How is interest on a judgment to pay attorneys fees calculated?

[Ktribou]

How is interest on a judgment to pay attorneys fees calculated?

Ex-wife was ordered to pay $5100 of my attorneys fees last year at 12% interest in Washington state. No fees to date have been paid. Does this accrue $51/month indefinitely until the principal is paid down and interest is calculated on whatever the remaining principal is from that point, and so on, or does it ever compound yearly or otherwise? Assuming the debt is now $5712 (principal [5100] + 12 months at 12% [612]) and she pays me 500, how does that get applied to the principal and interest? Do payments go towards interest first, principal first, or some distribution of the two?

 

[adjusterjack]

You take the 12% and divide by 365 to get the daily interest rate.

.12 divided by 365 = .00033 times the balance per day. You apply that to the number of days since the judgment for shorter periods than a year.

However, if she went a full year and now owes you 5712 and pays you 500 exactly at the 1 year mark, the balance is 5212 to which you add .00033 x 5212 = 1.668 per day.

Does she work? Why haven't you garnished her pay?

If you just wait while interest accrues you'll never see the money.

 

[Litigator22]

Noting that the body of your post states that an order was issued awarding you attorney fees, but differing from your caption DOES NOT state that you were granted a judgment against the ex spouse, from whence do you derive your notion that the award accrues any "post judgment" interest?

Does the order expressly specify the accrual of interest or is that your assumption?

Is the form of the "order" such as to enable the issuance of a writ of execution authorizing the seizure and sale of the obligor's non-exempt assets in satisfaction of the amount awarded? I suspect not. Also doubtful is that the form of the order or an abstract thereof is susceptible to being recorded as a lien upon the ex-spouse's real property as per RCW 4.56.190.

If not, then how do you compare favorably such an "award" to that of a "civil judgment" as described in RCW 4.56.110?

 

[Taxing Matters]

How is interest on a judgment to pay attorneys fees calculated?

Ex-wife was ordered to pay $5100 of my attorneys fees last year at 12% interest in Washington state. No fees to date have been paid. Does this accrue $51/month indefinitely until the principal is paid down and interest is calculated on whatever the remaining principal is from that point, and so on, or does it ever compound yearly or otherwise?

The statute that sets the rates for post-judgment interest in Washington State is Revised Code of Washington (RCW) setion 4.56.110. That section is silent on whether that is simple interest or compounded interest. Most states hold that where the statute or contract is silent on whether compounding is to be used the interest is simple interest. And that is what Washington courts have held regarding the post judgment interest statute — simple interest is how the interest charge is computed:

Here, both RCW 4.56.110 and 19.52.020 are silent on the issue of compounding. Those statutes provide a rate of interest; they do not speak to the manner in which that rate is applied to the principle [SIC]. Unless a statute specifically provides for the compounding of interest, there is no authority for its application. Goodwin v. Northwestern Mut. Life Ins. Co., supra. Since the statutes here do not expressly permit compounding and the court cannot imply it, only simple interest is allowed.​

Caruso v. Local Union No. 690, Int'l Bhd. of Teamsters, Chauffeurs, Warehousemen & Helpers of Am., 50 Wash. App. 688, 690–91, 749 P.2d 1304, 1305–06 (1988). Similarly, nothing in Washington law provides for compounding of interest on an order awarding attorneys fees. The order must provide that interest will be added, and assuming it does, that interest will computed as simple interest.

Note that the court made an unfortunate common mistake in spelling by confusing principle with principal. When speaking of the base amount of a debt or judgment owed, the correct spelling is principal. You got it right in your post. The court did not.