By Amy Dillon, Law Clerk ADC Legal
In Australia, interest can be awarded to a Plaintiff to compensate the Plaintiff for the time it took the Defendant to pay the amount outstanding. There are two types of interest that may be awarded, pre-judgment and post-judgment interest. Each State and Territory have different legislation and rules which apply when calculating interest. This article will look at interest rates in Victoria, Queensland and New South Wales.
Victoria
In Victoria, interest on a debt will begin to accumulate the day after the Originating Motion was filed. The Supreme Court Act 1986 (Vic) at sections 58 and 60 provide statutory power to award interest. Section 58 provides that interest is to be awarded unless good cause is shown, in accordance with section 2 of the Penalty Interest Rates Act 1983 (Vic).
Justice Tadgell, in the case Dimos v Willetts and Anor [2000] VSCA 154 noted that section 58 allows interest to be awarded in favour of a party who recovers in the proceeding and that the award of interest run from the time when the demand of payment was made.
Queensland
In Queensland, interest begins to accumulate at the time the debt arose. The Registrar will apply the interest rate when giving judgment as per rule 283 of the Uniform Civil Procedure Rules 1999 (QLD).
Rule 283(2)(a) of the Uniform Civil Proceeding Rules 1999 (QLD) states that if interest is claimed, interest is to be calculated to the date of judgment, at the rate specified in the claim or in a practice direction for the Civil Proceedings Act 2011 (QLD), section 58. This came into effect on 1 September 2012. Prior to 1 September 2012, pre-judgment rates were set by the individual courts as per section 47 of the Supreme Court Act 1995 (QLD).
New South Wales
Currently in New South Wales, the pre-judgment interest rate is awarded by the Court in accordance with sections 100 of the Uniform Civil Procedure Act 2005 (NSW). The post-judgment interest is award by the Court as per section 101 of the Uniform Civil Procedure Act 2005 (NSW).
Section 100 of the Uniform Civil Procedure Act 2005 (NSW) the Court may include interest in the amount for which judgment is given and is to be calculated at such a rate the Court thinks fit. This can be on whole or any part of the money from the time the debt arose.
Pursuant to section 101 of the Uniform Civil Procedure Rules 2005 (NSW), interest is payable on so much of the amount of a judgment and that it is to be calculated at the prescribed rate or as the Court sees fit from the date of judgment or a later date set by the Court.
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