Effective August 1, 2009, the interest rate on judgments greater than $50,000 entered in Minnesota courts will increase from 4 percent to 10 percent. Previously, the judgment interest rate was adjusted annually pursuant to statute directing that the rate be tied to the one-year constant maturity treasury yield reported by the Federal Reserve, or 4 percent, whichever is greater. For 2008 and 2009, the judgment interest rate has been 4 percent. The apparent reason for the interest rate increase to 10 percent for judgments over $50,000 is to discourage appeals brought for purposes of delay by parties that could earn interest in the marketplace higher than the judgment rate during the appeal—effectively "buying down" the value of the judgment. NOTE: the interest rate on condemnation awards continues to be controlled by the constitutional principle of "just compensation"; accordingly, a property owner securing a condemnation award continues to have the right to request a greater interest rate from the court (even greater than 10 percent) if the property owner is able to show that the statutory interest rate does not provide "what a reasonable and prudent investor would have earned while investing so as to maximize the rate of return, yet guarantee safety of principle." State by Humphrey v. Jim Lupient Oldsmobile Co., 509 N.W.2d 361, 364 (Minn. 1993).
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