(1) A court can not order the payment of interest on—
(a) an award for
general damages; or
(b) an award of damages for gratuitous services provided
to an injured person.
(2) Interest awarded on damages compensating past
monetary loss—
(a) must not be more than interest at the appropriate rate;
and
(b) must be related in an appropriate way to the period over which the
loss was incurred.
(3) The appropriate rate is the rate for 10 year Treasury
bonds published by the Reserve Bank of Australia under ‘Capital Market
Yields—Government Bonds—Daily—F2’ as at the beginning of the quarter
in which the award of interest is made.
Example of calculation of interest for
this section—
Suppose that past monetary loss consists of medical expenses
that have been incurred at a uniform rate over a particular period. The
interest to be awarded would be calculated under the following formula—
A = am/100 x p x 0.5
where—
"A" is the amount of the award of interest.
"a" is a percentage rate decided by the court subject to the limit fixed in
subsection (2) .
"m" is the aggregate of the medical expenses.
"p" is the period over which the medical expenses have been incurred
(expressed in years).
