The standard rate of interest on general damages for pain and suffering and loss of amenities in personal injury cases was fixed at 2% a year by the House of Lords in Birkett v Hayes [1982] 1 WLR 816; [1982] 2 All ER 70). This was confirmed as appropriate by the Court of Appeal in Lawrence v Chief Constable of Staffordshire [2000], The Times, 25 July.

The appropriate rate of interest for special damages is the rate, over the period for which the interest is awarded, which is payable on the court special account. After seven years at 6%, this rate was reduced to 3% a year on 1 February 2009, to 1.5% on 1 June 2009, and to 0.5% on 1 July 2009. Interest since June 1987 has been paid daily on a 1/365th basis, even in a leap year such as 1992.

In cases of continuing special damages, half the appropriate rate from the date of injury to the date of trial is awarded. In cases where the special damages have ceased and are thus limited to a finite period, there are conflicting Court of Appeal decisions as to whether the award should be half the appropriate rate from injury to trial (Dexter v Courtaulds [1984] 1 All ER 70) or the full special account rate from a date within the period to which the special damages are limited (Prokop v DHSS [1985] CLY 1037). The House of Lords has confirmed that Department of Work and Pensions benefit should be disregarded when calculating interest on special damages (Wadey v Surrey County Council [2000] 1 WLR 820 (HL)).

The relevant rates since 1965, which are conveniently set out in the White Book at note 7.0.9, are reproduced in table three. Table 1 records the percentage total of these rates from January 1990. In the left-hand column is shown the month from the first day of which interest is assumed to run. The right-hand column shows the percentage interest accumulated from the first day of each month to 1 October 2010.

Continued use can be made of this table by adding to the figures therein 1/365th of the special account rate from 1 October 2010 onwards. Precision may easily be attained through table 2, which records the accumulated total of days at the end of each of the next six months.

Suppose that interest runs from 1 June 2003 to 13 December 2010. The total to the end of September 2010 is 35.80%. If the rate remains at 0.5% a year, the addition from 1 October 2010 to 13 December 2010 will be 0.5% x 73/365 = 0.10%. Thus the grand total from 1 June 2003 to 13 December 2010 will be 35.80 + 0.10 = 35.90%.

These tables should assist all those concerned with interest since 1985 to make calculations fluently. The listed rates provide the base for a calculation from 1965. Although the tables’ primary application is to interest on special damages in personal injury cases, they are equally applicable to any other case in which the special account is used in calculating interest.

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1990 1991 1992 1993 1994 1995 1996
January 150.82 136.57 124.45 114.18 105.98 97.98 89.98
February 149.61 135.36 123.58 113.31 105.31 97.31 89.31
March 148.51 134.26 122.77 112.69 104.69 96.69 88.67
April 147.30 133.05 121.90 112.01 104.01 96.01 87.99
May 146.13 132.07 121.06 111.35 103.35 95.35 87.33
June 144.92 131.05 120.19 110.02 102.68 94.68 86.65
July 143.75 130.06 119.34 110.02 102.02 94.02 86.00
August 142.54 129.04 118.47 109.34 101.34 93.34 85.32
September 141.33 128.02 117.60 108.66 100.66 92.66 84.64
October 140.16 127.04 116.76 108.00 100.00 92.00 83.98
November 138.95 126.17 115.89 107.32 99.32 91.32 83.30
December 137.78 125.32 115.05 106.66 98.66 90.66 82.64

1997 1998 1999 2000 2001 2002 2003
January 81.96 73.96 65.96 58.38 51.36 44.36 38.28
February 81.28 73.28 68.28 57.79 50.77 43.77 37.77
March 80.67 72.67 64.67 57.23 50.23 43.31 37.31
April 79.99 71.99 63.99 56.64 49.64 42.80 36.80
May 79.33 71.33 63.33 56.06 49.06 42.31 36.31
June 78.65 70.65 62.65 55.47 48.47 41.80 35.80
July 78.00 70.00 62.00 54.89 47.89 41.30 35.30
August 77.32 69.32 61.32 54.30 47.30 40.79 34.79
September 76.64 68.64 60.72 53.70 46.70 40.28 34.28
October 75.98 67.30 59.55 52.35 45.53 39.28 33.28
November 75.30 67.30 59.55 52.53 45.53 39.28 33.28
December 74.64 66.64 58.98 51.96 44.96 38.79 32.79

2004 2005 2006 2007 2008 2009 2010
January 32.28 26.26 20.26 14.26 8.26 2.25 0.37
February 31.77 25.75 19.75 13.75 7.75 1.74 0.33

March 31.29 25.29 19.29 13.29 7.28 1.51 0.29 April 30.78 24.78 18.78 12.78 6.77 1.25 0.25 May 30.29 24.29 18.29 12.29 6.27 1.00 0.21 June 29.78 23.78 17.78 11.78 5.76 0.75 0.17 July 34.80 28.79 22.79 16.79 10.79 4.77 0.13 August 28.78 22.78 16.78 10.78 4.76 0.58 0.08 September 28.27 22.27 16.27 10.27 4.25 0.54 0.04 October 27.77 21.77 15.77 9.77 3.76 0.50 November 27.26 21.26 15.26 9.26 3.25 0.46 December 26.77 20.77 14.77 8.77 2.75 0.42

Table two – accumulated total of days

Table three – rates of interest on special account since 1965

31 October 2010 31
30 November 2010 61
31 December 2010 92
31 January 2011 123
28 February 2011 151
31 March 2011 182
From
1 October 1965 5%
1 September 1966 5.5%
1 March 1968 6%
1 March 1969 6.5%
1 March 1970 7%
1 April 1971 7.5%
1 March 1973 8%
1 March 1974 9%
1 February 1977 10%
1 March 1979 12.5%
1 January 1980 15%
1 January 1981 12.5%
1 December 1981 15%
1 March 1982 14%
1 July 1982 13%
1 April 1983 12.5%
1 April 1984 12%
1 August 1986 11.5%
1 January 1987 12.25%
1 April 1987 11.75%
1 November 1987 11.25%
1 December 1987 11%
1 May 1988 9.5%
1 August 1988 11%
1 November 1988 12.25%
1 January 1989 13%
1 November 1989 14.25%
1 April 1991 12%
1 October 1991 10.25%
1 February 1993 8%
1 August 1999 7%
1 February 2002 6%
1 February 2009 3%
1 June 2009 1.5%
1 July 2009 0.5%

Rodney Nelson-Jones is a partner at Field Fisher Waterhouse