Rodney Nelson-Jones sets out our annual tables for calculating interest in personal injury claims

The standard rate of interest on general damages for pain and suffering and loss of amenities in personal injury claims was fixed at 2% per annum by the House of Lords in Birkett v Hayes [1982] 1 WLR 816; [1982] 2 All ER 70). This has been 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. This rate was reduced to 6% per annum on 1 February 2002. 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 appeal court 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 for Works 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 set out in the White Book at note 7.0.17, are reproduced in table 3. Table 1 records the total of these rates from January 1986. In the left column is shown the month from the first day of which interest is assumed to run. The right column shows the percentage interest accumulated from the first day of each month to 1 October 2006.


Continued use can be made of this table by adding to the figures therein 1/365th of the special account rate from 1 October 2006 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 March 1999 to 13 December 2006. The total to the end of September 2006 is 48.90%. If the rate remains at 6% per annum, the grand total from 1 March 1999 to 13 December 2006 will be 48.90 + 1.20 = 50.10%.


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.


Rodney Nelson-Jones is a partner at London-based law firm Field Fisher Waterhouse







Table two - accumulated total of days



31 October 2006 - 31

30 November 2006 - 61

31 December 2006 - 92

31 January 2007 - 123

28 February 2007 - 151

31 March 2007 - 182







Table three - rates since 1965



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%