

Chapter 33–Proportionate Responsibility

The legislature extensively amended Chapter 33, which governs cases in which more than one person is alleged to be liable for the claimant’s damages. The new amendments radically expand the definition of a “responsible third party,” a change that will benefit many defendants. Further, the legislature dramatically revised how a defendant can take advantage of another person’s settlement with the claimant.

1. Determination of Percentage of Responsibility
Section § 33.004. was amended to eliminate the need to join responsible third parties “RTPs”). Now RTPs are simply designated, not joined. The jury may allocate fault to any responsible person, including a bankrupt, criminal, person beyond the court’s jurisdiction, or an employer with workers’ compensation immunity. In other words, the defendant may designate as an RTP an entity whom the plaintiff never could have sued. This is a significant departure from previous law and provides new opportunities for defendants to dilute their percentages of responsibility. At the same time, a defendant may also be able to avoid being found more than 50% responsible, and as such, avoid being jointly and severally liable for the claimant’s recoverable damages.
A finding of fault against the RTP does not by itself impose liability on the person and may not be used in any other proceeding on any legal theory to impose liability on that person. For example, assume that an employee is injured on the job, and that the employer is a workers’ compensation subscriber. As a result, the employee cannot sue the employer for negligence. However, if the employee sues a third party, such as a products manufacturer, the products manufacturer can designate the employer as an RTP. If the jury finds the employer negligent, and assigns the employer a percentage of responsibility, the defendant’s negligence is reduced. However, the negligence finding and allocation of a percentage of responsibility against the employer do not impose nor create any liability on the employer.
Thus, an RTP has no liability to the claimant unless that claimant properly joins that RTP as a party. Again, as with the employer/employee example above, it may be impossible for the claimant to sue the RTP. As a result, an existing defendant may dilute his percentage of responsibility without making someone else liable.
If a defendant designates a responsible third party, and the plaintiff’s cause of action is barred by limitations against that party, the statute opens up a brief window of opportunity for the plaintiff to join the RTP as a defendant. The statute provides that if a person is designated under this section as an RTP, a claimant may join that person as a defendant, even though such joinder would otherwise be barred by limitations, if the claimant seeks to join that person not later than 60 days after the designation.

2. Designation of Responsible Third Party
A defendant may seek to designate a person as an RTP by filing a motion for leave to designate. The motion must be filed on or before the 60th day before the trial date unless the court finds good cause. Obviously, this time period is extremely close to the trial setting.
The statute also makes it very easy for a defendant to designate an RTP. The court must grant leave to designate the responsible third party unless another party files an objection within 15 days. Even if an objection is filed, the court must grant leave to designate unless the objecting party establishes:

a. the defendant did not plead sufficient facts; and
b. after having been granted leave to replead, the defendant still failed to plead sufficient facts.

If the responsible third party is alleged by the defendant to have committed a criminal act and are unknown persons, they will be designated as “Jane Doe” or “John Doe.” The unknown alleged criminal’s liability will be submitted to the jury. If the jury finds liability, the jury will determine the unknown criminal’s percentage of responsibility.

3. Settlement Credits
Section § 33.012 makes a major change to settlement credits and how other defendants may accordingly reduce the damages they owe the plaintiff. In all cases filed after July 1, 2003, the new section eliminates dollar-for-dollar credits, as well as the old, complicated sliding scale credit. Dollar-for-dollar credits are now available only in medical negligence cases. In a non-healthcare liability claim, the remaining tortfeasors receive a credit for whatever percentage of fault the jury assigns to the settling defendant. The percentage of fault is deducted regardless of the size of the settlement. Thus, in a non-health care liability claim, there is no strategy involved on the defendant’s part other than trying to increase the settling person’s percentage of responsibility and minimizing his/her own.
Plaintiffs, on the other hand, will have to pay considerable attention to the percentage of fault the jury may assign to the settling person. Under the new scheme, the plaintiff can obtain the advantage of a favorable settlement, but also may be disadvantaged by an unfavorable settlement. Here are two basic examples:

Example 1: Plaintiff settles with S for $60,000. Plaintiff’s total damages found at trial are $100,000. The jury finds D 70% responsible and S 30% responsible. Plaintiff’s total damages recovered are $60,000 (from the settlement) plus $70,000 (from D) = $130,000. The plaintiff obtained the advantage of a favorable settlement.

Example 2: Plaintiff settles with S for $30,000. Plaintiff’s total damages found at trial are $100,000. The jury finds D 30% responsible and S 70% responsible. Plaintiff’s total damages recovered are $60,000 ($30,000 from S and $30,000 from D). The plaintiff did not make a favorable settlement with S in light of the high percentage of responsibility allocated to S at trial.

The new settlement credit provisions appear to be equitable in most cases, and certainly are less complicated than the former rules. However, plaintiffs’ attorneys will need to carefully consider settlement strategy, and should be more concerned than ever about “empty chairs” and their effect upon joint and several liability.
In health care liability claims, defendants now have the option to choose either a dollar-for-dollar credit or a reduction based upon a percentage equal to each settling person’s percentage of responsibility. The sliding scale has been eliminated. A written election must be filed by a defendant prior to the case being submitted to the trier of fact and when made, is binding on all defendants. If no defendant makes an election or if conflicting elections are made, all defendants are considered to have elected dollar-for-dollar credits.

4. Changes to Joint and Several Liability Rules
Joint and several liability is a concept that makes a defendant liable for the claimant’s entire recoverable damages. If a defendant is found more than 50% at fault or is found to have violated certain penal code provisions, the defendant will be jointly and severally liable. Under prior law, a defendant found liable for environmental hazards or toxic torts was jointly and severally liable if found greater than 15% responsible. This latter provision has been eliminated in HB4.

Chapter 82—Products Liability

Changes to products liability law are extensive. First, a “products liability action” is now broadly defined to include any action against a manufacturer or seller relating to an alleged defective product. This includes not only strict product liability claims, but also breach of warranty and negligence actions. Thus, Chapter 82 applies to any claim alleging a product was defective.

1. Statute of Repose
Legislators enacted a 15 statute of repose for product liability claims, except in “latent disease” cases in which the disease does not manifest for many years after use of the product. After fifteen years from the date of sale by the defendant, no products liability action may be brought.

2. Innocent Retailer Defense
HB4 abolished the old rule that every entity that sold the product in the “stream of commerce” was potentially liable to the plaintiff, subject to indemnity rights against others. The legislature has eliminated the liability of non-manufacturing sellers through §82.003, subject to a few exceptions. This major change already has become known as the “innocent retailer defense.” The non-manufacturing seller cannot be held liable for a product defect unless some exception applies. Examples of exceptions include:

I.
making an incorrect factual representation about the product which the claimant relies on in using or obtaining the product, and had the representation been true, the plaintiff would not have been injured (the statute does not specify whether the representation may be oral or must be written); or

• the insolvency of the manufacturer;
• or the manufacturer is not subject to the jurisdiction of the court.

Importantly, if no exceptions apply, and only the manufacturer can be sued, this section may effectively allow the defendant manufacturer to remove the product liability case to federal court if diversity of citizenship exists. Most defendant manufacturers would much prefer to litigate a products liability claim in federal as opposed to state court.

3. Rebuttable Presumptions of No
Liability
Another section, §82.007, creates a rebuttable presumption of no liability for manufacturers, distributors, or prescribers of pharmaceutical products in which it is alleged that the defendant failed to provide an adequate warning about the product’s risk, if the defendant provided government approved warnings. This presumption can be rebutted if the plaintiff proves:

• the defendant, before or after pre-market approval or licensing of the product, withheld from or misrepresented to the United States Food and Drug Administration required information that was material and relevant to the performance of the product and was causally related to the injury;
• the product was sold or prescribed in the U.S. after an order from the FDA to remove the product from the market;
• the defendant recommended or prescribed the product for a use approved by the FDA (known as an “off-label” use), the product was used as recommended or prescribed and the injury was causally related to this use. An example of such an off-label use would be aspirin, approved as a pain-killer, as a heart attack preventative.
• the defendant prescribed the product for an indication not approved by the United States Food and Drug Administration;
• the defendant, before or after pre-market approval or licensing of the product violated 18 U.S.C. Section 201, and that conduct caused the warnings or instructions approved for the product by the United States Food and Drug Administration to be inadequate.

The inclusion of “prescribers” likely impacts informed consent cases based on the plaintiff’s assertion that her doctor failed to warn her of the side effects of medication.
The legislature created another rebuttable presumption to benefit defendants in § 82.008, which is entitled “Compliance With Government Standards.” This sections creates a rebuttable presumption that the product manufacturer or seller is not liable for any injury to a claimant caused by some aspect of the formulation, labeling, or design or a product if the product manufacturer or seller establishes that the product’s formula, labeling, or design complied with mandatory safety standards or regulations adopted and promulgated by the federal government, or an agency of the federal government, that were applicable to the product at the time of manufacture and that governed the product risk that allegedly caused harm.
The claimant may rebut the presumption in Subsection (a) by establishing that:

• the mandatory federal safety standards or regulations applicable to the product were inadequate to protect the public from unreasonable risks of injury or damage; or
• the manufacturer, before or after marketing the product, withheld or misrepresented information or material relevant to the federal government’s or agency’s determination of adequacy of the safety standards or regulations at issue in the action.

The creation of this rebuttable presumption should not have a great impact on products liability litigation, as even prior to this rule, plaintiffs typically introduced evidence that government safety standards were inadequate to protect the public from harm. Now such proof will operate to rebut the presumption of no liability. Importantly, this section does not extend to manufacturing flaws or defects. Further, it does not apply to medicines covered under §82.007.

4. Inadmissibility of Manufacturer’s Subsequent Remedial Measures
Under prior law, Rule 407 of the Texas Rules of Evidence expressly allowed the plaintiff to introduce evidence of subsequent remedial measures taken by the manufacturer in products liability cases based upon strict liability. This evidence could help persuade a jury that the product at issue was unreasonably dangerously defective. HB 4 changes that rule of evidence. HB4 required the Texas Supreme Court to make Texas Rule 407 consistent with Federal Rule 407 that prohibits the admission of such evidence, unless evidence of subsequent remedial measures is offered to establish ownership, control, or feasibility of precautionary measures, if controverted, or impeachment. Subpart (b) of Texas Rule 407 remains unaffected, however. It explicitly allows the admission of evidence of a manufacturer’s written notice of a defect sent to the product’s purchaser.

Chapter 74—The Medical
Liability Act

Old Article 4590i, which governed medical malpractice cases in Texas, is gone. Much of it has been transplanted into Chapter 74 of the Texas Civil Practice and Remedies Code, now entitled “Medical Liability.” This chapter applies to all actions filed after September 1, 2003. Anyone who prosecutes or defends a medical liability claim filed after September 1 must read Chapter 74 very carefully. Failure to comply with its provisions may result in dismissal of the claim with prejudice, and an award of reasonable attorney’s fees and costs incurred by the defendant. Importantly, the definition of a “health care liability claim” has been expanded, as has the definition of who is a “health care provider” under the act.

1. Procedural Changes
Important procedural portions of the Act have been amended. For example, § 74.051 now requires that the 60 day notice provision be accompanied by a specific authorization form for the release of protected health information. Section 74.052 provides the authorization form that must be provided with the 60 day notice letter. Failure to provide this form abates all further proceedings until 60 days following receipt of this form by the health care provider. Further, §74.351 makes substantial changes to procedural rules relating to expert reports.

2. Standard of Proof in Cases Involving Emergency Medical Care
Section 74.153 makes a dramatic change in the standard of proof required to prove medical negligence for emergency medical care in a hospital emergency department or obstetrical unit or in a surgical suite immediately following the evaluation and treatment of a patient in a hospital emergency department. Now, in addition to proving that the physician or health care provided departed from accepted standard of medical care, the plaintiff must prove willful and wanton negligence. Many cases likely will center on whether an “emergency” existed and, if so, when it ended such that the duty of reasonable care would apply.
The jury is also to be instructed to consider whether the person providing care did or did not have the patient’s medical history or was unable to obtain a full medical history, including the knowledge of pre-existing medical conditions, allergies, and medications; the presence or lack of a pre-existing physician/patient relationship or health care provider-patient relationship; the circumstances constituting the emergency; and the circumstances surrounding the delivery of the emergency medical care.

3. Statue of Repose in Health Care Liability Claims
Section 74.251 now adds a 10 year statute of repose so that all claims must be brought within 10 years or they are time barred. This, apparently, is intended to side step court cases which give minors until their 20th birthday to file suit.

4. Limitations on Non-Economic Damages
Section 74.301 is the code section that provides limitations on non-economic damages in health care liability claims. This section was the primary focus of Proposition 12, the controversial Constitutional amendment that recently passed. This section limits all non-economic damages to $250,000 regardless of the number of claimants and regardless of the number of physicians or other health care providers (other than a health care institution) who are found liable. Non-economic damages are limited to $250,000 against any single health care institution and no more than $500,000 if there are two or more health care institutions that are found liable.

5. Limitations on Wrongful Death/Survival Damages in Health Care Liability Claim
Section 74.303 maintains the death limit that was originally enacted in 1977 and limited wrongful death damages to $500,000, adjusted by the Consumer Price Index. This wrongful death/survival action limit is now approaching a total of $1,500,000; however, a significant change was added to this provision which makes the limit apply to each claim and not each physician or health care provider. Therefore, any wrongful death/survival action is now limited to approximately $1,500,000, regardless of the amount of economic damage and the number of defendants involved. Further, the cap includes punitive damages, but excludes health care expenses. In addition, the liability of any insurer under the “Stowers Doctrine,” can not exceed the liability of the insured. Prior to the enactment of this chapter, the death limit did not apply to a Stowers claim.

6. Court Order For Periodic Payments
The Medical Liability Act dramatically changes prior practice by allowing for periodic payments of future damages. Such payments apply to all cases in which the present value of the award of future damages equals or exceeds $100,000. At the request of a defendant physician or
health care provider or claimant, the court shall order that medical, health care, or custodial services be paid in whole or in part in periodic payments rather than by a lump sum payment.
At the request of a defendant physician or health care provider or claimant, the court may order that future damages other than medical, health care or custodial services awarded be paid in whole or in part in periodic payments. On the death of the recipient, money damages awarded for loss of future earnings continue to be paid to the estate of the recipient without reduction; however, all periodic payments, other than future loss of earnings, terminate on the death of the recipient.

7. Non-Economic Damages Caps for Certain Hospitals
Section § 311.0456 of the Health and Safety Code provides a limit on liability for certain hospitals. If a non-profit hospital or hospital system provides what is called “charity care” in an amount equal to at least 8% of the net patient revenue of the hospital or hospital system and provides at least 40% of the “charity care” of the county in which it is located, the hospital can apply to the Texas Department of Health to be certified as a charity hospital for purposes of limited liability. The certification process is an annual process. Any hospital or hospital system that so qualifies will have liability for non-economic damages limited to $100,000. As of the time of writing this article, some 37 hospitals have been certified under this section.

Admissibility of Non-Use of Seat Belt or Child Safety Seat in Automobile Litigation

The legislature repealed Transportation Code §§ 545.412(d) and 5.5.413(g). These transportation code provisions prevented evidence from being admitted regarding the use or non-use of seat belts or child safety seats. Use or non-use of seat belts or child safety seats are now admissible in all civil trials. It is obvious that the legislature intended that non-use of safety belts be considered evidence of contributory negligence. However, non-use of seat belts ordinarily is not the “but-for” or “substantial factor” in the injury-causing event. See Kerby v. Abilene Christian College, 503 S.W.2d 526, 528 (Tex. 1978)(stating driving without use of available seat belts is not contributory negligence such that would bar recovery).
However, since Kerby was decided, failure to use seat belts or child safety seats has become a misdemeanor, and arguably, one who fails to use them “violates an applicable legal standard” under § 33.003. Under that section, one’s “percentage of responsibility. . . with respect to . . . causing or contributing to cause in any way the harm for which recovery of damages is sought. . . by other conduct or activity that violates an applicable legal standard” shall be submitted to the trier of fact.

Wrongful Death

Although not part of HB4, all personal injury litigators should be aware of amendments to the Wrongful Death Statute in Chapter 71 of the Texas Practice and Remedies Code. The Act now includes liability for the death of an unborn child. It defines an “individual” to include an unborn child in every stage of gestation from fertilization until birth. Liability does not extend to those who lawfully perform abortions or to the mothers of the unborn child.
As a result of this amendment, recovery for the death of an unborn child will now be allowed in automobile, premises liability and product liability cases.

Interest

The Finance Code was amended at § 304.003(c) to change the post judgment interest rate from a floor of 10% and a ceiling of 20% to a floor of 5% and a ceiling of 15%. Since Finance Code § 304.103 states that for cases involving personal injury, wrongful death and property damage, the pre-judgment interest rate is equal to the post judgment interest rate applicable at the time of judgment, the legislature has also effectively amended the pre-judgment interest rate as well.
The changes in pre-judgment interest and post judgment interest apply in any case in which a final judgment is signed or subject to appeal on or after September 1, 2003, regardless of when the case originally was filed.

Conclusion

HB4 dramatically alters the landscape of civil litigation in Texas, particularly personal injury litigation. This paper has highlighted some of the most important areas contained in this mammoth bill. All litigators should acquaint themselves with these changes, as they will affect the settlement process and the settlement value of many cases.

Professor Melissa Essary teaches Torts Law and Employment Discrimination Law at Baylor University School of Law. She was a trial lawyer with Vinson and Elkins before joining the law faculty in 1990. She speaks regularly to groups of attorneys, human resource professionals and business executives. Baylor University honored her with the Outstanding Tenured Teacher Award in 2001. Professor Essary has authored numerous articles, and in 1997, the Texas Bar Foundation awarded her the Outstanding Law Journal Article Award.
Professor Essary has served as a mediator in a variety cases and also serves as a consulting expert in litigation matters. Professor Essary received her B.J. from the University of Texas with highest honors and her J.D. from Baylor Law School, magna cum laude.

1. Many thanks to Waco attorney Dale Williams, who presented a paper to the McLennan County Bar Association on this subject. He generously shared his article with me, and it formed the initial basis for this article.

Texas Paralegal Journal © Copyright 2003 by the Legal Assistants Division, State Bar of Texas.

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