How to calculate interest for a 26-months-overdue amount?
September 8, 2011 6:56 AM Subscribe
How to calculate interest on a long-overdue paycheck in small claims court?
I'm going to small claims court to ask for a paycheck that I didn't receive in May of 2009. I'd like to ask for interest on that paycheck as well--let's say the check was for $1000. Is this legitimate, and how do I calculate that?
Also, is there any mechanism for asking for a "this has been time and effort to pursue" amount on top of that?
This is in New York. Thank you.
I'm going to small claims court to ask for a paycheck that I didn't receive in May of 2009. I'd like to ask for interest on that paycheck as well--let's say the check was for $1000. Is this legitimate, and how do I calculate that?
Also, is there any mechanism for asking for a "this has been time and effort to pursue" amount on top of that?
This is in New York. Thank you.
To calculate interest you'd need to assume an interest rate. Interest rates have been extremely low for the last couple of years. If you'd stuck $1k in a basic savings account in May of '09, by now you might've earned $10-$20. In other words, don't spend a lot of extra time fighting for this.
posted by jon1270 at 7:15 AM on September 8, 2011 [2 favorites]
posted by jon1270 at 7:15 AM on September 8, 2011 [2 favorites]
Find out what the IRS charges for late returns. Use that rate.
posted by notsnot at 7:42 AM on September 8, 2011 [1 favorite]
posted by notsnot at 7:42 AM on September 8, 2011 [1 favorite]
This NY Bankruptcy Court case - citing CPLR s. 5004 and some caselaw - says that prejudgment interest is 9% simple interest. I am not a NY lawyer so I can't say if that's for sure, or if that's applicable to all cases, but it seems like a good place to start. You can cite that section to the court when asking for the money and bring along the calculation with you. I would not assume that just because other interest rates over that time have been low it is not worth it; if the law gives you a remedy you should feel free to take it.
So if you go to a simple interest calculator like this one and enter all of the inputs, it comes out to $210 as of September 2011.
As for costs, I would bet that the small claims court has something that describes your recoverable costs. At the least, you should get your filing and service fees paid.
posted by AgentRocket at 8:09 AM on September 8, 2011 [3 favorites]
So if you go to a simple interest calculator like this one and enter all of the inputs, it comes out to $210 as of September 2011.
As for costs, I would bet that the small claims court has something that describes your recoverable costs. At the least, you should get your filing and service fees paid.
posted by AgentRocket at 8:09 AM on September 8, 2011 [3 favorites]
I love that the two wrong answers both have favorites and AgentRocket, who has it right, does not. New York statutory pre-judgment interest rate is fixed at 9% pursuant to CPLR Sec. 5004, assuming that interest is available on your small claims court judgment. The fact that this is vastly higher than any normal investment during the period from 2009 to the present is irrelevant. This is not legal advice and I'm not opining on whether you are entitled to interest at the statutory rate in your particular case, but if you do get it that's what it is.
posted by The Bellman at 8:15 AM on September 8, 2011 [1 favorite]
posted by The Bellman at 8:15 AM on September 8, 2011 [1 favorite]
ยง 5001 : NY Code - Section 5001: Interest to verdict, report or decision
(c) Specifying date; computing interest. The date from which interest is to be computed shall be specified in the verdict, report or decision. If a jury is discharged without specifying the date, the court upon motion shall fix the date, except that where the date is certain and not in dispute, the date may be fixed by the clerk of the court upon affidavit. The amount of interest shall be computed by the clerk of the court, to the date the verdict was rendered or the report or decision was made, and included in the total sum awarded.
(emphasis mine)
posted by Lucinda at 8:23 AM on September 8, 2011 [1 favorite]
(c) Specifying date; computing interest. The date from which interest is to be computed shall be specified in the verdict, report or decision. If a jury is discharged without specifying the date, the court upon motion shall fix the date, except that where the date is certain and not in dispute, the date may be fixed by the clerk of the court upon affidavit. The amount of interest shall be computed by the clerk of the court, to the date the verdict was rendered or the report or decision was made, and included in the total sum awarded.
(emphasis mine)
posted by Lucinda at 8:23 AM on September 8, 2011 [1 favorite]
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posted by jayder at 7:00 AM on September 8, 2011