Section 8-8-8 - Interest accrues on breach of contract, Ala. Code § 8-8-8 (2024)
Section 8-8-8 - Interest accrues on breach of contract
All contracts, express or implied, for the payment of money, or other thing, or for the performance of any act or duty bear interest from the day such money, or thing, estimating it at its money value, should have been paid, or such act, estimating the compensation therefor in money, performed.
As a legal expert with a thorough understanding of contract law, I bring a wealth of knowledge to the discussion on Section 8-8-8 of the Alabama Code (1975). My expertise is grounded in a comprehensive grasp of legal principles, historical contexts, and the evolution of statutes over time. I am committed to providing accurate and insightful information to foster a deeper understanding of the subject at hand.
Now, let's delve into the specifics of Section 8-8-8 of the Alabama Code. This statute pertains to the accrual of interest in the context of breach of contract. The language of the statute is meticulous and carries a rich history, with roots traced back to the Code of 1852. Its subsequent iterations in the Code of 1867, Code of 1876, and onward, demonstrate the enduring significance of this legal provision.
Section 8-8-8 states that interest accrues on all contracts, whether express or implied, that involve the payment of money or other things, or the performance of any act or duty. The interest begins accruing from the day when the money or thing, assessed at its monetary value, should have been paid, or when the act, with compensation estimated in money, should have been performed.
This statute underscores the fundamental principle that parties entering into a contract are obligated to fulfill their financial or performance-related commitments within the agreed-upon terms. Failure to do so triggers the accrual of interest, providing a financial remedy for the party suffering from the breach.
The historical journey of Section 8-8-8 through various legal codes showcases its resilience and enduring relevance in shaping the legal landscape of contract law in Alabama. Its presence in legal codes spanning decades highlights the recognition of the importance of regulating interest accrual in breach of contract scenarios.
In essence, Section 8-8-8 serves as a cornerstone in the legal framework governing contracts in Alabama, contributing to the fair and just resolution of disputes arising from contractual breaches. Its nuanced language reflects a careful balance between the rights and obligations of contracting parties, ultimately promoting accountability and upholding the integrity of contractual agreements.
(a) Judgments for the payment of money, other than costs, if based upon a contract action, bear interest from the day of the cause of action, at the same rate of interest as stated in the contract; all other judgments shall bear interest at the rate of 7.5 percent per annum, the provisions of Section 8-8-1 to the ...
The legal maximum interest rate, if agreed upon in writing, is 8% per year, otherwise the maximum rate is 6% per year. If the interest charged exceeds the amount legally permitted by Alabama law, it's usurious. If so, the contract can't be enforced, except to pay the principal originally loaned.
During this time, any unpaid principal balance collects interest. Typically, a judgment can be renewed multiple times for 10 years, with a 10% interest rate on any unpaid balance. However, some judgments for medical expenses or personal debt can only be renewed once for 5 years, with a 5% interest rate.
Section 685.010 - Rate of interest (a) (1) Except as provided in paragraph (2), interest accrues at the rate of 10 percent per annum on the principal amount of a money judgment remaining unsatisfied.
If it can be proved that a contract was breached, the remedy would generally be to give the victim what they were initially promised. A breach of contract is not considered a crime or even a tort, and punitive damages are rarely awarded for failing to perform promised obligations.
The hardest part of proving a breach of contract for an oral agreement is proving that the contract existed and was valid. The plaintiff might have to present witness testimony to do so.
Punitive damages are awarded in addition to compensatory damages. Punitive damages are rarely awarded for breach of contract. They arise more often in tort cases, to punish deliberate or reckless misconduct that results in personal harm.
With some constitutional amendments, most notably the 1979 constitutional amendment, Article XV, Section 1, California's usury limit is now generally 10% per year with a broader range of exemptions.
What is Usury? Usury laws protect borrowers from predatory lending by setting standards for interest rates and fees. Under California's usury law, lenders are required by law to limit simple interest on loans to 10% per year, with exemptions that you could drive a truck through.
(a) Public projects of sixty thousand dollars ($60,000) or less may be performed by the employees of a public agency by force account, by negotiated contract, or by purchase order.
(a) Any legal rate of interest stipulated by a contract remains chargeable after a breach thereof, as before, until the contract is superseded by a verdict or other new obligation.
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