Rodney Nelson-Jones presents his annual update on calculating interest for personal injury claims


The standard rate of interest on general damages for pain and suffering and loss of amenities in personal injury cases 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 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. 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.



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 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 conveniently set out in the White Book at note 7.0.17, are reproduced in table three. Table one records the total of these rates from January 1987. 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 2007.



Continued use can be made of this table by adding to the figures therein 1/365th of the special account rate from 1 October 2007 onwards. Precision may easily be attained through table two, 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 2007. The total to the end of September 2006 is 54.90%. If the rate remains at 6% per annum, the grand total from 1 March 1999 to 13 December 2007 will be 54.90 + 1.20 = 56.10%.



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 City firm Field Fisher Waterhouse



Table one - total rates

DATES 1987 - 1988 - 1989 - 1990 - 1991 - 1992 - 1993 - 1994 - 1995 - 1996

January 176.88 - 165.11 - 154.25 - 141.04 - 126.79 - 114.68 - 104.40 - 96.21 - 88.21 - 80.21

February 175.84 - 164.18 - 153.15 - 139.83 - 125.58 - 113.81 - 103.53 - 95.53 - 87.53 - 79.53

March 174.90 - 163.31 - 152.15 - 138.74 - 124.49 - 113.00 - 102.92 - 94.92 - 86.92 - 78.90

April 173.86 - 162.37 - 151.05 - 137.53 - 123.28 - 112.12 - 102.24 - 94.24 - 86.24 - 78.22

May 172.90 - 161.47 - 149.98 - 136.36 - 122.29 - 111.28 - 101.58 - 93.58 - 85.58 - 77.56

June 171.90 - 160.66 - 148.87 - 135.15 - 121.27 - 110.41 - 100.90 - 92.90 - 84.90 - 76.88

July 170.93 - 159.88 - 147.81 - 133.98 - 120.29 - 109.57 - 100.24 - 92.24 - 84.24 - 76.22

August 169.93 - 159.07 - 146.70 - 132.77 - 119.27 - 108.70 - 99.56 - 91.56 - 83.56 - 75.54

September 168.94 - 158.14 - 145.60 - 131.56 - 118.25 - 107.83 - 98.88 - 90.88 - 82.88 - 74.86

October 167.97 - 157.23 - 144.53 - 130.39 - 117.26 - 106.99 - 98.23 - 90.23 - 82.23 - 74.21

November 166.97 - 156.30 - 143.43 - 129.18 - 116.39 - 106.12 - 97.55 - 89.55 - 81.55 - 73.53

December 166.05 155.29 - 142.25 - 128.00 - 115.55 - 105.27 - 96.89 - 88.89 - 80.89 - 72.87



Total rates (continued)

DATES 1997 - 1998 - 1999 - 2000 - 2001 - 2002 - 2003 - 2004 - 2005 - 2006 - 2007

January 72.19 - 64.19 - 56.19 - 48.61 - 41.59 - 34.59 - 28.50 - 22.50 - 16.49 - 10.49 - 4.49

February 71.51 - 63.51 - 55.51 - 48.01 - 40.99 - 33.99 - 27.99 - 21.99 - 15.98 - 9.98 - 3.98

March 70.90 - 62.90 - 54.90 - 47.46 - 40.46 - 33.53 - 27.53 - 21.52 - 15.52 - 9.52 - 3.52

April 70.22 - 62.22 - 54.22 - 46.86 - 39.86 - 33.02 - 27.02 - 21.01 - 15.01 - 9.01 - 3.01

May 69.56 - 61.56 - 53.56 - 46.29 - 39.29 - 32.53 - 26.53 - 20.52 - 14.52 - 8.52 - 2.52

June 68.88 - 60.88 - 52.88 - 45.69 - 38.69 - 32.02 - 26.02 - 20.01 - 14.01 - 8.01 - 2.01

July 68.22 - 60.22 - 52.22 - 45.12 - 38.12 - 31.53 - 25.53 - 19.51 - 13.51 - 7.51 - 1.51

August 67.54 - 59.54 - 51.54 - 44.52 - 37.52 - 31.02 - 25.02 - 19.00 - 13.00 - 7.00 - 1.00

September 66.86 - 58.86 - 50.95 - 43.93 - 36.93 - 30.51 - 24.51 - 18.49 - 12.49 - 6.49 - 0.49

October 66.21 - 58.21 - 50.37 - 43.35 - 36.35 - 30.02 - 24.02 - 18.00 - 12.00 - 6.00

November 65.53 - 57.53 - 49.78 - 42.76 - 35.76 - 29.51 - 23.51 - 17.49 - 11.49 - 5.49

December 64.87 - 56.87 - 49.20 - 42.18 - 35.18 - 29.01 - 23.01 - 17.00 - 11.00 - 5.00



Table two - accumulated total of days



31 October 2007 31

30 November 2007 61

31 December 2007 92

31 January 2008 123

29 February 2008 152

31 March 2008 183



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%